How can you build funds that deliver the right income level?

Use our interactive calculator to find out

This question is fundamental for any fund manager building multi-asset funds for “income drawdown” as a source of retirement income. Yet, it is rarely tackled head-on. 

In finance, risk always means uncertainty. For a retirement or other income plan exposed to the market, the uncertainty is in how much income will be available. We look at this by comparing the income available for an individual with how much they will be able to sustain three years in the future in the event of moderately bad market conditions.

Because we work with full lifetime simulations of the retirement plan, we naturally address scenarios investors must account for by hand. For example, the average effect of sequencing risk is accounted for in calculating the level of income considered sustainable to start with, while the scale of sensitivity to sequencing risk will show how far that can fall after three years.

Introducing the EV Interactive Asset Allocator for Income

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For a limited time, gain free access to the EV Interactive Asset Allocator for Income calculator which takes an asset allocation and shows:

  • Income at Risk – the underlying risk measure
  • Income Risk Rating – Where the income at risk score places the allocation relative to other funds.
  • Level of Income Efficiency – How much income can the allocation sustain relative to the best possible with the same risk score and a very extensive range of assets?

These innovations, recently given extra importance by the FCA Retirement Income Advice Thematic Review, present this for the income and inflation-linked income levels. 

The income risk rating and level of income efficiency are key aspects of the FCA's review, as they comprehensively assess the suitability and efficiency of income withdrawal strategies.

Introducing EV Income Risk Ratings

We understand the importance of appropriately positioning your fund's income-risk so advisers can efficiently recommend the most suitable income funds to their retirement income advised clients. That’s why we’ve always offered risk ratings for both growth (accumulation) and income (decumulation) funds. With the release of the FCA Retirement Income Advice Thematic Review, this couldn't be even more important.

Our Income Risk Ratings offer a consistent approach to selecting suitable income funds for decumulation while complementing your adviser clients' risk profiling and cashflow withdrawal planning service.

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EV Strategic Asset Allocations

For risk-rated multi-asset portfolios, the level and variability of returns are critically important. Getting the asset allocation right is the key driver, so much so that 90% of investment returns depend on it. 

With a thoughtful selection of asset allocations, you can build or oversee multi-asset funds tailored to your client's unique objectives and investment timelines. Whether you choose to manage these allocations actively or passively, the ability to add your tactical overlay allows for a truly bespoke investment opportunity. 

Our strategic asset allocations, updated quarterly, are dynamic, giving you peace of mind that your portfolios can handle all market conditions and will move as markets do.

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Guides and Whitepapers

Guide to EV Income Risk Methodology 

Would you like to know how you can revolutionise your advice suitability process for income? And are considering switching to a different income or retirement risk profiling solution? 

Drawdown: The Mirror Image of Accumulation

In the report, we take a deeper dive into how the industry can better support consumers preparing for, at, and in retirement.


1 Life Beyond Work: The changing face of retirement Report 2023, BNY Mellon Investment Management

2 NextWealth: Guarding Financial Future Report, January 2024