Advisers keen for clarity after government announces probe into retirement products

Earlier this week, ifa learnt that Treasury is expected to release a consultation paper in the coming weeks to strengthen the accessibility of retirement products.

Namely, while the intergenerational report revealed that total assets in the superannuation system are expected to continue to grow strongly over the next four decades, the government is expressing concerns over a noticeable reluctance among Australians to tap into their retirement savings.

As such, this new paper, announced by Treasury, is expected to canvass problems with financial advice, among other things.

Commenting on this announcement, Eugene Ardino, chief executive officer at Lifespan Financial Planning, told ifa that everyone in the community is interested in seeing this consultation paper, which, he noted, should hopefully provide clarity around where the government is coming from with respect to retirement products and their accessibility.

“I feel advisers play an integral part in helping Australians plan their retirement when given the opportunity, which includes helping them decide where to spend their retirement savings and what products to buy,” said Mr Ardino.

“While, obtaining advice is obviously more effective for consumers if they access it long before retirement, having an adviser to navigate trying to decide which retirement products best suit an individual’s unique circumstances, will also play a large part in the effectiveness of any new framework that is built.

“Therefore, it is important, in my view, that personal advice is made available to consumers who seek to purchase any new retirement products so they can assess the appropriateness of them.”

Mr Ardino stressed, however, that “it is imperative that this advice be accessed from an adviser” and one that is “not related to the product provider”. This, he said, is particularly important for new and untested products.

“As such, I feel that this creates an even larger need for personal advice from a fully qualified adviser to become more accessible for all Australians.”

According to the comments section on ifa, advisers are not pleased with the government’s latest announcement and many feel this new consultation paper is just another form of meddling into their affairs.

“More rubbish from Chalmers to sanction the total control and domination of advice by the industry fund sector,” said one reader.

Another added: “Many clients I have known over 20 years don’t spend their balance outright as their goal is to receive an income to sustain a comfortable lifestyle check and 2- to maintain their balance as much as possible which is a priority for 99 per cent of retirees. If this is not happening, they are NOT happy. Ignorant politicians should consult the industry before making wild assertions.”