A simpler superannuation system would allow financial advisers to determine how to best access the retirement income system, according to IOOF.
In a submission to the Government’s Retirement Income Review, IOOF said the complexity of the super system often led to individuals needing an adviser.
“With a simpler system, financial advisers could focus on helping individuals understand what retirement means for them, rather than simply how to retire,” the submission said.
“That is, advisers should focus on what individuals can afford to spend in retirement and what lifestyle they can achieve, rather than simply how to interact with the system to receive an income stream.”
IOOF noted that as Australia’s defined contribution super system was relatively unique it needed to be focused on individuals rather than a pool.
“Individualisation creates a connection between retirement savings decisions and individual sacrifice, as their retirement balance is directly impacted by reductions in current day salary or foregoing current expenditure,” it said.
“This individualised retirement saving process needs to be reflected through a system focussed on the individual rather than pooling.”