Arguably the “biggest issue” confronting Australia’s ageing population is whether it is prepared financially for its own longevity, according to the SMSF Academy.
Aaron Dunn, managing director of the SMSF Academy, told SMSF Adviser one of the “big ticket issues” facing the super industry includes the management of longevity, adding not all investors are adequately prepared financially.
“I think there’s a bit of work to be done … [perhaps] that’s why the government has started to look at these deferred annuities [and] the tax concessions around deferred annuities because there is a level of concern around how long the capital will actually last,” Mr Dunn said.
Mr Dunn added although self-managed super funds (SMSFs) traditionally have larger balances and may be in a better position than Australian Prudential Regulation Authority (APRA)-regulated funds, that doesn’t necessarily ensure their level of preparation.
“It really comes down to the living needs of individuals and basing that on their own particular circumstances,” Mr Dunn said.
“You’ve got to think about your own health and the probabilities of at least one in a husband and wife living for a lot longer,” he added.
Mr Dunn also drew attention to the importance of building a “pension plan,” saying historically the payment of pension has been “a set and forget”.
“It’s important that you have a pension or pensions that can adapt to the changing environment, changing markets [and] changing events that can happen to ensure that not only you get the best tax outcome for members, but also to ensure [the] best possible tax outcome when the money actually has to leave superannuation as well,” he added.
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 22 May 2017ATO sheds light on LRBA reporting requirementsBy Miranda Brownlee
- 22 May 2017Software provider releases super reform-focused servicesBy Jotham Lian
- 22 May 2017ATO poised to ramp up focus on key compliance areaBy Katarina Taurian
- 22 May 2017Caution advised on ATO’s new super balance toolBy Katarina Taurian
- 19 May 2017SMSF real-time reporting slated for FY2018-19By Miranda Brownlee and Katarina Taurian
- 19 May 2017Lawyer points to benefits of AFCA for SMSFsBy Miranda Brownlee
- view all
- Software provider releases super reform-focused services
BGL has announced the release of services, designed to deal with the 2016-17 superannuation reforms, that will help clients tackle the new C...read more
- ATO poised to ramp up focus on key compliance area
With 8 per cent of funds failing to meet their lodgement obligations for the last two years at least, the ATO is set to up its compliance fo...read more
- view all