With two years of considerable discussion around the provision of new retirement income products, savvy trustees are realising it’s the perfect time to integrate retirement income products into the mix.
Funds may have had their focus diverted by The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services, the Productivity Commission plus the review of insurance arrangements – all inevitably leading to a slow-down in the development of new products until potential legislation requires funds to provide better post-retirement solutions.
But one thing is clear. Funds are charged with managing the retirement outcomes of millions of Australians and carry a duty to act in their members’ best interests.
Unfortunately, any delays may have adverse implications for both the sustainability of super funds themselves and the sustainability of retirement incomes for their retiring members. There will be around 600,000 Australians retiring over the next three years who may not have the retirement incomes they want or need.
Why lifetime retirement income products are the answer
Australians are living longer, and the retirement products currently offered by super funds are at best, only a partial solution and a poor or inadequate solution for those that live a long life. That’s why lifetime retirement income products with longevity protection are an essential option that trustees should provide for their members.