Frontier is pleased to provide this submission to Treasury’s consultation on Superannuation in retirement.
Frontier is one of Australia’s leading institutional investment advisers. We have been advising Australian institutional investors as a trusted adviser for almost thirty years. We provide advice on more than $660 billion of assets across the superannuation, charity, public sector, insurance and higher education sectors. The fact our advice is free of any product, manager or broker conflicts, means we can provide truly unconflicted advice aligned with our client’s best interests.
Frontier believes the implementation of the Retirement Income Covenant expedited some welcome progress but agrees the retirement phase of superannuation remains under-developed. We agree Australians need better access to information, advice, and well-rounded retirement income products to help them navigate the challenges retirees face.
As noted in the consultation paper, retirement may be characterised as “the nastiest, hardest problem in finance”. But Frontier believes there is a danger the solution is overcomplicated in striving for a perfect answer. Many retirees’ financial outcomes could be improved with a relatively simple solution.
We agree such solutions would see retirees with a higher income that is smooth across their life. While retirees may benefit further from a solution which is more tailored to their individual needs, there is a danger that striving for this solution initially will delay the implementation of a simple solution.
Similarly, individual financial advice shouldn’t be required for those retirees whose financial circumstances are relatively straight-forward. ‘Nudging’ superannuation members to draw down income more than the minimum rates is a simple step to improve retirees’ outcomes.
