New deal for the age of income

Superannuation fund members have been well served by low-cost default products, thanks to legislative oversight and competitive returns. But once members switch to retirement phase, they find they are on their own and face the daunting task of choosing a suitable product.

Many retirees enter the drawdown phase with a sense of trepidation. They don’t know how long their super will last or how they will cope with unexpected emergencies.

Nor do they know how to navigate the financial landscape ahead of them, riddled as it is with complexities.

From July 1, the federal government’s Retirement Income Covenant (RIC) requires super funds to publish their retirement income strategies on their websites and outline how members can maximise their income, manage risks and have flexible access to their money.

Since the inception of compulsory super three decades ago, funds have focused primarily on the accumulation phase