Pensions now matching lump-sums
The days of lump sums being dominant in superannuation fund draw-downs may be over, with pension payments now matching lump sums for the first time, according to the Australian Prudential Regulation Authority (APRA).
The APRA annual report, tabled in Parliament this week, has revealed that while, historically, most benefits have been paid in the form of lump sums, this changed for the first time in the 2015/16 financial year.
It said that for the first time, annual pension payments matched lump sum payments.
However, the APRA annual report has also pointed to the challenges that went with increasing numbers of Australians reaching the draw-down phase of their superannuation, noting that the net outflow ratio for APRA-regulated funds continued an upward trend in 2016, reflecting the increasing level of benefit payments.
"This shift is expected given Australia's ageing population, with a growing number of members reaching retirement age and beginning to draw down on their superannuation assets," it said.
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