Guide Towers Watson Superannuation Fund 1 December 2017
Important information The information in this document forms part of the Towers Watson Superannuation Fund (the Fund) Product Disclosure Statement (PDS), dated 1 December 2017. This PDS provides a summary of the benefits provided to Category D, Category B and Category I members. This information should be read in conjunction with the other documents that form part of the PDS. You should consider this information before making a decision about the product. The information provided is general information only and does not take into account your particular objectives, financial circumstances or needs. It is not personal or tax advice. Any examples included are for illustration only and are not intended to be recommendations or preferred courses of action. You should consider obtaining professional advice about your particular circumstances before making any financial or investment decisions based on the information contained in this document. returns can be positive or negative and are not guaranteed by the Trustee or Willis Towers Watson. Information on tax and superannuation legislation is current as at 1 December 2017 unless otherwise noted. The Trustee reserves the right to correct any errors or omissions. The Trustee, Wycomp Pty. Limited (ABN 33 002 101 377), does not provide personal advice. The Trustee will only provide factual information or general superannuation advice. Information contained in this document that is not materially adverse is subject to change from time to time and may be updated if it changes. Updated information can be found at https://super.towerswatson.com/super/twsf. In addition, we will provide a hardcopy free of charge on request, if you contact the Fund Administrator on 1800 127 953. Contact us For more information about the Fund: Visit the website at https://super.towerswatson.com/super/twsf Call the Fund Administrator on 1800 127 953 Write to: The Fund Administrator Link Super Pty Limited PO Box 1442 Parramatta NSW 2124 Email: TWSFsuper@linksuper.com
Table of contents Your investment choice... 4 Learning the basics of investments... 5 risks... 8 How investment choice works... 9 Your five investment options...10 Your questions answered... 15 3 Product Disclosure Statement
Your investment choice As a member of the Towers Watson Superannuation Fund you have the flexibility to choose how your superannuation is invested. This is an important decision, as the amount of investment returns your super receives directly impacts the amount of your retirement savings and can affect your lifestyle in retirement. The Fund offers you five different options, each with a different investment mix. Each option has a different level of risk and expected return so that you can choose the option that best meets your investment goals. You must make an investment choice when you join the Fund or your application for membership of Category D or B cannot be processed and you will join the Fund as a Category I (Insurance only) member. Investing your super choice is available to all members of the Fund and applies to your total accumulation account balance and future contributions. You must choose one of the following five investment options: Aggressive Growth Balanced Moderate, or Cash. Understanding your personal situation Choosing the right option is a personal decision. Before choosing, spend some time thinking about your own personal circumstances and think about these issues. How much will I need when I retire? Financial experts say that to maintain your lifestyle in retirement, you may need an annual income of around 60% 70% of your final income when you retire. If your super will be your only form of income in retirement, you may be less inclined to take risks with your super. However, if you have other forms of income, such as property, or other savings and investments, or expect to receive a full or partial age pension, you may be more comfortable taking investment risks. How long before I will need my super? If it is many years before you will need your super, you have a long investment horizon. Short-term ups and downs in investments may be less of a concern. However, if you need your money in the short term, a more risky investment may not be appropriate. How do I feel about investment risk? Some of us, by nature, do not like to take risks with our money. If you re likely to lie awake at night worrying about your investments or will panic at the sight of negative returns, you may feel happier investing in moderate or lower-risk options. On the other hand, if you are comfortable with the fact that your super savings will go down as well as up, higher-risk options may be right for you. If you don t like to take risks, you need to remember that if you re too conservative with your investments, your super may not keep up with inflation, which would make you worse off in retirement. To help you make the right investment choice, it s important you understand some investment basics, which are outlined on the following pages. Making your choice If you are a new member, you should indicate your initial investment choice on the Fund s Membership Application. You can change your investment choice each month if you wish: Complete the Switching form, available from the Fund Administrator on 1800 127 953 or download it from the website at https://super.towerswatson.com/super/twsf, or Visit the Member Centre on the website and make your choice online. Changes to your investment option are effective from the start of each month. No switching fee or buy-sell spread applies to your initial choice or if you change your investment option. Please note neither the Trustee, Fund Administrator nor Human Resources will provide advice to you about your investment options. For more information about investing and choosing the right investment option, you should speak to a licensed financial adviser. Towers Watson Australia Pty Ltd has arrangements in place to help you with your financial planning. To speak to one of Towers Watson s licensed financial advisers, contact Susan Rio on (03) 9655 5222. Discounted fees are available for employees of Willis Towers Watson and associated employers. Alternatively, the Financial Planning Association of Australia (FPA) can help you locate a professional financial adviser near you. Call 1300 337 301 or visit www.fpa.com.au for more details. 4 willistowerswatson.com
Learning the basics of investments Asset classes Most investments can be broadly grouped into five investment types: shares, alternative assets, property, fixed interest and cash. The Fund s five investment options differ in the combination of asset classes they use. The five asset classes can be grouped into two main categories: Return-seeking assets include shares, alternative assets and property. These assets generally offer higher returns over the long term than income assets. They also usually have a higher risk in the short term because returns can vary (or fluctuate) widely from year to year. Return-seeking assets may also experience periods of negative annual returns. Income assets include cash and fixed interest, such as Australian and international government bonds and corporate debt. They are generally regarded as lower-risk investments and offer lower expected returns over the long term compared with return-seeking assets. They also have a lower likelihood of negative annual returns. See page 6 for more information on the asset classes. Risk and return In the short term, risk generally refers to the potential for your super to fluctuate in value. Return is the amount of money earned by your super investment. Risk and return go hand-in-hand when you re investing. The higher the long-term return you re aiming for, the greater the risk that your money will fluctuate in value in the short term. That s because to achieve a high long-term return, you need to invest in a greater proportion of return-seeking investments, which tend to be more volatile than income assets. Year by year earnings from return-seeking assets tend to vary more than earnings from income assets. So there s a much greater risk that return-seeking investments will have a negative return in any one year. In the long term, risk can mean: Failing to have enough money in retirement. Choosing an investment option with lower risk of short-term fluctuations may mean you earn a lower return on your super. Over a long period, even a small difference in your investment earnings can make a big difference to your final benefit. This is mainly due to the principle of compounded earnings. On the other hand, it is also possible that an investment option with a high allocation to return-seeking assets could produce a large negative return in one year from which it takes many years to recover, compared to an investment option with more income assets. As a result, choosing an investment option with higher risk can also impact on your retirement savings, for example if asset values are depressed when you wish to retire. Your investment does not keep pace with inflation (e.g. CPI). If you choose an investment option that doesn t have much growth potential, your super may not keep up with inflation over the long term. Over time, prices for goods and services usually increase. If your retirement is some way off, your money won t buy as much by the time you retire as it does today. For more information about investment risks, see page 8. Short term vs. long term Generally, the following terms apply to super investments: Short term an investment period of up to three years. Medium term an investment period of three to seven years. Long term an investment period of seven years or more. 5 Product Disclosure Statement
HIGH Shares When you buy shares, you re buying part ownership of a company listed on a share market. This means that the value of your investment changes in line with the company s share price. Of all the asset types, shares have generally earned the highest return in the long term. However, on the downside, the value of shares will fluctuate more than any other main asset type. Shares also have the highest probability of negative earnings in the short term. The Fund invests in a diversified portfolio of Australian and international shares. To help minimise the impact of currency movements, a combination of hedged and unhedged international shares is used by the Fund (see pages 7 and 8). Alternative assets This is a broad category of investments and investment strategies that sit outside the traditional asset classes of shares, property, fixed interest and cash. It includes individual hedge funds, multi asset funds, derivatives and alternative credit. Alternative assets will typically perform differently to traditional asset classes. This means that investors often use alternative assets to help diversify their investment portfolios. On their own, alternative assets can produce high returns, but with the risk of high short-term volatility. However, when combined with traditional asset classes, their unique risk and return characteristics can help smooth longer-term returns and reduce volatility. LEVEL OF EXPECTED RISK AND RETURN Some of the options currently invest in funds of hedge funds, multi asset funds and alternative credit (see pages 10 to 13). Property Investing in property means investing in industrial, commercial or residential real estate. The value of your investment depends on the rental paid and on any increase or decrease in the property value. In general, property provides long-term returns in excess of inflation. Earnings have historically been less volatile over the long term than those produced by shares, and have been higher than those provided by cash or fixed interest. Property investments can either be direct or indirect. A direct property investment is where a property is purchased by a company to be held on behalf of investors. Indirect property refers to an investment in property that is made by purchasing units in a property trust or listed property securities. Some of the options currently invest in a portfolio of indirect (or listed) global property assets. Fixed interest Fixed interest investments (or bonds ) are issued by Australian and overseas governments, semi-government authorities and companies in return for cash. Interest is paid to investors over the life of the investment at either a fixed or variable rate (e.g. at a rate linked to inflation). The value of your investment depends on the interest paid and whether the value of the bond increases or decreases (with interest rate changes). Over the long term, interest-bearing investments have tended to provide higher returns than cash, but lower returns than shares and property. As their value can fluctuate, this asset class tends to be more volatile than cash, but generally less volatile than shares or property. Some of the options invest in a wide range of Australian and international fixed interest assets, including government and corporate bonds. Cash LOW You re investing in short-term fixed interest assets such as bank bills. Interest is paid on the amount you have invested. It is very unlikely that you ll lose money on a cash investment over a short period of time. However, cash investments may not always keep up with inflation. 6 willistowerswatson.com
terms explained To help you better understand the Fund and the basics of investing, we have defined some investment terms used in this guide. Funds of hedge funds Funds of hedge funds invest in a diverse range of hedge fund managers through the one investment. Hedge funds aim to achieve positive returns regardless of investment market conditions. They do this by using special financial instruments, including derivatives and a variety of other strategies, such as short selling. In isolation, hedge funds can be a volatile investment over the short term, but a fund of hedge funds can help diversify this risk by investing in a wide range of hedge fund managers, which means the Fund is less likely to be unduly exposed to any one hedge fund manager. Currency hedging Multi asset funds These funds invest in a variety of asset classes such as shares, government bonds, commodities and inflation-linked securities. They aim to keep a balanced risk profile through the market cycle by having a more dynamic approach to their asset classes. These products allow investment in each asset class at more reasonable prices than if each asset class was invested in directly. A portion of the Fund s assets is invested in a multi asset strategy called a risk parity fund. This fund aims to provide a balanced set of exposures to a number of different assets. This ensures performance is not reliant on any one economic outcome or asset class. Alternative credit Alternative credit assets are a special type of diversifying asset that invests in private debt. Hedging is a strategy to protect against, or at least reduce, a risk. For the Fund s international share assets, it specifically refers to currency risk (see page 8). The hedged portion of the Fund s international share assets is protected from foreign exchange movements while the unhedged portion is not protected. Derivatives The term derivative describes any financial product (such as futures or options) that has a value derived from another security, liability or index. Derivatives are commonly used in hedge funds. A portion of the Fund s assets is invested in funds of hedge funds (see above for details). The underlying managers for these investments may make use of derivatives to help achieve their objectives. The Fund s other investment managers only use derivatives for risk-control purposes or to more efficiently shift asset allocations. managers are required to have risk management processes in place in relation to the use of derivatives and the purposes for which they are used. The Trustee also has risk management processes in place and monitors the use of derivatives in the Fund through internal controls and external auditors. 7 Product Disclosure Statement
risks As with all investments, there are risks associated with a decision to invest in superannuation and also in choosing a particular investment option. The assets will perform differently at various times. Since each investment option invests in a different mix of assets, the risks of investing in each option are different. The main investment risks are described below. Inflation risk The rate of inflation may exceed the rate of return achieved on your investment. This effectively means that the purchasing power of your investment is reduced. This risk can be considered significant for the Cash option if investing over long periods. Liquidity risk Liquid assets are assets that can be readily converted to cash. Liquidity risk is the risk that some assets may not be able to be converted to cash when needed to pay benefits or process investment switches. This risk affects investments in all asset classes, except for cash. As a result, it can be considered a risk (to varying degrees) for all of the Fund s investment options, with the exception of the Cash option. Individual investment risk Individual investments can (and do) fall in value and returns may be positive or negative in any given year. This risk mainly affects investments in shares, property, multi asset funds and hedge funds, although it can also affect investments in fixed interest assets. As a result, it can be considered a risk (to varying degrees) for most of the Fund s investment options. Interest rate risk Changes in interest rates can have a positive or a negative impact directly or indirectly on investment value or returns. This risk affects all investments and can be considered a risk for all of the Fund s investment options. Currency risk When investments are made in other countries, if foreign currencies change in value relative to the Australian dollar, the value of the investment can change. This risk affects only investments overseas so can be considered a risk for options where a proportion of the assets are invested overseas. Most of the Fund s investment options invest overseas to varying degrees, so this risk may have an impact on returns achieved by all options (except Cash). The Trustee manages some of the currency risk by investing in some international investment vehicles which are hedged to the Australian dollar. Hedging usually involves either buying or selling one investment to protect against loss in another (for example, due to changes in the value of one currency relative to another currency). Derivatives risk The term derivative describes any financial product (such as futures or options) that has a value derived from another security, liability or index. Derivatives are commonly used in hedge funds. Risks associated with using these tools might include the value of the derivative failing to move in line with that of the underlying asset, potential illiquidity of the derivative, the hedge fund may not be able to meet payment obligations as they arise, and counterparty risk (where the counterparty to the derivative contract cannot meet its obligations under the contract). This can be considered a risk (to varying degrees) for all of the Fund s investment options (except Cash). Market risk Changes in investment markets resulting from changes in economic, political and legal conditions or market sentiment can affect the value of investments. This risk affects investments in all asset classes. As a result, it can be considered a risk (to varying degrees) for all of the Fund s investment options. 8 willistowerswatson.com
How investment choice works The Fund offers you five choices for the investment of your super. You must choose one of the five options for the investment of your accumulation account balance: Aggressive Growth Balanced Moderate, and Cash. Each of the options invests in a different mix of the asset classes and each has a different expected risk and return. Read pages 10 to 14 to learn more about each option. returns The investment return you receive on your accumulation accounts is the actual investment return (net of tax and investment fees) achieved by your chosen investment option. Positive earnings increase the amount in your accounts, while the amount in your accounts will be reduced if the investment earnings are negative. For more information on the taxes and fees deducted from investment earnings, see the Super Guide. Socially responsible investments The Trustee does not take into account social, ethical or environmental considerations or labour standards for the purpose of selecting, retaining or realising the Fund s investments. When the Fund s investment managers were selected, the Trustee did not consider whether the managers took these factors into account. Operational risk financial requirement reserve Super funds are required to set aside financial resources to address their operational risks. The Trustee has built up an operational risk reserve in the Fund for this purpose. The reserve has been built up to 0.25% of the Fund s net assets by transferring defined benefit assets to the reserve. The Trustee has decided that the operational risk reserve is invested in the same way as the Growth option. The Trustee updates members on the status of the reserve in the Annual Report. The reserve is monitored periodically by the Trustee to ensure that it remains close to 0.25% of Fund net assets. Interim rate returns are calculated each month. If your super needs to be paid out or you switch investment options before investment earnings can be determined, an interim rate will be used based on the daily movement in market indices up to the date your benefit is calculated. returns will be applied to your benefit up to the date of payment, consistent with your investment choice. The Fund s investment managers managers are shown each year in the Fund s Annual Report. The Trustee may change the Fund s investment managers and their products from time to time without prior notice to, or consent from, members. 9 Product Disclosure Statement
Your five investment options The Aggressive option Overview 1 objectives strategy Benchmark asset allocation This option invests purely in return-seeking assets including shares, property, hedge funds, multi asset portfolios and alternative credit. This may be suitable for members who expect to invest their super for more than seven years. Investors may be seeking to invest purely in return-seeking assets to achieve high capital growth over the long term with a high level of investment volatility (which may include frequent periods of negative returns). To invest purely in return-seeking assets in order to achieve a higher return than the Growth option over the long term, accepting that annual returns will vary considerably and be significantly negative quite frequently. To achieve a return (net of tax and investment fees) that exceeds the increase in CPI by at least 3.5% p.a. over moving 10-year periods. To limit the probability of achieving a negative gross of tax return over moving one-year periods to approximately five years in 20. To invest totally in return-seeking assets, which includes Australian shares, international shares, emerging market shares, property, hedge funds, multi asset funds and alternative credit. 7.0% Range % 20.0% Australian Shares 18.0 22.0 International Shares (unhedged) 11.5 15.5 27.0% International Shares (hedged) 11.5 15.5 13.5% Emerging Market Shares 2.0 6.0 Fund of Hedge Funds 8.0 12.0 10.0% 13.5% 5.0% Global Listed Property 3.0 7.0 4.0% Multi Asset Funds 25.0 29.0 Alternative Credit 5.0 9.0 Australian Fixed Interest Australian Inflation-linked Bonds Cash Minimum suggested investment period 7 years or more Likelihood of a negative return in any 20-year period 2 5 to 6 years in 20 Volatility level 2 6: High very low very high 1 Note that this information is general in nature and is included as required by law. It is not intended to be a recommendation or statement of opinion in relation to any particular investment. Members are encouraged to seek their own advice if they are uncertain as to what might be most appropriate for them. 2 The volatility level shown is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20-year period. It is based on the Standard Risk Measure developed by the industry and is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Members should still ensure they are comfortable with the range of risks and potential losses and gains associated with their investments. 10 willistowerswatson.com
The Growth option Overview 1 objectives strategy This is a diversified strategy which invests across the major asset classes, but with a significant weighting towards return-seeking assets. This may be suitable for members who expect to invest their super for more than seven years. Investors may be seeking a diversified portfolio which aims to achieve moderate to high capital growth over the medium to long term with a high level of investment volatility (which may include periods of negative returns). To invest in a broadly diversified range of investments that will achieve a better return than the Balanced option over the medium to long term, accepting that annual returns will vary quite widely and be negative on occasions. To achieve a return (net of tax and investment fees) that exceeds the increase in CPI by at least 3.0% p.a. over moving 10-year periods. To limit the probability of achieving a negative gross of tax return over moving one-year periods to approximately five years in 20. To invest largely in shares, property, hedge funds, multi asset funds and alternative credit (approximately 80%) with the balance in fixed interest investments. Benchmark asset allocation 10.0% 15.0% 10.0% 10.0% 5.0% 10.0% 22.5% 10.0% 2.5% 5.0% Range % Australian Shares 13.0 17.0 International Shares (unhedged) 8.0 12.0 International Shares (hedged) 8.0 12.0 Emerging Market Shares 0.5 4.5 Fund of Hedge Funds 8.0 12.0 Global Listed Property 3.0 7.0 Multi Asset Funds 20.5 24.5 Alternative Credit 3.0 7.0 Australian Fixed Interest 8.0 12.0 Australian Inflation-linked Bonds 8.0 12.0 Cash Minimum suggested investment period 7 years or more Likelihood of a negative return in any 20-year period 2 4 to 5 years in 20 Volatility level 2 6: High very low very high 1 Note that this information is general in nature and is included as required by law. It is not intended to be a recommendation or statement of opinion in relation to any particular investment. Members are encouraged to seek their own advice if they are uncertain as to what might be most appropriate for them. 2 The volatility level shown is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20-year period. It is based on the Standard Risk Measure developed by the industry and is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Members should still ensure they are comfortable with the range of risks and potential losses and gains associated with their investments. 11 Product Disclosure Statement
The Balanced option Overview 1 objectives strategy This is a diversified strategy which invests across the major asset classes, but with a weighting towards return-seeking assets. This may be suitable for members who expect to invest their super for more than five years. Investors may be seeking a diversified portfolio which aims to achieve moderate to high capital growth over the medium to long term with a medium level of investment volatility (which may include periods of negative returns). To invest in a broadly diversified range of investments that will achieve a better return than the Moderate option over the medium to long term, accepting that annual returns will vary quite widely and be negative on occasions. To achieve a return (net of tax and investment fees) that exceeds the increase in CPI by at least 2.5% p.a. over moving 10-year periods. To limit the probability of achieving a negative gross of tax return over moving one-year periods to approximately four years in 20. To invest largely in shares, property, hedge funds, multi asset funds and alternative credit (approximately 60%) with the balance in fixed interest investments and cash. Benchmark asset allocation 10.0% 10.0% 7.0% 15.0% 7.0% 1.7% 7.5% 15.0% 3.0% 19.8% 4.0% Range % Australian Shares 8.0 12.0 International Shares (unhedged) 5.0 9.0 International Shares (hedged) 5.0 9.0 Emerging Market Shares 0.0 3.7 Fund of Hedge Funds 5.5 9.5 Global Listed Property 1.0 5.0 Multi Asset Funds 17.7 21.7 Alternative Credit 2.0 6.0 Australian Fixed Interest 13.0 17.0 Australian Inflation-linked Bonds 13.0 17.0 Cash 8.0 12.0 Minimum suggested investment period 5 years or more Likelihood of a negative return in any 20-year period 2 3 to 4 years in 20 Volatility level 2 5: Medium to high very low very high 1 Note that this information is general in nature and is included as required by law. It is not intended to be a recommendation or statement of opinion in relation to any particular investment. Members are encouraged to seek their own advice if they are uncertain as to what might be most appropriate for them. 2 The volatility level shown is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20-year period. It is based on the Standard Risk Measure developed by the industry and is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Members should still ensure they are comfortable with the range of risks and potential losses and gains associated with their investments. 12 willistowerswatson.com
The Moderate option Overview 1 objectives strategy This is a diversified strategy which invests across the major asset classes, but with a weighting towards fixed interest and cash. This may be suitable for members who expect to invest their super for more than three years. Investors may be seeking to achieve moderate capital growth over the medium to long term with a low to medium level of investment volatility (which may include periods of negative returns). To provide a better return over the medium term than the Cash option, while accepting a small chance of a negative annual return. To achieve a return (net of tax and investment fees) that exceeds the increase in CPI by at least 1.5% p.a. over moving 10-year periods. To limit the probability of achieving a negative gross of tax return over moving one-year periods to approximately three years in 20. To invest largely in fixed interest investments and cash with the balance (approximately 35%) largely in shares, hedge funds, multi asset funds and alternative credit. Benchmark asset allocation 25.0% 5.0% 4.0% 4.0% 1.0% 5.0% Range % Australian Shares 3.0 7.0 International Shares (unhedged) 2.0 6.0 International Shares (hedged) 2.0 6.0 Emerging Market Shares 0.0 3.0 Fund of Hedge Funds 3.0 7.0 Global Listed Property Multi Asset Funds 11.5 15.5 Alternative Credit 0.5 4.5 Australian Fixed Interest 18.0 22.0 Australian Inflation-linked Bonds 18.0 22.0 Cash 23.0 27.0 13.5% 20.0% 20.0% 2.5% Minimum suggested investment period 3 years or more Likelihood of a negative return in any 20-year period 2 2 to 3 years in 20 Volatility level 2 4: Medium very low very high 1 Note that this information is general in nature and is included as required by law. It is not intended to be a recommendation or statement of opinion in relation to any particular investment. Members are encouraged to seek their own advice if they are uncertain as to what might be most appropriate for them. 2 The volatility level shown is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20-year period. It is based on the Standard Risk Measure developed by the industry and is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Members should still ensure they are comfortable with the range of risks and potential losses and gains associated with their investments. 13 Product Disclosure Statement
The Cash option Overview 1 objectives strategy This option invests purely in cash. This may be suitable for members who expect to invest their super for up to three years. Investors may be seeking a portfolio which aims to achieve low to moderate capital growth over the short term with a very low level of investment volatility. To ensure that the amount invested will not decrease in value at any time. To achieve a return (net of tax and investment fees) that exceeds the increase in CPI over moving 10-year periods. To have a minimal probability of achieving a negative gross of tax return over 20 years. To invest only in secure short-dated bond-type investments, such as bank deposits, bills, mortgages, floating rate notes and short dated bonds. Benchmark asset allocation 100% Range % Cash 100.0 Minimum suggested investment period Up to 3 years Likelihood of a negative return in any 20-year period 2 Less than 0.5 years in 20 Volatility level 2 1: Very Low very low very high 1 Note that this information is general in nature and is included as required by law. It is not intended to be a recommendation or statement of opinion in relation to any particular investment. Members are encouraged to seek their own advice if they are uncertain as to what might be most appropriate for them. 2 The volatility level shown is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20-year period. It is based on the Standard Risk Measure developed by the industry and is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Members should still ensure they are comfortable with the range of risks and potential losses and gains associated with their investments. 14 willistowerswatson.com
Your questions answered How do I get help making my investment decisions? Your decision on how to invest your super is an important personal financial decision. Only you can decide which option is best for you. You may wish to discuss your goals and personal situation with a licensed financial adviser. The Trustee cannot provide advice in relation to your investment choice. Willis Towers Watson has arrangements in place to help you with your financial planning. To speak to one of Willis Towers Watson s licensed financial advisers, contact Susan Rio on (03) 9655 5222. Discounted fees are available for employees of Willis Towers Watson and associated employers. Alternatively, the Financial Planning Association of Australia (FPA) can help you locate a professional financial adviser near you. Call 1300 337 301 or visit www.fpa.com.au for more details. What happens if I don t make an investment choice for my super? All new members must make a decision as a condition of joining the Fund. If you do not make a choice, your application for Category D or B membership cannot be processed and you will join the Fund as a Category I (Insurance only) member. Can I change my mind later? Yes, you can change (or switch) your initial choice each month. Remember that changing your choice too frequently may work against you achieving your investment goals. Super is generally a long-term investment and you may wish to choose the option that is right for you and suits your investment needs during the time until you retire. When you change how your super is invested, your account balance and any future contributions will be invested in your new option. Your new investment choice will apply from the first day of any month, provided your instructions are received by the Fund Administrator by the 25th day of the previous month. How many options can I choose? You can only select one investment option that will apply both to your existing account balance and future contributions. You cannot choose a mix of two or more options. Is there a fee for switching my investments? There are no fees for switching your investment option and the Fund does not charge a buy-sell spread. How do I make a switch? To change your investment, you need to complete an Switching form and return it as directed to the Fund Administrator. Forms can be obtained by calling 1800 127 953 or downloaded from the website at https://super.towerswatson.com/super/twsf. switches can also be made online via the Member Centre on the Fund s website at https://super.towerswatson.com/super/twsf. When will I receive investment returns? returns (net of tax and investment fees) will be applied to your account each month. How do I know how my investment is performing? Each year you will receive the Fund s Annual Report which will outline how each investment option has performed. Your annual Personal Statement of Benefits will also show how your super has performed. You can also check your account balance and see the latest performance of each option on the Fund s website at https://super.towerswatson.com/super/twsf. returns are updated each month. What investment fees will I pay? Details of the investment fees applicable for each investment option are included in the Fees and other costs section of the Super Guide. Issued by Wycomp Pty. Limited (ABN 33 002 101 377), as Trustee of the Towers Watson Superannuation Fund (ABN 93 268 215 348). 15 Product Disclosure Statement