Income Solutions for Life

At Legg Mason, our proven income solutions across a full suite of equity, fixed income and multi-asset funds are purposefully designed to meet your clients' future needs. With our range of investment affiliates providing in-depth expertise, we enable you to actively respond to changes in plans or circumstances.

We enable you to actively respond to changes in plans or circumstances

Income Solutions White Papers

  • Introduction to Income Investing

    Income investing in a

    low interest rate world

    We are now in a world where interest rates are at record lows and the reality is that they are likely to remain so for some time to come.
    To earn the same dollars of income from Term Deposits today requires an investment of up to four times as much as it did in 2008.


    Key take-aways

    1.

    Term Deposits falling short of living expenses

    In 2010, one of Australia's leading banks offered its customers a 5 year Term Deposit rate of 8%. Today that same bank is offering less than 3% on a 5 year Term Deposit rate. This means that investors in income products are looking for income streams that will allow them to maintain their living standards.

    2.

    Inflation protection is a critical ingredient in any income solution

    With a relatively fixed capital base, inflation protection should be a central consideration in any retiree's medium to long-term financial plan. Over the past 20 years, income needed to grow a total of 63% to offset the loss of purchasing power from inflation.

    3.

    We are living longer, so growth of income matters

    As every year passes Australians are living longer and this trend is forecast to continue. As we live longer there is growing risk that we outlive our savings – this is known as longevity risk. By 2025, a man aged 60 can expect to live another 27.9 years and a woman 30.3 years.

  • Income Diversification Matters

    Income diversification matters:

    broadening your horizons

    Sticking to the well-worn path of Term Deposits and annuities will not provide for the comfortable lifestyle that income investors seek. It is time for income investors to ‘rethink’ their approach to investing. This means turning some of the traditional portfolio construction approaches on their heads.


    Key take-aways

    1.

    Australia is re-born as a diversified economy

    Many commentators still, incorrectly, view Australia as a resources dominated market. The reality, however, is very different.

    2.

    Redefining the ‘risk/return’ question

    While conventional portfolio construction wisdom dictates that to achieve a higher return we need to take more risk, that is not the case when the objective is to generate a sustainable and growing income stream.

  • Sustainable Income Generation

    Australian equity:

    a compelling case for income

    When the investment objective is primarily focused on sustainable income generation, we believe your money should be managed differently compared with a typical equity strategy.


    Key take-aways

    1.

    The world's best payout ratios

    Australian payout ratios over the past 15 years have averaged over 60%, which is well above other developed economies.

    2.

    AAA rated and positioned to perform

    According to the International Monetary Fund (IMF), when the debt of a nation exceeds 60% of its annual production (GDP) then economic growth is no longer sustainable and future growth is compromised. Australia is the only AAA rated country to exhibit a high expected divided yield and have very low debt to GDP.

  • Real Assets

    Real assets: the sweet spot of

    sustainable income

    Assets such as property, infrastructure and utilities provide a tangible investment linked to the real economy, where income can grow ahead of inflation, minimising income risk. For the income investor, listed real assets are the missing link between equities and fixed income.


    Key take-aways

    1.

    Real assets, real growth

    By investing real assets investors can hedge against future price rises to a significant degree. For example: since 1983, retail sales have grown by 2.5% p.a. above the inflation rate of 3.6% p.a.

    2.

    Population growth driving real asset growth

    One of the key drivers of real asset growth is population growth. Australia is projected to experience a 50.6% population growth between now and 2050. The largely monopolistic nature of infrastructure assets allows them to benefit directly from population growth, as more people use these fixed assets.

Our Range of Income Solutions

Target your income the reliable way



Legg Mason Martin Currie

Real Income Fund

Real Income from real assets

In a low growth, low interest rate world is it time to introduce your clients to an innovative and award-winning Australian real income fund?

Launched in 2010, the Legg Mason Martin Currie Real Income Fund is the first of its kind and has been carefully designed to provide attractive and growing income.

Tell me the benefits

  • Invests in a unique blend of liquid, ASX-listed real assets (property, infrastructure and utilities)
  • Low volatility risk target compared to the sharemarket (S&P/ASX 300 Index)
  • Targets an attractive income stream with future growth above inflation
  • Reinvests capital gains to boost future income potential
  • Independent research ratings: 'Recommended' by Lonsec and Zenith

Fund Insights

Andrew

Andrew Chambers
Portfolio Manager,
Martin Currie Australia

Related Resources

Ratings

Recommended - Lonsec Research Zenith Investment Partners - Recommended

A highly rated fund for a growing income stream



Legg Mason Martin Currie

Equity Income Fund

Sustainable income stream

In a world of low interest rates equity income funds have become one of the most effective ways to boost your client's income potential. The Legg Mason Martin Currie Equity Income Fund aims to deliver attractive and sustainable income by investing in Australian companies that we believe have high-quality business models and solid track records of paying dividends through the business cycle.

What are the key benefits for your clients?

  • 'Highly Recommended' by Lonsec
  • Aims to grow its income stream above inflation
  • Invests in ASX listed companies paying attractive dividends
  • Offers franking benefits for 0% tax payers
  • Lower risk than direct share portfolio

Fund Insights

Reece

Reece Birtles
Chief Investment Officer,
Martin Currie Australia

Related Resources

Ratings

Highly Recommended - Lonsec Research Zenith Investment Partners - Highly Recommended Morningstar - 5 star

Responsible Manager of the Year 2017



Legg Mason Martin Currie

Ethical Income Fund

Income: the ethical way

The strategy has an ethical screen where Environment, Social, Governance (ESG) analysis is incorporated into quality assessment and stock selection. There is also a screen for business involvement in unethical industries and ESG Impact screens - for assessment of corporate behavior.

What are the key benefits for your clients?

  • ESG embedded into investment process
  • Values screen designed to avoid certain sectors and stocks
  • Focus on delivering attractive and growing income
  • Porfolio managed to maximise after tax efficiency
  • Winner of Responsible Investment Manager of the Year 2017

Related Resources

Ratings

Highly Recommended - Lonsec Research Zenith

An innovative retirement income solution investing in multiple asset classes



Legg Mason Martin Currie

Diversified Income Fund

A one-stop retirement income solution

Designed for retirees seeking a 'balanced fund' style solution that is diversified across asset classes. The Legg Mason Martin Currie Diversified Income Fund provides a ready-made solution that invests in a blend of Australian real asset income, equity income and fixed income. This blended fund takes the hassle out of managing three separate investments.

What are the key benefits for your clients?

  • 'Recommended' by Lonsec
  • Diversification across asset classes
  • Dedicated, experienced investment managers in each asset class
  • Active asset allocation between sectors and active security selection within each sector
  • Diversification benefits that would be difficult to achieve through direct investment

Related Resources

Ratings

Zenith Investment Partners - Recommended Recommended - Lonsec Research Morningstar - 5 star

Total return with income focus

Legg Mason Brandywine

Global Income Optimiser Fund

Investment Objective

The Fund's investment objective is to seek to generate a high and consistent level of income in all market conditions over a full market cycle with a secondary objective of capital preservation.

Key Features

The Legg Mason Brandywine Global Income Optimiser Fund is a flexible global bond fund that aims to generate attractive income and preserve capital by utilising all the levers available with a truly multisector approach.

  • Global opportunity set
  • Flexible multi-sector approach
  • Top-down driven, value orientated strategy
  • Seeks to mitigate downside protection
  • Potential for attractive and reliable income

Related Resources

Fixed Income Choice

Legg Mason Western Asset
Cash Fund

Read more

Legg Mason Western Asset
Cash Plus Fund

Read more

Legg Mason Western Asset
Australian Bond Fund

Read more

Legg Mason Western Asset
Global Bond Fund

Read more

Legg Mason Brandywine Global
Fixed Income Fund

Read more

Legg Mason Brandywine Global
Opportunistic Fixed Income Fund

Read more

Legg Mason Western Asset
Macro Opportunities Bond Fund

Read more

Contact Us

For general enquiries call 1800 679 541 or email us enquiries@leggmason.com.

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Legg Mason Asset Management Australia Ltd (ABN 76 004 835 849 AFSL 240827) is part of the global Legg Mason Inc. group. Any reference to Legg Mason or Martin Currie Australia is a reference to Legg Mason Asset Management Australia Limited. Martin Currie Australia is a division within Legg Mason. Legg Mason is the Responsible Entity of the Legg Mason Martin Currie Real Income Fund (ARSN 146 910 349)( Fund), Legg Mason Martin Currie Equity Income Fund (ARSN 150 751 821) (Fund), Legg Mason Martin Currie Diversified Income Fund (ARSN 169 461 116) (Fund). Martin Currie Australia is the investment manager of the Fund and Funds. Any reference to 'Brandywine' is a reference to Brandywine Global. Brandywine Global is the investment manager of the Legg Mason Brandywine Global Income Optimiser Fund (ARSN 618 213 488). Any reference to 'Brandywine' is a reference to Brandywine Global. Brandywine Global is the investment manager of the Legg Mason Brandywine Global Income Optimiser Fund (ARSN 618 213 488). Before making an investment decision you should read the Product Disclosure Statement (PDS) for the relevant Fund or Fund carefully. The PDS is available and can be obtained by contacting Legg Mason on 1800 679 541 or at www.leggmason.com.au . This product has not been prepared to take into account the investment objectives, financial objectives or particular needs of any particular person. Neither Legg Mason, nor any of its related parties guarantees any performance or the return of capital invested. Past performance is not necessarily indicative of future performance. Investments are subject to risks, including, but not limited to, possible delays in payments and loss of income or capital invested. These opinions are subject to change without notice and do not constitute investment advice or recommendation.

The Lonsec Ratings (assigned as follows: Legg Mason Martin Currie Real Income Fund - April 2017; Legg Mason Martin Currie Equity Income Fund – October 2017; Legg Mason Martin Currie Diversified Income Fund – December 2016) presented in this document are published by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL421445. The Ratings are limited to “General Advice” (as defined in the Corporations Act 2001 (Cth)) and based solely on consideration of the investment merits of the financial products. Past performance information is for illustrative purposes only and is not indicative of future performance. They are not a recommendation to purchase, sell or hold Legg Mason Asset Management Australia Limited products, and you should seek independent financial advice before investing in these products. The Ratings are subject to change without notice and Lonsec assumes no obligation to update the relevant documents following publication. Lonsec receives a fee from the Fund Manager for researching the products using comprehensive and objective criteria. For further information regarding Lonsec’s Ratings methodology, please refer to our website at: http://www.lonsecresearch.com.au/research-solutions/our-ratings

The Zenith Investment Partners ("Zenith") Australian Financial Services License No. 226872 rating (Legg Mason Martin Currie Real Income Fund assigned June 2017; Legg Mason Martin Currie Equity Income Fund assigned June 2017; Legg Mason Martin Currie Diversified Income Fund assigned October 2017) referred to in this document is limited to "General Advice" (s766B Corporations Act 2001) for Wholesale clients only. This advice has been prepared without taking into account the objectives, financial situation or needs of any individual and is subject to change at any time without prior notice. It is not a specific recommendation to purchase, sell or hold the relevant product(s). Investors should seek independent financial advice before making an investment decision and should consider the appropriateness of this advice in light of their own objectives, financial situation and needs. Investors should obtain a copy of, and consider the PDS or offer document before making any decision and refer to the full Zenith Product Assessment available on the Zenith website. Past performance is not an indication of future performance. Zenith usually charges the product issuer, fund manager or related party to conduct Product Assessments.Full details regarding Zenith's methodology, ratings definitions and regulatory compliance are available on our Product Assessments and at http://www.zenithpartners.com.au/RegulatoryGuidelines.

© 2017 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. Any general advice or 'class service' have been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement (Australian products) or Investment Statement (New Zealand products) before making any decision to invest. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product's future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782 ("ASXO").

The Morningstar Rating is an assessment of a fund's past performance – based on both return and risk – which shows how similar investments compare with their competitors. A high rating alone is insufficient basis for an investment decision.

Legg Mason Martin Currie Equity Income Fund and Legg Mason Martin Currie Diversified Income Fund received a 5-star Morningstar Rating™ as at 30 September 2017.

Important Note: You should read the information contained in the "Terms & Conditions" and "Privacy Policy" pages in this website before proceeding. Legg Mason Asset Management Australia Limited, ABN 76 004 835 849, AFSL No. 240827 ("Legg Mason Australia").

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