Ageing Australians rapidly shifting retirement planning

New research from Allianz Retire+ has shown that Australia's ageing population is rapidly shifting its retirement planning focus to income rather than accumulation.

The white paper suggested this change has seen financial advisers refining their advice offering to meet these changing needs.

"After conversations with countless advisers and super funds, we have identified a huge demand for education and clarification around new-era lifetime income solutions emerging in the market," Allianz Retire+ chief product and marketing officer Simon Aboud said.

"It's clear that this is an area clients are increasingly asking about and that advisers and super funds are now looking to develop clearer positions on. The whitepaper examines the factors driving this interest, it also debunks several myths and sets up a framework through which advisers can lead the conversation around retirement income management with their clients."

Aboud said that while retirement planning has historically focused on helping clients accumulate wealth, as the population lives longer, the retirement journey has evolved.

"A new mindset has emerged - one that focuses not on only accumulation, but on a reliable and sustainable income stream," he said.

"Until recently, the range of super-based retirement income strategies in Australia has been limited, increasing the likelihood of retirees resorting to suboptimal self-insurance measures, such as frugality, to stretch their savings."

Aboud said one of the biggest fears retirees have is running out of money, either because they outlive their savings or because it is eroded by external factors like inflation or market volatility.

"Since the Superannuation Guarantee was introduced in 1992, Australians have gained a decade of life expectancy. That's an extra 10 years to fund, an additional 10 years of income to source," he said.

"Being able to grow retirement savings while reducing or limiting investment risk and securing the certainty of a stable and sustainable guaranteed income for life is becoming increasingly important to Australian retirees."

The whitepaper found while traditional, less-flexible annuities have a role to play, a strong focus on simplification ensures new-era lifetime income solutions have a user-friendly approach.

In addition, it said retirement income planning should include growth potential and protection.