How It Works
Step1 Lifestyle Retirement Bands (LRB’s)
LRBs are dollar based bands of retirement balances. Trustees set the LRBs, through the TTS Application. Investment strategies can then be tailored to each defined band to better match the return and risk needs of each group of members with a projected retirement balance that falls within that LRB.
Step 2 Glide Paths
Glide Paths are a range of investment options over time, typically shifting from growth to defensive assets as member’s age. One Glide Path is set per LRB based on the retirement lifestyle outcome, Age Pension, Tax and other characteristics for that LRB.
Example: Glide Paths per Lifestyle Retirement Band
Step 3 Members are placed into their LRB and onto their Glide Path
Then, each year members are advised on their annual statement of their LRB and investment option plus the switching date (if applicable). This step is a similar automatic process as that used for Age Only Life-cycling.
Annual Re-calibration Process
TTS is not a static application. It automatically recognises the dynamic nature of changing member circumstances over time (e.g. increases in income, voluntary contributions, extended period of leave, etc.) – normally aligned on a yearly basis to the 30 June statement process.