Speaking at a luncheon in Sydney yesterday, Ms Roy said AMP is in the process of transitioning over a million members’ accounts, or around $15 billion, from previous default funds to the firm’s new MySuper lifecycle funds by 2017.
The seven lifecycle (or ‘target date’) funds, which each have their own portfolio manager, each represent a different 10-year cohort. Lifecycle members are put on a ‘glidepath’ throughout their lifetimes that sees them transition through each fund depending on their age.
“We can estimate, on average, what’s happening to people’s lives – and what sort of life events are happening to them based on their age,” said Ms Roy.
The lifecycle approach allows AMP to have a conversation with members about the stage of life they find themselves in, she said.
AMP Capital multi-asset group chief investment officer Sean Henaghan said members start off their careers with a neutral asset allocation, and then at age 36-38 begin to ‘de-risk’ fairly rapidly by about three per cent a year.
“It’s ‘neutral’ rather than ‘strategic’ because effectively these funds don’t have a strategic asset allocation. It’s not a very formulaic, static asset allocation change,” he said.
At the same time as AMP is promoting its MySuper options, the fund continues to build out its relatively new SMSF division.
But Ms Roy, who moved to her new role after working at AMP’s recently-acquired SMSF administration business Multiport, said there is no conflict between the company’s default super and SMSF divisions.
“We recognise that there is a broad spectrum of individuals out there, [including those who just] don’t want to engage in super,” she said.
The company brings the same expertise to individuals who want to be more actively involved in their super via an SMSF, said Ms Roy.
“There’s no conflict. When I go out and talk to my corporates [super clients] I’ll say to them we have the full spectrum, and if there’s a group of senior executives that want an SMSF solution we’ll bring it all to the table,” she said.
