Research confirms investment settings
|
|
New research released by Australia’s largest superannuation fund, AustralianSuper, has confirmed previous findings that reducing investment risk exposure could be a mistake for Australians when they retire.
AustralianSuper chief executive Ian Silk said the research involved comparing the risks and benefits of the fund’s current default investment option against several other options and default models such as aged-based and target date pensions.
“One of the key findings of the review was that it [could] be detrimental for members to reduce their investment risk once they retire,” he said.
Silk said that as a result of the research, AustralianSuper had not only retained the balanced option as AustralianSuper’s default investment option for accumulation members, it had introduced an age-based default for its pension product.
He said the concept of “retirement income” as distinct from “retirement balance” had been central to the fund’s analysis.
Silk said that given most members’ long investment horizons, which increasingly continued beyond retirement, the review highlighted that it was important to invest with the objective of proving the highest possible retirement income for the longest possible period, rather than simply maximising the account balance at retirement.
AUTHOR
Mike Taylor
Recommended for you
Licensee Centrepoint Alliance has completed the acquisition of Brighter Super’s annual review service advice book, via Financial Advice Matters.
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
