Study by the Melbourne Business School

What are the barriers that dissuade people from buying lifetime income streams annuities and how do we provide information, tools etc to help people better understand and responsibly eliminate their longevity risk for peace of mind in retirement. An ongoing donation by the Orford Foundation has enabled the prestigious Melbourne Business School to undertake a study to answer these key questions (and others) with results made publicly available.

Each retiree needs an income post-retirement that continues for their lifetime and that of their dependants or spouses if needed, and broadly keeps up with inflation. This is the main purpose of superannuation – a purpose that is not currently being fulfilled.

While annuities have been used for over 2,000 years, except for 4 countries in the world, they are not generally used in people’s retirements worldwide.

We need research that can show how best to help them make smart choices for a comfortable and secure retirement.

Lifetime income streams are not bought, they’re sold. How do we educate and convince a nation? Where is the so what? What we are putting together will be more of an overview of this piece of engaged research, and the educational outreach opportunities across podcasts, seminar/lecture series and quite likely, pitch opportunities for media articles. It will be an investigation of what will work to increase the intent to sell (hence financial planners are key) and for consumers to buy (build trust, reason-to-believe); and trialling interventions to see what actually does work.

On this topic of how to engage in order to shift attitudes, drive decision making and do this well, we would see this as a longitudinal research program and look to appoint a research fellow with psychology research background. This is an action research program that combines doing research but also includes direct intervention with partners to really determine what are the effective ways to overcome people’s resistance to lifetime income streams. As part of this, there could also be an Industry Thought Leadership Program, anchored by a Visiting Professor Series, spanning a series of events sharing research findings, facilitating debates and having Melbourne Business School lead the conversation nationally.

See the MBS Press Release

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