Retirement Really is Different

Australia's retirees are living longer, saving more and becoming increasingly self-reliant. Superannuation is moving from supplementing the age pension to substituting it for an increasing proportion of retirees, with only 42% of over-65s on a full age pension. This is forecast to decrease as super increasingly reduces the need for government assistance. Australia's super system is more mature than most people realise, with typical household superwealth at retirement in the $350,000-$500,000 range and increasing.This wealth was accumulated to provide income in retirement, partly by consumption of capital. This conflicts with the standard wealth management model which assumes the preservation or growth of capital. Financial risks and challenges in retirement are substantially different from the accumulation phase of super. This should be considered by the Financial Adviser Standards and Ethics Authority (FASEA) in its consultation on standards and training for financial advisers