Older Aussies adverse to stock market risk

Retired Australians want financial security and peace of mind, but are worried about gambling their life savings on share market-dominated superannuation, research from National Seniors Australia’s new study shows.

It points to a failure of the superannuation system to help retirees safely convert their savings into reliable income that lasts a life time.

Professor John McCallum, National Seniors chief executive officer, said the study revealed the conflict experienced by many retirees who felt they had little option, but to continue ‘gamble’ in the share market, despite a low tolerance for risk.

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“When members reach retirement, the risk of managing their superannuation savings shifts from the super fund trustee to the retiree who may have little experience with this,” McCallum said.

“It is both a clear opportunity and a responsibility for the superannuation sector and government to reset the regulatory and product focus of superannuation to better meet the needs of Australian retirees.”

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Isn't it the responsibility of the retiree to seek advice or to educate themselves? Maybe if financial education was provided in schools and in the workplace this problem could be solved without the superannuation sector and government having to reset the regulatory and product focus of superannuation to better meet the needs of Australian retirees. Maybe get rid of the compliance overkill and red tape and make advice affordable again?

The trustee always has responsibility for managing investment risk. It is one of the important roles defined in super legislation. That why the PDS is required to discuss investment risks. Whether the account is in accumulation or pension phase does not change the trustee's role. The professor needs to go and study the topic a little more.

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