Focus advice on pension phase: Burgess

Focus advice on pension phase: Burgess

Trustees and practitioners should not lose sight of the importance of advice once they have transitioned from accumulation to pension phase, says AMP SMSF’s Peter Burgess.

Receiving advice on investment strategy can be more important in pension phase than in accumulation phase, said Mr Burgess.

“I think there is a growing acknowledgement of… how important [it is] to seek advice around your investment strategy and it’s even more important when you move into the pension phase rather than the accumulation phase.”

“I think some people lose sight of that sometimes, that just because they’ve gone into the pension phase they [think they] don’t need the same level of advice as perhaps they did in the accumulation phase,” Mr Burgess said.

There are additional requirements in the pension phase in terms of the fund being able to generate cash and pay necessary pensions, which may call for professional guidance, Mr Burgess added.

“When [trustees] move from the accumulation to pension phase there’s obviously a need to ensure the fund has the required liquidity to pay pension payments, so there’s the need to ensure the fund investments are generating the required amount of liquidity,” Mr Burgess said.

“[Trustees] need to be mindful that they may be in the pension phase for quite a while and because of that there is a need to stay invested rather than cashing up,” he added.

“You need to ensure that you’re addressing longevity, and that the asset allocation is appropriate.”

Focus advice on pension phase: Burgess
smsfadviser logo
promoted stories

SUBSCRIBE TO THE SMSF ADVISER BULLETIN

Strategy