How to fund the pension pot

18 October 2019

What do you do if you are about to enjoy 20 years in retirement but only have enough money for eight of these years? According to the stats, that’s the position of the ‘average’ person in the UK.

Add to the mix the unprecedented period of low interest rates currently.

US$16 trillion of the world’s government bonds in issue are currently trading with a negative coupon – meaning you actually pay the interest for the privilege of holding a bond rather than receiving it.

How to fund the pension pot

Globally, companies paid out a record US$1.37 trillion in headline dividends in 2018, up 9.3%

The ramifications of this are serious, leaving many investors questioning just how they can generate a sufficient income from their savings or investments.

We believe that equity income can provide a solution – targeting quality companies that pay dividends to shareholders. Globally, companies paid out a record US$1.37 trillion in headline dividends in 2018, up 9.3%

In addition, these high-quality, income-producing equities can provide dividend growth over the longer term, potentially providing insulation from inflation and maintaining your spending power.

They will also offer the opportunity to continue to grow savings pots well into their retirement – something we all need to do more of to beat the ‘average’.

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Important information
Past performance is not a guide to future performance.

Income strategy charges are deducted from capital. Because of this, the level of income may be higher but the growth potential of the capital value of the investment may be reduced. The level of income is not guaranteed. Information correct at time of publication. This information is issued and approved by Martin Currie Investment Management Limited. The opinions contained in this article are those of the named manager. They may not necessarily represent the views of other Martin Currie managers, strategies or funds. Market and currency movements may cause the capital value of shares, and the income from them, to fall as well as rise and you may get back less than you invested.