Higher inflation can put additional strain on pension schemes’ ability to pay out pensions as they fall due. There is an increased focus on cashflow, including developing “cashflow waterfalls”, to ensure that pensions can be paid without the scheme needing to sell assets, perhaps at an inopportune time. In addition, some schemes are looking to de-risk their investment portfolios and increase investment in productive finance. Secure income is an asset class that can potentially help solve several of these challenges.
