A recent report says we should focus on how to get the most from what Retirement Superannuation savings can deliver. At Financial Observer, Daniel Paperny writes –
In the wake of incoming reforms to superannuation tax concessions, the industry must shift its focus from accumulation to the retirement phase to help retirees make the most of their savings, according to a new KPMG and Challenger white paper.
Titled “Guiding members safely down a path in retirement”, the paper argues that the messaging around adequacy in retirement should refocus on engaging members on the importance of their super, and by extension the role of their super fund, throughout their later years.
“Without an understanding of what super can deliver in retirement, there is a danger that many people will discount the importance of super, relying only on the age pension instead of maximising and making the most of their savings,” the report states.
“Living off your super in retirement needs to be positioned as a solution and not a problem.”
The white paper argues that super funds face a “pressing” challenge to develop new products and solutions that integrate engagement and advice to meet the changing needs of fund members – including providing steady returns in the retirement phase in increasingly volatile market conditions.
“With the purpose of super clear in providing income throughout retirement, members need a safe path down the mountain,” the report states. “For funds that successfully achieve this, the result will be successful outcomes for retiring members and better engagement with members throughout their membership based on a clear understanding of the whole super journey.”
The white paper noted that while the government should be lauded for accepting many of the key recommendations of the Financial System Inquiry, there was still a lack of awareness among members surrounding the link between the investment success of their funds and their retirement benefits.
Too many members were disengaged, but KPMG and Challenger argued that this could change as the industry continued to mature and realised the need to provide better retirement solutions.
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