ASFA supports switch from general to product advice
Financial advice is crucial in helping retirees meet their retirement income goals, the Association of Superannuation Funds of Australia (ASFA) said.
In its submission to the Financial System Inquiry (FSI), ASFA said it supports initiatives such as higher education standards, the switch from general to product advice, and the continuation of intra-fund advice.
ASFA said it wants to guarantee that at least 50 per cent of Australians lead a ‘comfortable' retirement life by 2050.
It said the superannuation system needs to set long-term goals against which its progress can be monitored.
ASFA set four goals it wants achieved by 2050 to ensure government spending on retirement either through tax incentives or the age pension is sustainable in the long-term.
It wants to limit age pension and tax expenditures on super to less than six per cent of GDP. It also wants to cut the number of retired Australians depending solely on the age pension by half to 20 per cent.
ASFA wants to attain an income replacement rate in retirement for household disposable income of more than 65 per cent.
It also identified the lack of choice in flexible retirement income products to meet the different needs of Australia's retirees.
"For example, we know that when consumers choose an income stream product, they must be able to compare the costs benefits and risks relevant to their own individual circumstances," ASFA CEO Pauline Vamos said.
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