Retirement income covenant

A joint review conducted by ASIC and APRA was scathing of funds’ collective attempts to meet their new legal obligation to help fund members plan for retirement, and urged them to “address, with urgency, the gaps in their approach”.

The superannuation industry is grappling with the complexity of delivering retirement solutions. Perhaps the only way to assess how well they work in the future is to start assessing them right now.

While the publishing of retirement income strategies is a big step forward into super’s new frontier, many of those strategies are based on a “very unsafe foundation.”

With the advent of the Retirement Income Covenant (RIC), super funds can finally move forward on the decumulation phase. But they shouldn’t try to “boil the sea.”

Funds should allow retiree members to request they select a retirement product on their behalf, and create “safety net provisions” for those who don’t, according to new research. New research by David Bell, executive director of the Conexus Institute, Geoff Warren, associate professor at the Australian National University, argues that relying solely on retirees to…