What is a bucket strategy

November 12 |  2 min read

It’s a strategy you may have heard of a few times as you near retirement. While the name may change, the investment principle stays the same; it’s the placement of your superannuation into different investment options for the short, medium, and long-term.

One of these buckets hold the money that you need to live on in the immediate future, while the rest hold the medium to long term investments.

Vision Super recently set up our own bucket strategy which we simply call “the Three Bucket Pension”. The Three Bucket pension is designed to help make your money last as long as possible while providing the flexibility to make lump sum withdrawals to pay for extras.

Key pension features

  • Income – Choose your annual income and receive regular payments subject to the Government’s minimum annual payment requirements.
  • Investments – Set-and-forget strategy which involves investing in 3 of our investment options (Cash, Conservative and Growth) in proportions we determine (taking into account your annual income). This retirement strategy aims to provide you with income while also helping to manage the risk of you outliving your money.
  • Flexibility – Access additional money whenever you need it (this could increase the risk of you outliving your money).
  • Payment frequency – Receive regular payments at a frequency that suits you. These payments are on top of any Government entitlements you may receive.
  • Automatic rebalancing of your portfolio – In August each year, we check how your pension account is invested and, if necessary, based on rebalancing rules, we will rebalance your investment portfolio.

This strategy is currently only available to members who have or are opening an Account based pension.

Who should choose the Three Bucket Pension?

This pension has been designed for members who prefer a set-and-forget retirement strategy and are happy for us to manage investments in the Cash, Growth and Conservative options associated with that strategy (including through annual rebalancing of their investment portfolio).

It’s been designed without considering your personal situation, needs or objectives. Whether it’s right for you and whether your money lasts will depend on your personal circumstances. We recommend you get personal advice about this.

Joining this option and the Fund’s pension options is easier than ever before. This can now be done from the member secure site. Simply log in and decide if this is right for you.

If you’d like more information, or you’re seeking financial advice, call us on 1300 300 820 Monday to Friday between 8:30am and 5pm and we can send you additional information, or set up a meeting with our advice team. Otherwise, have a read of our handy brochure found here.

 

November 12 |  2 min read

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