Member Newsletter
Quarter 1 • 2023
Dear Member
In this newsletter we explain more about the investment options for your retirement savings. There have been changes to the portfolio names, but you do not need to do anything.
If you don't wish to be actively involved in managing your own investments, then the ‘Automatic Life Stage’ investment option is a good choice. With this investment option we automatically invest your retirement savings according to your age.
With the 'Own Investment Choice' option there is no automatic movement between portfolios. This option allows you to decide in which portfolios you want to invest. No matter which option you choose, it is always best to get expert advice from a qualified financial advisor.
We also include an informative article on inflation, and explain the effects of inflation on your retirement savings. Over a long period of time, inflation can erode the purchasing power of the money you have saved.
OUR LIFE STAGE investment STRATEGY
Until age 57
You are invested in the Balanced Growth Portfolio until age 57.
The Woolworths Group Retirement Fund uses an investment strategy that takes your age into consideration. When you are younger, your retirement savings are invested with the aim of higher returns, which carry higher risk. As you get closer to retirement, we aim for more conservative returns with a lower risk. This makes sense, as your Fund Credit needs to be preserved with less risk as you get older.
Our default investment approach is that members up to age 57 are invested in our Balanced Growth Portfolio and then gradually moved to the Conservative Growth Portfolio starting three months before age 57.
After age 57
The three portfolio building blocks
- a more aggressive Balanced Growth Portfolio
- a less aggressive Conservative Growth portfolio
- a stable Money Market portfolio.
Your Benefit Statements will be different
- This approach will help to simplify the communication of our investment strategy.
- These building blocks have always made up the underlying investment strategy of the Life Stage portfolios.
- The investment strategy has not changed at all.
- The only difference now is that you will see the underlying building blocks of your investment.
- Members who have elected to invest in the Shari'ah Portfolio will not see any change as they are not invested in the Automatic Life Stage option.
How does the Automatic Life Stage option work?
- Your Fund Credit is allocated to a portfolio based on your number of years to the normal retirement age of 63.
- The Fund’s administrators gradually and automatically switch you from the more volatile Balanced Growth Portfolio to the less volatile Conservative Growth Portfolio from age 57.
- The returns that you earn are added to your Fund Credit on a daily basis.
- You do not have to make any investment decisions unless your circumstances change and you wish to move to another investment option.
- It is always a good idea to make additional voluntary contributions. In this way you grow your retirement savings and look after your future.
Why the Automatic Life Stage option?
This portfolio is suitable for all members of the Fund who are planning to retire at age 63 and do not wish to be actively involved in managing their own investments. Automatic Life Stage is an appropriate long-term investment strategy for members with a moderate risk profile.
Your retirement savings are automatically allocated to an appropriate investment portfolio based on your age and your risk profile. Automatic Life Stage is a ‘balanced’ investment approach managed by carefully selected expert investment managers who invest in a wide range of different assets both in South Africa and abroad.
The value of expert financial advice
The value of getting financial advice from a qualified financial adviser should not be underestimated.
Contact the Alexforbes Individual Advice Centre (IAC):
Call 0860 100 444 or email iac@aforbes.com