This page contains information for Tailored Plan customers, born between 1990 and 1995, who have received an email indicating they’ll be switched to the new Global Leaders Plan in February 2025. Other vintages of the Tailored Plan will be notified of their upcoming switch later in 2025, please see our FAQ below on staged rollout dates.
Why are you updating the Tailored Plan?
As part of our mission to build pension confidence, we regularly review our plan range to ensure that their objectives continue to align with changing customer needs and expectations, as well as the regulatory landscape.
PensionBee is launching a new accumulation default plan, Global Leaders, to allow our customers aged under 50 the opportunity to invest in growth, for longer. This change is designed to give you greater control, clearer understanding, and better alignment with your retirement goals.
Why did you select the Global Leaders Plan as an alternative?
The Global Leaders Plan has been developed in response to customer feedback and aims to bring more transparency and growth opportunities to customers in their accumulation years - the years before they reach retirement. This plan will be the default choice for new customers under 50 who join PensionBee and don’t pick one of our other plans.
The Global Leaders Plan invests in around 1,150 of the world’s largest and most successful companies, spread across 48 developed and emerging market countries. It follows a customised MSCI index, built specifically for PensionBee. The plan is structured as a life fund, meaning your savings will continue to have the same protection you currently benefit from under the Financial Services Compensation Scheme (FSCS), with no upper limit should BlackRock, the money manager, fail.
The plan is focused on the world’s biggest and most recognised companies - the ‘global leaders’ - giving customers the chance to be part of their success journeys. It’s a simple and easy to understand 100% equity plan, bringing complete transparency over where and how your money is invested. You’ll be able to see how the events in global markets and companies such as Apple, Microsoft, NVIDIA and Amazon influence your pension.
Additionally, PensionBee will share details on how it votes at the company AGMs (Annual General Meetings), showing how your feedback, gathered through our annual surveys, influences decisions on important issues.
How does the new Global Leaders Plan differ from the Tailored Plan?
The Tailored Plan 2055-57 and the Global Leaders Plan are both higher risk plans investing 100% of your money into riskier equity-like investments.
However, two key differences between plans are:
- the number of holdings; and
- the future behaviour of the plan.
The Tailored Plan 2055-57 invests in around 7,500 companies, of which approximately 40-50% of those are small-cap companies, worth between $250 million to $2 billion. The Global Leaders Plan only invests in c.1,150 large or mega-cap companies, which are the world’s largest by value and are worth more than $10 billion.
The other key difference is around future behaviour of the plans. The Tailored Plan is a target date fund, which means it starts slowly moving away from equities and derisking to bonds from age 35 onwards. The Global Leaders Plan doesn’t change its risk profile over time, meaning you’ll stay invested in the world’s biggest companies until you decide to switch plans.
As you can see from the table below, the top 20 holdings for the two plans are very similar, however the weightings are slightly different.
Top 20 companies and their weights in each plan as at 31 October 2024.
| Global Leaders Plan | Tailored Plan (2055-2057) | |||
|---|---|---|---|---|
| Company | Weight | Company | Weight | |
| 1 | Apple | 5.3% | NVIDIA | 3.9% |
| 2 | NVIDIA | 5.3% | Apple | 3.9% |
| 3 | Microsoft | 4.6% | Microsoft | 3.5% |
| 4 | Amazon | 2.8% | Amazon | 2.0% |
| 5 | Meta Platforms | 2.0% | Meta Platforms | 1.4% |
| 6 | Alphabet (A) | 1.6% | Alphabet (C) | 1.2% |
| 7 | Alphabet (C) | 1.4% | Alphabet (A) | 1.0% |
| 8 | Taiwan Semiconductor | 1.3% | Broadcom | 0.9% |
| 9 | Broadcom | 1.2% | Tesla | 0.9% |
| 10 | Tesla | 1.1% | Eli Lilly & Co | 0.8% |
| 11 | Eli Lilly & Co | 1.0% | Taiwan Semiconductor | 0.7% |
| 12 | JP Morgan Chase | 1.0% | JP Morgan Chase | 0.7% |
| 13 | Berkshire Hathaway | 1.0% | United Health | 0.6% |
| 14 | Exxon Mobil | 0.8% | Visa (A) | 0.6% |
| 15 | United Health | 0.8% | Home Depot | 0.5% |
| 16 | Visa (A) | 0.7% | Mastercard (A) | 0.5% |
| 17 | Mastercard (A) | 0.7% | Berkshire Hathaway | 0.5% |
| 18 | Home Depot | 0.6% | Costco Wholesale | 0.5% |
| 19 | Procter & Gamble | 0.6% | Novo Nordisk (B) | 0.4% |
| 20 | Costco Wholesale | 0.6% | Johnson & Johnson | 0.4% |
How will performance compare to the Global Leaders Plan?
As shown, the starting position for the top holdings in the Tailored Plan, BlackRock LifePath 2055-57 and your new Global Leaders Plan are very similar, although the weights or the percentage each company comprises in your pension, will be slightly different. This means we expect the returns to be broadly comparable in the short to medium term.
However, performance will be different in the longer term. The Global Leaders Plan will stay heavily invested in global equity markets and remain a higher risk 100% equity plan. This is different from the Tailored Plan which slowly starts to derisk from 35 onwards, moving your money to more historically stable asset classes, like gilts and bonds. This asset class, also known as fixed income, seeks to reduce risk by generating regular interest payments as you approach retirement.
How do the fees compare for the Tailored Plan?
Your one simple annual management fee won’t change. The Tailored Plan costs 0.70% annually and the Global Leaders Plan will also have an annual management fee of 0.70% of your pension balance.
Additionally, if you have more than £100K in your pot, your fee will continue to halve on the portion above this.
What are the costs of switching?
We’re working with BlackRock’s transition team to minimise all costs associated with the switch. This means the majority of your funds will not be out of the market during this time but it does mean there will be a “blackout” period when you can’t make contributions.
BlackRock estimates that the cost of this transfer will be around 0.19%, although it may be lower. At this higher estimate, the average cost for customers, based on an average pension pot size of £20K would be £38. The annual management fee will remain unchanged at 0.70% of your pension balance.
What are the risks of switching?
Your money manager will remain BlackRock, the world’s largest asset manager, with $11.5 trillion in assets under management as of 31 December 2023.
We’ll seek to minimise the risks of this switch by working closely with the team at BlackRock to keep most of your funds invested throughout the switch.
We’ll share more details on the dates that the switch will take place, and the associated “blackout” period, which will be in the first weeks of February 2025. During this time your balance will be unavailable but the majority of your funds will remain invested in the market.
In addition, there is no guarantee that the Global Leaders Plan will perform better than the Tailored in the short, medium or long term. However, based on the feedback we have obtained from customers, we’re confident that the Global Leaders Plan better aligns with our customers’ needs and expectations.
What are my options if I don’t want to be switched to the Global Leaders Plan?
If you don’t want to be automatically switched into the Global Leaders Plan, you can switch into one of our other plans. If you want to switch plans, please log into your online account, your BeeHive. Switches take around 12 working days to complete.
The deadline for switching to a different plan is mid-January 2025. We’ll give you further notice of this in December 2024.
Why are staging the rollout?
In order to remove out of market risk for customers, and ensure all customers stay invested in the market throughout, we’re conducting our default transition in stages. This means we’ll move customers across to Global Leaders vintage by vintage throughout 2025, although the new plan will be live from February 2025 and customers can switch into it earlier should they wish.
Our staged rollout approach promotes good outcomes for all our customers in the Tailored Plan.
Can I continue to make contributions?
All your regular and ad hoc contributions will continue to be paid into your Tailored Plan until your switch begins. Once the switch begins, your BeeHive balance will be frozen until it completes. We estimate this will take around three weeks.
We’ll give you around six weeks notice and then two weeks notice before the switch begins, so you have advanced warning to make contributions before or after this happens.
What if the stock market is volatile in the next month, will you still switch me?
We’re working in close partnership with BlackRock to optimise the switching process for customers. If any extreme market turbulence occurs in the run up to the fund switch date, we’d review the switch timeline, make changes to the approach and notify customers.
Risk warning
As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.
