Our types of investment funds

This video is for educational purposes only. This should not be viewed as advice or a recommendation to invest.

Ready-made funds make investing simple. The hard part is choosing from thousands of options. But once you know what to look for, it becomes clear. Today I’ll walk you through how to pick the right one for you.

The Investing Masterplan

Episode 6: Choosing the right ready-made fund for me

I’m Harriet Ballard, a multi-asset portfolio manager at Aviva. I’ve spent more than 15 years studying markets, keeping an eye on how the world is moving, and finding the best ways to make people’s money work harder. In the last episode, we established that investing can be made simple by using a ready-made fund. But how do you choose which ready-made fund is right for you? That’s what we’ll be exploring in this episode, the season finale. So, let’s get started. It’s time to see investing in a whole new light.

Chapter 1:

Growth vs income funds: Which fits your investment style?

When it comes to investing—whether in your pension or an ISA—there’s no such thing as a one-size-fits-all. Different strategies suit different people, and even for the same person, what works today might not be the right fit tomorrow. Our goals change, our timelines shift, and so should our approach. Let’s look at how that might play out across different stages of your life. As we know, investments can go down as well as up, so you may get back less than you’ve paid in, which is important to consider.

In your early career, when you’re in your 20s or 30s, you’ve got time on your side. The markets might go up and down, but with years ahead of you, you can usually ride out the bumps. And that’s why a ready-made fund focused on growth—such as our Multi-Asset plus with a high proportion of equities—could make sense. It gives your money the chance to grow steadily over the long term.

With mid-life goals, maybe you’re saving for a new home in a few years or planning ahead for your child’s education. Here, it’s all about balance of bonds and shares. You want enough growth to hit your target, but not so much risk that short-term volatility throws you off track. As you get closer to retirement, priorities shift. Preserving what you’ve built often becomes more important than chasing big returns. A more defensive mix with a greater focus on bonds and perhaps some alternatives can help cushion your portfolio.

Finally, ask yourself – are you looking for growth or income? Once you move into retirement, income funds can be a great option Unlike growth funds, which aim to build your money over time, income funds are designed to pay you a regular amount, a bit like a paycheck from your investments. These payments come from share dividends and interest. That’s why income funds are generally made up of shares in stable established companies and hold bonds which pay out a fixed interest payment over time. So if you aim for investments to give you steady payout, the income fund could be a really good fit.

Here’s the key: your strategy should evolve as your life does, what works at 30 won’t work at 60. Investing isn’t static, it’s a journey. The important thing is to keep checking in, making sure your money is still working in the way you need it to, wherever you are on that path.

Chapter 2:

Understanding risk vs reward

Let’s talk about risk and reward – they're two sides of the same coin. If your ready-made fund holds more equities, you’ve got more potential for higher returns. But that also increases the risk. You’ll see more ups and downs along the way, but your investments may wobble. If your fund holds more bonds, things tend to be more stable. But the trade-off is that your returns tend to be lower over time. But the question isn’t which is better, it’s which is better for you right now. Remember, investments can always go down as well as up, and you may get back less than you’ve paid in. That’s why understanding your horizon and your tolerance for risk is so important. If you’ve got plenty of time ahead before you need the money, you might be comfortable taking on a bit more risk for the chance of higher returns. But if your goal is closer, or you simply prefer a smoother ride, it might make sense to choose a more balanced or cautious approach. The key is understanding your balance.

Chapter 3:

Active vs Passive ready-made funds

We explored active versus passive investing in episode 3. Let’s do a quick refresher, because understanding the two can help you choose the right ready-made fund with confidence. Passive investing tracks the market by following an index like the FTSE 100. It’s generally lower cost and offers broad diversification, making it a popular choice for those who value simplicity and consistency. Active investing takes a more tailored approach. Professional managers actively select investments and adjust the portfolios to seize opportunities and manage risk, aiming to outperform the market over time. This can appeal to investors who want the potential for higher returns and a more personalised strategy.

With Aviva ready-made funds, you don’t have to choose one or the other. We combine active oversight with broad diversification so you can benefit from the simplicity and expert management.

Chapter 4:

What are the alternative assets and what do they offer?

There are thousands of ready-made fund options available, so when choosing one that’s right for you, it’s important to make sure it covers diversification from all angles. That means not just holding different asset classes, but also different assets from different countries. Let’s break it down.

When most people think about diversification, they usually picture stocks and bonds. That’s represented by the blue and green areas in these pie charts showing MAF Plus fund range. As you can see though, there is more to the picture and that’s where alternative investments come in. That’s represented by these yellow sections. These can include things like real estate, infrastructure and commodities, such as gold. Why do they matter? Because they don’t always move in the same way as traditional markets. Alternatives can add resilience to a portfolio. They help smooth out the ride when markets get a little bumpy. Over the long term, they can make a real difference to the stability and resilience of your investments. Another principle we follow is true global diversification. Unlike strategies that overweight their home market, our actively managed approach avoids home bias. In other words, we won’t overly invest in the country you live in. Why? Because concentrating too much in one country, whether it’s the UK or anywhere else can limit diversification and increase risk. Instead, we spread our investments across regions, sectors and asset classes all around the world. That way you can benefit from growth wherever it happens, not just close to home. So when you choose a ready-made fund, it’s worth checking whether it includes these types of diversification.

Chapter 5:

Making Investing more efficient

We’ve spent a lot of time talking about ready-made multi-asset funds, but what’s the alternative? Doing it yourself. That means building your own portfolio, choosing not just one fund but an equity fund, a bond fund and a way to invest in alternatives. You’d need time to research assets, decide which countries to invest in and rebalance regularly to keep your portfolio aligned with your risk tolerance. This can be time consuming and in many cases more expensive than a ready-made multi-asset fund. That’s why when choosing the right ready-made fund, it’s worth considering value. At Aviva, we’re committed to keeping costs competitive and delivering strong outcomes. As our funds grow and processes scale, we continuously look for ways to make investing more efficient. Because if you look after the pennies, the pounds will look after themselves.

And that brings us to the end of our series, The Investing Master Plan. Hopefully now you feel equipped with everything you need to know to help you choose the right ready-made fund for you. All that’s left to say is a huge congratulations. You’ve made it all the way through the series. Whether this is your first deep dive into investing or you’re refreshing your knowledge, you’ve taken a really important step in learning how to make your money work for you. Don’t forget you can always pop back to any of the earlier episodes if you want a quick recap. Plus there are plenty of helpful tools, guides and articles on Aviva’s website if you’d like to explore a little further. Thank you and good luck on your investment journey.

This video is for educational purposes only. This should not be viewed as advice or a recommendation to invest. Investing offers the potential for better returns than cash savings over the long term (5+ years). But there are risks, the value of your investments may go down as well as up, and you may get back less than invested. If you want advice on investment choices, then we’d recommend speaking to a financial adviser. There may be a charge for advice.