Begin your incomeIQ journey

Nobody knows quite what the future holds. Changing life plans and priorities will mean you encounter varying income needs and goals throughout your life and when investing, certain innate behavioural traits will influence your decision-making.

Schroders incomeIQ is a knowledge centre with guides, tips and tools to help you understand these issues and make more informed investment decisions to meet your income needs effectively. We have developed the incomeIQ test which will reveal your behavioural biases and provide useful tips to empower you to make better investment decisions.

Become an empowered investor today with Schroders incomeIQ.

Understanding incomeIQ

What would you like to achieve in life, both personally and financially? Do you fully understand your income needs, for now and the future? The resources below can help you to answer these questions and develop your income plan.

What kind of income investor are you?

Planning your income needs isn’t all about the numbers – it should take into account your current circumstances as well as establishing a realistic view of how you want to live in the future. There are a number of points in your life when income-producing investments might come in handy, whether to pay for school or university fees, a lifestyle change such as setting up your own business, or as supplemental income to earnings as you approach and go through retirement.

Making use of income investing requires a thorough and honest understanding of what you want to achieve, both personally and financially, and the level of risk you’re prepared to take with your money.

  • Funding futures

    Have you considered how an income could help you pay for the costs of raising a family? Many parents expect to have to help their children with university costs or buying a home. Favouring investments with the potential for growth and flexibility to provide income can be an effective strategy for saving for such events.

    Are you saving for a specific goal, such as a deposit on a new home? Income earned on savings can be reinvested, and the accumulation of dividends over the long term should boost total returns.

    Why should you start planning for your future now? Retirement might seem like a long way off if you are in your early 20s, but the sooner you plan for it financially, the less you are likely to have to put aside. Planning for your financial future early in your working life will allow you to make longer-term and potentially more rewarding investments.

    If you are this kind of income investor, your typical income goals and attitudes to risk are:

    INCOME GOALS

    • School fees
    • University fees
    • Retirement
    • Help child onto property ladder
    • Career change
    • Business start-up

    ATTITUDE TO RISK

    • Focus on long-term investments with the ability to accept a higher level of risk
    • May be able to make additional investments as finances allow
  • Finding freedom

    Are you ready to start a new venture? You’ve spent years working and you’d like to start out on your own. Once you’ve accumulated a decent pot of capital, an income investment can help provide a regular income.

    Do you have a realistic view of your future income needs? Even though you no may no longer have a mortgage to pay during retirement, the other costs of living won’t differ dramatically from when you’re working. According to the Office for National Statistics (ONS) Family Spending 2014 survey, a retired couple in the UK spends £463 on average. By comparison, the average worker earns £474 per week.

    If you are this kind of income investor, your typical income goals and attitudes to risk are:

    INCOME GOALS

    • Retirement lifestyle
    • New hobbies
    • Travel
    • Living abroad

    ATTITUDE TO RISK

    • Focus on medium to high risk but with an eye on de-risking
    • Looking to generate income without excessive capital risk
  • Retirement ready

    Have you considered all the potential costs of your new lifestyle? People often find their expenses fall once their working life ends, but don’t automatically assume that all your expenses will go down – some may increase, such as heating and leisure costs.

    Do you plan to make further changes? If you have identified more than one main retirement goal, it’s worth considering the level of risk you are prepared to take and the income you need to support each goal. Would you be prepared to accept a higher level of risk for the proportion of your capital that is earmarked for funding a new hobby, for example?

    If you are this kind of income investor, your typical income goals and attitudes to risk are:

    INCOME GOALS

    • Retirement lifestyle
    • Travel
    • Living abroad

    ATTITUDE TO RISK

    • Typically, focus is on medium-risk investments
    • Need to avoid significant drawdown on capital
  • Careful comfort

    How long does your retirement income need to last? As people are living longer, their income needs are higher than in the past. ONS data suggests that in the UK, 1 in 3 babies born today are expected to celebrate their 100th birthday. While it’s difficult to put a number on how much you’ll need, a well-structured income plan can help fulfil requirements over the long term.

    Are you likely to face additional healthcare costs? Over the coming decades, many more people will require some form of part- or full-time care during retirement as life expectancy continues to rise.

    Are you thinking about providing for future generations? Leaving a legacy is not an exact science. However, adopting a balanced approach to financial planning throughout retirement could increase the chance of having something to leave behind.

    If you are this kind of income investor, your typical income goals and attitudes to risk are:

    INCOME GOALS

    • Estate planning
    • Additional healthcare costs
    • Full or part-time care

Discover your behavioural biases

Learn more about behavioural biases

 

Discover Schroders' income solutions

Asian Income

Equity income

Asian Income

Uses fundamental research to help unlock income opportunities in Asian markets

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FUND INFORMATION

Fast Facts

Global Equity Income

Equity income

Global Equity Income

Seeks to capture income by investing in global companies that represent good value

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FUND INFORMATION

Fast Facts

European Alpha Income

Equity income

European Alpha Income

Seeks to take advantage of income opportunities in European Markets

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FUND INFORMATION

Fast Facts

UK Alpha Income

Equity Income

UK Alpha Income

An 'all weather' income fund that adapts to approach according to economic conditions

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FUND INFORMATION

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Income

Equity Income

Income

A disciplined 'value investing' approach

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FUND INFORMATION

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Monthly High Income

High-yield bonds

Monthly High Income

Aims to exploit opportunities across the full spectrum of fixed income securities

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FUND INFORMATION

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Oriental Income Fund

Investment Trusts

Oriental Income Fund

Targets income and growth opportunities provided by the Asia ex Japan region

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FUND INFORMATION

Income Growth Fund

Investment Trusts

Income Growth Fund

Seeks to identify income and growth opportunities from UK companies

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FUND INFORMATION

Income Maximiser

Maximisers

Income Maximiser

A simple, innovative concept, designed for income-seeking investors

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FUND INFORMATION

Fast Facts

Asian Income Maximiser

Maximisers

Asian Income Maximiser

A compelling proposition for investors seeking income from Asian markets

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FUND INFORMATION

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Mixed Distribution Fund

Multi-Asset

Mixed Distribution Fund

A high income 'fund of funds' investing in a selection of Schroders' Maximiser and fixed income unit trusts

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FUND INFORMATION

Fast Facts

Global Multi-Asset Income

Multi-Asset

Global Multi-Asset Income

Offering the potential for sustainable income in an ever-changing world

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FUND INFORMATION

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MM Diversity Income

Multi-Asset

MM Diversity Income

A multi-manager solution aiming for inflation-beating income returns

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FUND INFORMATION

Global Real Estate Securities Income Fund

Real Estate

Global Real Estate Securities Income Fund

A compelling proposition for investors seeking income in global property

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Global Real Estate Securities Fund

Real Estate

Global Real Estate Securities Fund

Flexible access to quality property worldwide

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FUND INFORMATION

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The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Some funds invest solely in the companies of, or in property located in, one country or region. This can carry more risk than investments spread over a number of countries or regions. Investments in smaller companies can be less liquid than investments in larger companies and price swings may therefore be greater than in larger company funds. Investors in the emerging markets and the Far East should be aware that this involves a high degree of risk and should be seen as long term in nature. Exchange rates may cause the value of investments denominated in currencies other than sterling, and the income from them, to rise or fall.

© 2016 Schroders

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