SMSF sector well placed on retirement incomes' adequacy
Though retirement savings' adequacy has been tipped as the superannuation industry's next area of legislative focus, self-managed super funds (SMSFs) already have their house well and truly in order, according to Andrea Slattery, chief executive of the Self Managed Super Funds Professionals' Association.
"The SMSF sector is the only one that doesn't have a problem with adequacy and longevity and sustainability," she said.
"In fact, the SMSF sector is actually one segment of the industry that can show some great systems in this space, how they're working, and how they can lead the way in some of the products and measures that can be introduced."
However, the issue is a serious one, according to Slattery, who pointed out that where a significant number of members in APRA-regulated funds took lump sum benefits upon retirement, SMSF members tended to maintain their balances throughout pension phase.
"They have a greater understanding that it's their money they've saved," she said. "So they continue that in a pension phase - continue to look after it appropriately and continue to make it work for them in the future.
"We already have a very good pension system in the SMSF sector and we already have a very good system for post-retirement options," Slattery continued. "These are clearly the areas that will be looked at going forward.
"The SMSF sector has some very good examples and very good methodologies that could well assist with underpinning how other sectors move forward in this area as well."
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