Simple Ideas for a Complex Retirement

For at least a decade, there have been countless articles, presentations, commissions and even a Financial System Inquiry pointing out the problems with the current state of Australia’s retirement income system.

The issues relating to longevity protection, financial planning, generational inequity and fiscal policy appear to be well understood by academics and practitioners alike, yet here we in 2019 without a clear way forward. Recent consultations show that consensus is hard to achieve within the industry and flaws in ideas are easier to find than viable solutions. Also, there appears to be a default position across the industry that more innovation is required when it comes to retirement income products. This is generally thought to mean opening up the gates to a wide array of drawdown products in an attempt to provide retirees with features they do not currently have access to.

However, perhaps innovation can be achieved by taking a contrarian view and constricting rather than expanding possible retirement product sets. By taking such an approach, super trustees providing drawdown solutions may successfully leverage technology to move from a prescriptive to a facilitating role, as financial literacy is improved and retirees are empowered to make better-informed decisions.

In an article published by the Actuaries Institute, I provide a glimpse of my session at the upcoming Actuaries Summit in June. The article can be found here and my full paper can be downloaded here.