Defined contribution schemes will move increasingly to target date funds over the course of 2009 with greater emphasis on member engagement, industry experts claim.
Research into the US 401(k) system carried out by DC provider Friends Provident and consultancy firm TOR Financial has shown a clear trend of convergence between the US and UK systems. Friends Provident Life and Pensions managing director Simon Clamp says: "Our primary purpose was to examine what was taking the market forward. "When you look at the UK and US markets, you see there are quite a few similar challenges - how do you plan for future eventualities and getting the right return at the time of retirement?" Clamp adds auto-escalation and target date practices were a positive ste...
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