L&G largest default has reached £25bn of assets under management, and now has more than 10 per cent of its portfolio in private markets.
The Pension Schemes Act requires providers to have a main default with assets of at least £25bn AUM by 2030 to continue operating in the DC workplace market.
L&G has now reached this milestone with its Lifetime Advantage Funds (LAF) default, launched in 2024 to supersede its multi-asset fund (MAF) as the core default strategy.
LAF offers a ‘to and through retirement’ target date fund range to 5.8m DC members, with those previously saving into MAF migrated to this new offering, which offers a higher allocation to growth assets during the accumulation stage.
L&G confirmed LAF now has at least a 10 per cent allocation to private markets, one of the key commitments contained within the Mansion House Accord, although it is targeting at least a 15 per cent allocation, through investment into its Private Markets Access Fund (PMAF).
Since launching in 2024, PMAF has reached £3bn in assets under management, and has already reinvested £2.6bn into society. L&G says it is channelling pension capital into housing, renewable energy and infrastructure, aiming to support UK growth while enhancing pension members’ outcomes. Examples of investments to date include a 311-home affordable housing scheme in Barnet, North London, undertaken by L&G’s Affordable Housing Fund, in which PMAF is invested.
L&G’s default fund assets now total over £60bn, with LAF reaching £25bn and a further £35bn in assets under management across its Target Date Fund offering.
L&G global head of DC Lesley-Ann Morgan says: “The Lifetime Advantage Funds surpassing £25bn in assets in just two years is a testament to the trust our clients place in us, the strength of our investment solutions and our retirement proposition.
“At the same time, our progress in private markets demonstrates how we are delivering on our commitment to improved retirement outcomes for our DC members while helping support the UK economy.
“L&G has long believed in the value a diversified pension portfolio with private markets can provide to people saving for their retirement, and I’m delighted to see how we’ve built on our early adoption of this approach.”