Generation Life sees advisers as critical to the launch of its new longevity products, as it enters a strategic alliance with BlackRock.
Earlier this month, the firm announced it had formed a strategic alliance with the world’s largest asset manager BlackRock to develop a range of holistic longevity products. These will help retirees transition from accumulation to decumulation via a sustainable income stream with longevity protection.
This is likely to include a product for advisers, a product for superannuation funds, and a product for platforms with launches expected later this year.
Commenting on the role of advisers in longevity solutions, Generation Life chief executive Felipe Araujo explained to Money Management where he sees them fitting.
“The role of the adviser is totally one that Generation Life backs and supports. Our longevity solution is exclusively available via advisers because we know that this period of life is extremely complicated, and an adviser can inform the client through that journey,” he said.
“But we know what has worked for previous generations won’t work for the next generation – the new generation wants to travel, they want to have an active retirement, they might want to fund education costs.”
“Advisers have a role in constructing a bucketing strategy that recognises retirees need exposure to riskier asset classes as they are in retirement longer than ever before. But what that bucketing strategy does not contain is a longevity solution, which is paramount to ensure retirees have the peace of mind to spend their money as they wish.”
He said it was “phenomenal” to have received the backing of BlackRock, which visited Australia to determine how it could work with firms here to enter the retirement market.
BlackRock president Larry Fink stated he wants his legacy to focus on “reinventing retirement”, and the firm has already partnered with life companies in the US on a product called LifePath Paycheck, which allows US individuals to convert their 401(k) retirement savings into a steady monthly income.
Elements of the existing LifePath Paycheck and GDG’s lifetime annuity products will likely feature in the to-be-launched products.
“It is phenomenal to have this backing – BlackRock is US$10 trillion, they are not going anywhere soon. We are asking Australians to trust us with their retirement savings, and it is important we can give them as much reassurance as we can.
“We want to have multiple products as we recognise one solution isn’t a silver bullet. We are not there yet; we will take our time as we don’t want to build a product that no one elects to use.”
