Retirees need new super investment approach

 

The needs of retiree clients may not be properly serviced by traditional portfolio investment approaches, an investment expert has warned.

 

           

Traditional portfolio investment approaches for superannuation may fail to meet the needs of retiree clients, a retirement investment expert has warned.

Pointing out the bulk of superannuation assets in Australia now sit with people aged over fifty, Fidelity International head of client solutions and retirement Richard Dinham said financial advisers had to ensure traditional portfolio construction approaches evolved to meet this demographic’s financial needs.

“In Australia, the retiree client group is growing in size and it is essential that financial advisers have the right tools and resources to meet their particular needs,” Dinham said.

“As such it is important to understand the motivations and drivers behind the behaviour of retiree clients as they move from accumulation to decumulation.”

He highlighted Fidelity International’s recent research paper, “Building Better Retirement Futures”, developed in conjunction with the Financial Planning Association of Australia and CoreData in an effort to help financial advisers develop better investment strategies for their retiree clients.

“The paper outlines some of the key financial issues and considerations specific to retirees and helps advisers design the best strategies for post-retirement decumulation,” he noted.

“Financial advice is invaluable in helping retirees understand how long their money will last and what steps they can take to minimise the risk of outliving their savings.

“Determining the best strategy, or combination of strategies, is a significant part of the value a planner brings to the table.

“Advisers that understand the types of risk specific to retirees, the fears and challenges they face in retirement, how their needs differ from accumulators, and the strengths and weaknesses of different retirement investment strategies, will be best placed to help their clients throughout their retirement.”

In November, Allianz Retire+ chief executive Matt Rady said retirees needed a more innovative approach to investing than that offered by traditional investment portfolios in order to navigate the current low interest rate environment.

 

 

January 11, 2021
Tharshini Ashokan
smsmagazine.com.au

 

Want to know more?

Do you have a question about something you’ve read in this article? Need more information? Want to book an appointment? Simply let us know below and we’ll get back to you ASAP.

Share this article

Share on facebook
Facebook
Share on linkedin
LinkedIn
Share on twitter
Twitter
Share on email
Email

Recent Posts

Financial Planning

The rise of the female investor

 

While society continues to grapple with the factors driving gender and pay inequity, women are proactively turning to investing more than ever before. And in doing so, they are demonstrating a very competent and sensible approach to building up their wealth outside of superannuation.

 

Read More >
Financial Planning

Lockdowns and mental health

 

Victoria endures its sixth lockdown as the state's cases grow; NSW records 1,281 new local COVID-19 cases and three deaths. Lockdowns to be eased once 70% of the population is double vaccinated against COVID-19 yet today some 60% of Australians are in lockdown.

 

Read More >
Financial Planning

SMSFs go for growth

 

SMSFs are looking to invest more in equities and less in cash in this low-yield environment, according to the Vanguard/Investment Trends 2021 SMSF Investor report released last week.

 

Read More >