With the passing of the Retirement Income Covenant, there has never been a better time for advisers to position themselves as retirement advice specialists.
This is according to SuperEd chair Jeremy Duffield, who predicts that retirement planning will be a major focus of the 2022 Quality of Advice Review.
Advisers are said to be in the empathy business as much as in the finance business, he told a Vanguard event.
“In the real world, though, retirement is a transformative time of life and also a great opportunity for financial advisers,” he said.
With some 250,000 people retiring each year and Australia having 3.9 million people aged over 65 this is “a huge market of people either retired or thinking about retirement”.
Advisers have a key role to play in helping Australians align their retirement with their financial situation and therefore their own financial reality.
“That’s often very hard to do. It’s a major challenge to work out how long your money will last, and how much you can afford to spend,” he said.
Vanguard head of distribution Matthew Lumsden said: “Insights from our client base have demonstrated that while many investors preparing for retirement share common goals including building an income stream, balancing growth and risk, and maximising their savings to avoid outliving their wealth, it is an understanding of client attitudes and beliefs that can be most valuable to advisers.”
Super Consumers Australia director Xavier O’Halloran said the passage of the Retirement Income Covenant legislation yesterday calls for stronger impartial, quality financial advice provided on retirement options and products.
“To make the most of this, Australians will need to be better supported to navigate the complexity an increased product range will bring,” he said.