APRA data dispels retirement phase myth, Cooper says

31 May 2018
| By Nicholas Grove |
image
image
expand image

Recently released data from the Australian Prudential and Regulation Authority (APRA) shows that the retirement phase of superannuation should be a priority, Challenger’s chairman of retirement income and former Super System Review chairman, Jeremy Cooper, said.

APRA data showing that the average balances of over 1.6 million retired superannuation fund members was now over $250,000 dispelled the myth that retiree super balances were relatively small, he said.

“Many people are now accumulating super balances that will make a meaningful difference to retirement and there’s a need for the super industry to do more to help them spend down their money safely with cash flows that last for life,” Cooper said.

Due to the growth in super balances, he said many funds now managed assets for their retired members alone that ran into tens of billions of dollars, yet these assets were not distinguished from the assets of those still in the working phase of their life, even though retirees faced very different risks.

“The retirement phase of superannuation needs to be enhanced to better meet the needs of members. The retirement income framework is an effective way to achieve this by delivering more clarity and choice for Australian retirees,” Cooper said.

“Government proposals for a retirement income framework, including comprehensive income products for retirement (CIPRs), are a big step forward. They will be an enhancement, not a disruptive change. Retiring members will only get a CIPR if they purposely choose to have one.

“Even then, the product everyone has now, an account-based pension, will remain the major component of most CIPRs.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

10 months 2 weeks ago
Kevin Gorman

Super director remuneration ...

10 months 3 weeks ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

10 months 3 weeks ago

The fund’s inaugural chief retirement officer is looking to establish a new venture. ...

2 hours ago

The sovereign wealth fund remains cautious of the impact of high inflation as it announces a strong return in its latest update....

20 hours ago

In this latest edition, Anna Shelley, CIO at AMP, shares the fund’s approach to current market conditions and where it continues to uncover key opportunities....

21 hours ago