Leading UK pension providers—Standard Life, Royal London, Scottish Widows, and Aviva—are reshaping their default pension fund strategies to allocate more to equities and private assets. The aim is simple: unlock higher growth potential and deliver better retirement outcomes for savers.
Why the Shift Toward Equities?
Equities have historically outperformed bonds and cash over the long term. With rising inflation and longer life expectancies, pension providers face pressure to help members build larger retirement pots. Market trends are showing people are saving longer investment and managers want to create growth.
What Does This Mean for Pension Savers?
For most members, default funds are the “do nothing” option—yet they remain the most widely used. The shift to higher equity and private asset exposure means:
- Stronger growth potential to build bigger retirement pots.
- Better diversification across global equities and alternative assets.
- De-risking of pension funds is being altered at the same time as altering the pension fund investment
Savers don’t need to take action, but should stay informed and consider whether their provider’s strategy aligns with their personal attitude to risk and retirement goals.
Which Insurers Have Changed Their Default Funds?
- Standard Life – Increasing the equity content of its Sustainable Multi Asset Growth Fund with 15 year de-risking to allow up to 100% in growth assets. From 2026, it will launch the Future Opportunities Fund, offering access to private equity, infrastructure, and venture capital for additional diversification.
- Scottish Widows – Has introduced a new Lifetime Investment Strategy. The Growth Path invests 100% in growth assets, while the Balanced Path holds 85% equities and 15% defensive assets. De-risking now starts 12 years before retirement instead of 15, keeping members invested in growth for longer.
- Royal London – Has alter its Governed Range portfolios, switching the Balanced Lifestyle Strategy to use the GP Dynamic Fund, which can hold up to 80% in equities. This reflects the wider industry trend of boosting growth exposure during the accumulation phase.
- Aviva – Revamped its My Future Focus default, moving members into the Long Term Growth Fund with 90% global equities and 10% UK property (up from 75% equities). The de-risking phase has been extended from 10 to 15 years, providing a longer transition into retirement.
What If Your Provider Hasn’t Changed?
Not all pension providers have updated their default funds. With the Pension Bill reinforcing the requirement for employers to offer good-value schemes, now is the time to review whether your current provider and default fund remain fit for purpose.
Conclusion
Employers have a duty to ensure their pension provision helps staff achieve the best possible retirement outcomes. Reviewing your workplace pension scheme—and making employees aware of how default fund changes affect them—is vital.
How Wingate Benefit Solutions Can Help
At Wingate Benefit Solutions, we support employers in reviewing workplace pension plans, assessing default strategies, and communicating clearly with employees.
For a no-obligation review of your scheme, contact us at info@wbs.e-innovate.dev.
The information contained is a sample of the current changes and may alter from the time of issue.
