Financial advisers need specialist accreditation in the post-retirement income space to tackle the complex challenges awaiting the burgeoning baby boomer cohort heading towards retirement.
That is the view of the Association of Superannuation Funds of Australia's (ASFA) chief executive, Pauline Vamos, who said that while advisers have not had a need to provide extensive advice in this space before, this is no longer the case.
"It's a complex area, and we think there should be a specialist accreditation because people do need individual, full personal financial advice," Vamos said.
Vamos believes advisers' understanding of annuity products is still low because the demand for it has not existed, and they have not had to sell them.
Vamos also argued longevity risk product definitions should be expanded so that it is still seen as a product that supplements age pension rather than replace it.
"But it's not just about annuity products. Retirement advice is about understanding funding of aged care, access to social security, and many other significant issues around retiring, particularly for couples," she said.
Investment Trends research showed fewer than one in five Australians feel they have enough money to cover their aged care costs, which presents an opportunity for advisers to facilitate discussions in this area.
Comments
Another day, another accreditation. Ms Vamos makes a media comment a day, more voice than Alan Jones. What does she think advisers have been doing for the last 20 years? Ignoring post retirement needs and not studying/researching what the trends are? If anything advisers have had to create their own devices for helping clients in this area, because ASFA members have been so slow to produce tools or products to assist. They just don't get it. Does she not read the stats on Flow to SMSF's - surely this is ASFA under Ms Vamos's failing? And on Annuities, we are at 25 year lows in interest rates, and you want more of clients to lock in? That would suit the funding needs of big insto's nicely - having to pay out with nil inflation linked income over 20+ years, when the normalised rate on which they can earn interest will likely be much higher. Are we fools Ms Vamos?
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