Simpler super system needed
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.”
Recommended for you
Financial Services Council chief executive, Blake Briggs, is urging Minister for Financial Services, Stephen Jones, to take advantage of the QAR opportunity to reduce regulatory duplication and ensure advice is affordable.
Former chair of the House of Representatives’ Standing Economics Committee, Tim Wilson, is planning a return to politics after losing his seat in the 2022 federal election.
Morningstar is going to offer research ratings of funds in the $3.5 trillion superannuation sector for the first time in response to demand from financial advisers.
Treasurer Jim Chalmers has opened a consultation into the design of the annual superannuation performance test, canvassing views on a range of reform options.
