POWERED BY MOMENTUM MEDIA
Demographic issue needs cashflow considerations
The super industry's efforts to resolve the baby boomer bubble has focused too much on asset allocation and product solutions rather than holistic solutions that start with advice and members' cashflow considerations.
Colonial First State senior executives said there had been an over-focus on developing a "silver bullet" to resolve the looming demographic challenge, when real solutions started with accessible and affordable advice.
Peter Chun, Colonial's general manager of product and investments, said retirees gravitated around their bank account and wanted the superannuation industry to provide flexible ways to manage their cashflow in retirement.
"I think industry has thought we'll build this great mousetrap," Chun said.
Cashflow considerations such as the minimum pension amount and the implications of aged care needed to be nutted out, they said.
Linda Elkins Colonial's executive general manager said banks could do more to support Australia's superannuation industry, as demographics changed, through their breadth of services.
"We are in a good position to listen to the voice of the customer," she said.
But legislative changes were needed to promote the development of suitable product solutions, according to Elkins.
Product was the final consideration in providing a retirement solution, Chun said. He said an allocated pension could provide the strong bedrock from which to manage member's cashflows.
It was more flexible and could be integrated with online banking compared to lifetime annuities, which were locked in and capital intensive, he said.
AUTHOR
Staff Writer
Money Management staff writers are writers who contribute to the website from time to time. If you would like to discuss the content contained within this article please contact us.
Recommended for you
The super fund announced that Gregory has been appointed to its executive leadership team, taking on the fresh role of chief advice officer.
The deputy governor has warned that, as super funds’ overseas assets grow and liquidity risks rise, they will need to expand their FX hedge books to manage currency exposure effectively.
Super funds have built on early financial year momentum, as growth funds deliver strong results driven by equities and resilient bonds.
The super fund has announced that Mark Rider will step down from his position of chief investment officer (CIO) after deciding to “semi-retire” from full-time work.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
76.97 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
76.46 3 y p.a(%)
3
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
51.13 3 y p.a(%)
4
Global X GlobalX FANG+ ETF
45.15 3 y p.a(%)
5
Select Baker steel Gold Institutional
43.78 3 y p.a(%)
