As you may be aware, investment markets have recently gone through a period of increased market volatility. This led to fluctuations in our unit prices, with Growth based options the most affected.
So how do you deal with these fluctuations? The following summary may help you keep these market movements in perspective and relate them to your income stream savings.
For members drawing regular amounts from an Income Stream, these periods of volatility can be concerning and this is why we recommend our members hold some funds in Cash and/or conservative investment options.
This strategy generally will help shield members from volatile markets by taking regular pension payments from options not subject to high levels of market volatility. It works with long term perspective and maintains a strategy despite market fluctuations. Put simply, it means that members are not making regular withdrawals by selling units in options that are falling. Selling when prices are falling just consolidates those losses – if you leave money invested until prices return, any losses were just on paper.
In turn, when markets start to rise these cash and conservative options can be topped up.
If you are worried about this or would like to review your income stream and where your payments are paid from, you can contact either of us for an appointment.
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