Positively different investments. For investment professionals - - PowerPoint PPT Presentation

▶
positively different investments
SMART_READER_LITE
LIVE PREVIEW

Positively different investments. For investment professionals - - PowerPoint PPT Presentation

Sep 01, 2022 28 likes •350 views

Positively different investments. For investment professionals only. 1 Learning Objectives By the end of this session, attendees will be aware of: The problems that clients need to overcome to save effectively, given the changing

slide-1
SLIDE 1 1

Positively different investments.

For investment professionals only.

slide-2
SLIDE 2 2

Learning Objectives By the end of this session, attendees will be aware of:

  • The problems that clients need to overcome to save effectively, given the changing

demographics in the UK and people’s natural behavioural biases

  • How the health of a client should be taken into consideration when putting together any

financial plan

  • How Vitality’s unique product features can help clients achieve positive outcomes into

retirement

slide-3
SLIDE 3 3

Members

Improved health, better value through improved price and benefits

Society

Healthier society Improved productivity Reduced healthcare burden

Insurer

Lower claims Higher margins Positive selection and lower lapses

To make people healthier, and enhance and protect their lives

Our core purpose

slide-4
SLIDE 4 4

The challenges facing the investment market

People are living longer People are not saving enough in today’s environment Existing products are not addressing the issues in society today

1 2 3

How do we live healthier and fund a longer retirement?

slide-5
SLIDE 5 5

Key trends shaping the agenda on long term savings and retirement

slide-6
SLIDE 6 6

1990 1995 2000 2005 2010 2015 2017

Asset weighted expense ratios

Reduced costs Increased choice

493 3458 1980 2018

Authorised funds

Increased sophistication

Fund innovation

Sources: Investment Association, Morningstar Inc

Traditional managed funds Thematic equity funds Thematic bond funds “Modern” mixed asset funds Hedge funds and absolute return funds Risk profiled funds Rise of passive investing

2010s 2000s 1990s 1980s

Increased use of DFM

2010s 2000s 1990s 1980s

Key trends shaping the agenda on long term savings and retirement

  • 1. Asset management

Increased choice at reducing costs

slide-7
SLIDE 7 7

Changing drivers of mortality Life years added through managing risk factors

4 4

60%

choices conditions

  • f deaths

poor nutrition, inactivity, smoking, alcohol abuse CV disease Diabetes Chronic lung disease Various cancers Risk factor Male Female Smoking 3.20 2.39 High blood pressure 2.50 2.92 Excess body weight 2.30 2.21 High blood sugar 1.57 1.38 High cholesterol 1.33 0.92 Low physical activity 1.27 1.39 Poor nutrition* 2.97 2.57 Alcohol intake 0.58 0.40 Total 9.59 8.98

*Nut, veg, fruit and omega-3 intake

Key trends shaping the agenda on long term savings and retirement:

  • 2. Life expectancy

Life expectancy can be modifiable through behaviour change

Source: Oxford Health Alliance; S. Lim et al Validation of a new predictive risk model: measuring the impact of the major modifiable risks of death for patients and populations

slide-8
SLIDE 8 8

Saving sooner, or retiring later

Retirement age For life expectancy

  • f 83

65

28%

70

15%

75

6% Percentage of salary that should be saved to maintain a 70% income replacement ratio

Key trends shaping the agenda on long term savings and retirement:

  • 3. Individual responsibility for financial provision in retirement

Behavioural biases prevent people from saving enough and being healthy

Benefits are immediate, and guaranteed Benefits are hidden, and uncertain

INSTANT GRATIFICATION LONG-TERM HEALTH AND SAVINGS

The choice - save more today or retire later

Assumptions:

  • 40 year old with £30,000 saved
  • Current monthly salary £2,500
  • Investment return 5%
  • Wage inflation 3%
slide-9
SLIDE 9 9

Technology has driven changes in every industry

Technology is driving increasing personalisation Yet, financial planning tools still take a blunt approach to incorporating life expectancy

Wearable devices Recommendation algorithms Real-time navigation Smart voice assistants Targeted advertising

Key trends shaping the agenda on long term savings and retirement:

  • 4. Technology
slide-10
SLIDE 10 10

Save smarter Live healthier

Clients Save sooner, live healthier Member incentives

Shared value can create additional economic value to help people live better for longer

VitalityInvest Earn fees for longer, better persistency Society Healthier society, stronger savings culture, reduced dependence

Enhanced savings and retirement outcomes

slide-11
SLIDE 11 11

VitalityInvest

Positively different investments.

slide-12
SLIDE 12 12

VitalityInvest – Positively Different

15%

BOOST

100%

OFF PRODUCT CHARGES

50%

BOOST

UP TO UP TO UP TO

SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT

T’s and C’s apply.

slide-13
SLIDE 13 13

SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT BEHAVIOURAL WELLNESS PLATFORM Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM PRODUCTS

50%

BOOST UP TO SAVE SOONER, MORE AND FOR LONGER

VitalityInvest

15%

BOOST UP TO

100%

OFF PRODUCT CHARGES

UP TO VITALITY FUNDS THIRD PARTY FUNDS ASSET MANAGEMENT

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

slide-14
SLIDE 14 14

VITALITY FUNDS THIRD PARTY FUNDS ASSET MANAGEMENT

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

100%

OFF PRODUCT CHARGES

UP TO STAY HEALTHY Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PRODUCTS BEHAVIOURAL WELLNESS PLATFORM PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT

50%

BOOST UP TO

VitalityInvest

15%

BOOST UP TO SAVE SOONER, MORE AND FOR LONGER

slide-15
SLIDE 15 15

Investment term Boost Cumulative boosts 5 years 2% 2.0% 10 years 2.5% 4.5% 15 years 3% 7.7% 20 years 3.5% 11.5% 25 years 4% 15.9% Every 5 years after 25 years 4%

  • Receive a boost to money invested

in Vitality funds, on top of any growth, every 5 years

  • Boosts compound over time
  • Future contributions will also receive

boosts every 5 years

Investment Booster

slide-16
SLIDE 16 16

£119,732 £19,221 5 10 15 20 25 Years Fund with growth Investment Booster

Assumptions:

  • £50,000 invested in

Vitality Retirement Plan

  • 100% in Vitality funds
  • 4% investment growth

Case study: Impact of the Investment Booster

An additional 15.9% return at no extra cost

slide-17
SLIDE 17 17

VITALITY FUNDS THIRD PARTY FUNDS ASSET MANAGEMENT

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PRODUCTS

15%

BOOST UP TO BEHAVIOURAL WELLNESS PLATFORM PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT

50%

BOOST UP TO

VitalityInvest

STAY HEALTHY

100%

OFF PRODUCT CHARGES

UP TO

slide-18
SLIDE 18 18

Healthy Living Discount charge structure

Investment Charges No Vitality Bronze status Silver status Gold status Platinum status <£30k 0.5% 0.5% 0.4% 0.25% 0% £30-75k 0.4% 0.4% 0.3% 0.2% 0% £75-250k 0.3% 0.3% 0.25% 0.15% 0% £250k-500k 0.2% 0.2% 0.15% 0.1% 0% £500k+ 0.15% 0.15% 0.1% 0.05% 0%

Healthy Living Discount

No charges on Platinum Status

  • Clients with a qualifying

VitalityLife or VitalityHealth policy pay discounted charges based on Vitality status

  • Discount is applied monthly

to money invested in Vitality funds

slide-19
SLIDE 19 19

Case study: Combined impact of the Investment Booster and the Healthy Living Discount

£119,732 £13,574 £21,214 5 10 15 20 25 Years Fund with growth Healthy Living Discount impact Investment Booster

Assumptions:

  • £50,000 invested in Vitality Retirement Plan
  • 100% in Vitality funds
  • 4% investment growth
  • Platinum Vitality Status

£34,788

An additional 29% return at no extra cost

slide-20
SLIDE 20 20

Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PRODUCTS VITALITY FUNDS THIRD PARTY FUNDS ASSET MANAGEMENT

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

100%

OFF PRODUCT CHARGES

UP TO SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT

15%

BOOST UP TO BEHAVIOURAL WELLNESS PLATFORM PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM

VitalityInvest

50%

BOOST UP TO MANAGE HEALTH AND WEALTH IN RETIREMENT

slide-21
SLIDE 21 21

Withdrawal prior year Bronze status Silver status Gold status Platinum status 0 - ≤1% 10% 20% 40% 50% 1 - ≤2% 7.5% 15% 25% 35% 2 - ≤3% 6% 12.5% 15% 20% 3 - ≤4% 4% 7.5% 12.5% 15% 4 - ≤5% 0% 5% 10% 12.5% 5 - ≤6% 0% 2.5% 5% 7.5% 6 - ≤7% 0% 0% 2.5% 5% 7 - ≤8% 0% 0% 0% 2.5% >8% 0% 0% 0% 0% Boost as proportion of income taken

Retirement Booster

Example:

  • £300,000 invested in

Vitality funds

  • Platinum Vitality Status
  • Income of £9,000 (3%)

taken last year

  • VitalityInvest pays a

boost of

£1,800 (20%)

slide-22
SLIDE 22 22

Combined these unique benefits can extend your clients’ retirement income by over 10 years

Assumptions:

  • Invests £100,000 at age 40
  • Makes regular contributions of £6,000 per year
  • Takes 25% lump sum at retirement age of 65
  • Draws £2,000 per month until pot runs out
  • 4% investment growth

£600k £500k £400k £300k £200k £100k Years 40 45 50 55 60 65 70 75 80 85 90 95 100

slide-23
SLIDE 23 23

Assumptions: Initial investment at age 40: £100k; Regular contributions: £6k p.a. (incl. tax relief); Retirement age: 65; Takes 25% as a tax-free lump sum; Draws £2k a month until pot runs out; Holds eligible policy and maintains Vitality status throughout; Annual growth = 4%

Combined these unique benefits can extend your retirement income by over 10 years

Vitality status Additional years’ income

No Vitality 0 years

£600k £500k £400k £300k £200k £100k Years 40 45 50 55 60 65 70 75 80 85 90 95 100

slide-24
SLIDE 24 24

Assumptions: Initial investment at age 40: £100k; Regular contributions: £6k p.a. (incl. tax relief); Retirement age: 65; Takes 25% as a tax-free lump sum; Draws £2k a month until pot runs out; Holds eligible policy and maintains Vitality status throughout; Annual growth = 4%

Vitality status Additional years’ income

No Vitality 0 years

Bronze 4 years Silver 5 years Gold 7 years Platinum 12 years

Combined these unique benefits can extend your retirement income by over 10 years

Boosted fund from Investment Booster and Healthy Living Discount

£600k £500k £400k £300k £200k £100k Years 40 45 50 55 60 65 70 75 80 85 90 95 100

Longer lasting income due to Retirement Booster and Healthy Living Discount

slide-25
SLIDE 25 25

100%

OFF PRODUCT CHARGES

UP TO Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PRODUCTS

50%

BOOST UP TO

15%

BOOST UP TO BEHAVIOURAL WELLNESS PLATFORM PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT

VitalityInvest – funds offering

VITALITY FUNDS THIRD PARTY FUNDS ASSET MANAGEMENT

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

slide-26
SLIDE 26 26

100%

OFF PRODUCT CHARGES

UP TO Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PRODUCTS

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

50%

BOOST UP TO SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT VITALITY FUNDS THIRD PARTY FUNDS

15%

BOOST UP TO BEHAVIOURAL WELLNESS PLATFORM ASSET MANAGEMENT

VitalityInvest – solution-focused technology

PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM

slide-27
SLIDE 27 27

Life expectancy will vary drastically based on an individual’s health and lifestyle

52

59

67 61

70

78 78

86

92

Projected life expectancy for a 40 year old male

  • 1. Smoker,

Unhealthy lifestyle

  • 3. Non-smoker,

Unhealthy lifestyle

  • 4. Non-smoker,

Healthy lifestyle

Source: Vitality LiveWell Financial Planner. Inputs: 1. Height 177cm; Weight 102kg; Waist: 110cm; Biometrics: All high; Diet: Bad; Exercise: Rarely Active; Smoker; Alcohol intake: Occasional. 2. Height 177cm; Weight 80kg; Waist: 85cm; Biometrics: All normal; Diet: Ok; Exercise: Moderately Active; Non-Smoker; Alcohol intake: Occasional; Ischaemic heart disease, 5 years since diagnosis 3. Height 177cm; Weight 102kg; Waist: 110cm; Biometrics: All high; Diet: Bad; Exercise: Rarely Active; Non-smoker; Alcohol intake: Occasional. 4. Height 177cm; Weight 70kg; Waist: 80cm; Biometrics: All low; Diet: Great; Exercise: Very Active; Non-Smoker; Alcohol intake: Occasional.

53

66

78

  • 2. Non-smoker,

Impaired life

#

#

#

3 in 4 similar people will live longer than this 1 in 2 similar people will live longer than this 1 in 4 similar people will live longer than this Key:

slide-28
SLIDE 28 28

Life expectancy will vary drastically based on an individual’s health and lifestyle

59

69

76 71

79

85 81

89

94

Projected life expectancy for a 40 year old female

  • 1. Smoker,

Unhealthy lifestyle

  • 3. Non-smoker,

Unhealthy lifestyle

  • 4. Non-smoker,

Healthy lifestyle

Source: Vitality LiveWell Financial Planner. Inputs: 1. Height 164cm; Weight 85kg; Waist: 91cm; Biometrics: All high; Diet: Bad; Exercise: Rarely Active; Smoker; Alcohol intake: Occasional. 2. Height 164cm; Weight 68kg; Waist: 80cm; Biometrics: All normal; Diet: Ok; Exercise: Moderately Active; Non-Smoker; Alcohol intake: Occasional; Ischaemic heart disease, 5 years since diagnosis 3. Height 164cm; Weight 85kg; Waist: 91cm; Biometrics: All high; Diet: Bad; Exercise: Rarely Active; Non-smoker; Alcohol intake: Occasional. 4. Height 164cm; Weight 55kg; Waist: 70cm; Biometrics: All low; Diet: Great; Exercise: Very Active; Non-Smoker; Alcohol intake: Occasional.

61

74

81

  • 2. Non-smoker,

Impaired life

#

#

#

3 in 4 similar people will live longer than this 1 in 2 similar people will live longer than this 1 in 4 similar people will live longer than this Key:

slide-29
SLIDE 29 29

First-to-market financial planning tools for advisers that incorporate individualised life expectancy

DETAILED CASH FLOW ANALYSES ‘WHAT IF’ SCENARIO PLANNING PERSONALISED LIFE EXPECTANCY

The Retirement Modeller

slide-30
SLIDE 30 30

VitalityInvest

BEHAVIOURAL WELLNESS PLATFORM Stocks and Shares ISA JUNIOR ISA RETIREMENT PLAN

Accumulation and drawdown

PERSONALISED LIFE EXPECTANCY PERSONALISED SAVINGS ROADMAP ADVISER HUB TECHNOLOGY PLATFORM PRODUCTS SAVE SOONER, MORE AND FOR LONGER STAY HEALTHY MANAGE HEALTH AND WEALTH IN RETIREMENT

15%

BOOST

50%

BOOST UP TO UP TO VITALITY FUNDS THIRD PARTY FUNDS ASSET MANAGEMENT

“Vanguard” is a trade mark of The Vanguard Group, Inc., and has been licensed for use by Vitality Life Limited.

100%

OFF PRODUCT CHARGES

UP TO

slide-31
SLIDE 31 31

Recap: Learning Objectives In this session, we addressed:

  • The problems that clients need to overcome to save effectively, given the changing

demographics in the UK and people’s natural behavioural biases

  • How the health of a client should be taken into consideration when putting together any

financial plan

  • How Vitality’s unique product features can help clients achieve positive outcomes into

retirement

slide-32
SLIDE 32 32

Positively different Investments.