7IM has launched a range of income-focused model portfolios to respond to rising demand for tax-efficient income solutions.
Having managed bespoke income strategies for over seven years, the firm has expanded its proposition with the launch of a range six risk profiles: Cautious, Moderately Cautious, Balanced, Moderately Adventurous, Adventurous and Adventurous Plus.
Each profile targets a natural yield of between 3% and 4.5%, which 7IM said is a ‘substantial uplift’ on more traditional core portfolios, while maintaining a strong emphasis on capital preservation and long-term stability.
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The actively managed portfolios, which are globally diversified and invest a blend of active and passive strategies, are underpinned by 7IM’s strategic asset allocation (SAA) and benefit from tactical asset allocation to help navigate changing market conditions.
“We developed this range in close collaboration with our advice and planning partners responding directly to their clients’ changing needs,” said Ben Kumar (pictured), head of strategy – wealth, public policy and investment at 7IM.
“The launch represents an evolution of our proposition, complementing our existing Retirement Income Solution and supporting clients with more specific planning needs,” he added.
“The changes to CGT thresholds and upcoming changes to the inheritance tax treatment of unspent pensions has changed how clients are thinking about income. As estates grow, many are gifting surplus income to beneficiaries in a tax-efficient way.
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“This may actually end up being a positive for growth in the UK, with money being passed through the generations at an earlier stage, and appearing in the ‘spending’ economy far sooner.
“This trend is also evident in structures like family investment companies, where dividend income is often more efficient than capital growth. Overall, there is a clear shift toward income-led returns.”
Costs on the portfolios range from 0.49% to 0.62% and they are currently available via the 7IM Platform, with plans to be launched across all major platforms to meet adviser needs.
This story was written by our sister-title, PA Adviser
