Advisers embrace guaranteed lifetime income products in response to Australia’s changing retirement needs

Transforming Retirement Planning: Advisers embrace guaranteed lifetime income products in response to Australia’s changing retirement needs. 

• Allianz Retire+’s latest whitepaper highlights the growing demand for guaranteed lifetime income products as Australia prepares to meet the needs of an ageing population who are living longer.
• The Retirement Income Covenant has put the need for innovation in retirement income products firmly in the spotlight and as a result the focus is shifting from accumulation to securing sustainable income streams.
• Despite the increasing size of super retirement balances, research shows money worries continue to be a leading cause of anxiety for older Australians.
• Access to guaranteed lifetime income products minimises or eliminates common risk factors such as longevity and market risk and improves retirement outcomes.
• Reframing the guaranteed lifetime income conversation will be a key advantage for those with a willingness to embrace change.
• Actionable strategies are needed to assist financial advisers in talking to clients about guaranteed lifetime income.

Sydney, Australia (18 June 2024): Allianz Retire+ today released a new whitepaper that has shown Australia’s ageing, and longer living, population is rapidly shifting its retirement planning focus to income rather than accumulation, with advisers now refining their advice offering to meet Australia’s changing retirement needs.

 “After conversations with countless advisers and super funds, we have identified a huge demand for education and clarification around new-era lifetime income solutions emerging in the market.

“It’s clear that this is an area clients are increasingly asking about and that advisers and super funds are now looking to develop clearer positions on. The whitepaper examines the factors driving this interest, it also debunks several myths and sets up a framework through which advisers can lead the conversation around retirement income management with their clients,“ Chief Product and Marketing Officer, Simon Aboud, said.

“While retirement planning has historically focused on helping clients to accumulate wealth, as lifespans lengthen and retirement journeys evolve, a new mindset has emerged - one that focuses not on only accumulation, but on a reliable and sustainable income stream.”

Allianz Retire+’s longevity solution Allianz Guaranteed Income for Life (AGILE), was released in 2023 with a view to providing much needed innovation, and offering a guaranteed lifetime income product that incorporates a combination of features previously unavailable in Australia.  This combination of features could only be made available through the scale and backing of the global Allianz business. These include:

• A guaranteed income stream, for life
• Access to capital
• Protection against market volatility while still offering capital growth potential
• Protected exposure to market movements.

“Until recently, the range of super-based retirement income strategies in Australia has been limited, increasing the likelihood of retirees resorting to suboptimal self-insurance measures, such as frugality, to stretch their savings,” Mr Aboud said.

“One of the biggest fears retirees have is running out of money; either because they outlive their savings or because it’s eroded by external factors such as market volatility or inflation.

“Since the Superannuation Guarantee was introduced in 1992, Australians have gained a decade of life expectancy. That’s an extra 10 years to fund, an additional 10 years of income to source.

Being able to grow retirement savings while reducing or limiting investment risk and securing the certainty of a stable and sustainable guaranteed income for life is becoming increasingly important to Australian retirees.”

New-era lifetime income solutions

• While traditional less-flexible annuities have a role to play, a strong focus on simplification ensures new-era lifetime income solutions have a user-friendly approach to customer experience, with intuitive design and easily understood features.
• Retirement income planning should (and can) include growth potential and protection.
• You no longer need to make a choice between guaranteed income and access to capital or flexibility.
• When presented to clients, or when the question is reframed to specify guaranteed lifetime income, clients do want the features offered.

The whitepaper also includes tips and suggestions to help advisers engage with their clients in relation to retirement planning.

-ENDS-

Media contact:


Kate Hallman P: 0413 946 704 E: kate.hallman@secnewgate.com.au

To download your copy of the full whitepaper, click here.

About Allianz Retire


Allianz Retire+ delivers the next generation of retirement income solutions to the Australian market. Our financial product solutions are designed to simplify the complex financial and emotional challenges that can confront people who are heading into retirement. Allianz Retire+ is a world-first Australian venture combining the scale and expertise of international insurance provider Allianz and global investment expert PIMCO.

Disclaimer

This material is issued by Allianz Australia Life Insurance Limited, ABN 27 076 033 782, AFSL 296559. Allianz Retire+ is a registered business name of Allianz Australia Life Insurance Limited.  This material has been prepared by Allianz Retire+ for general information purposes only. It is not comprehensive or intended to give financial product advice. Any general advice provided in this material does not take into account your objectives, financial situation or needs. Before acting on anything contained in this material, you should speak to your financial adviser and consider the appropriateness of the information received, having regard to your objectives, financial situation or needs. No person should rely on the content of this material or act on the basis of anything stated herein. Allianz Retire+ and its related entities, agents or employees do not accept any liability for any loss arising whether directly or indirectly from any use of this material. Use of the word ‘guarantee’ in this material refers to an assurance that certain conditions or contractual promises will be fulfilled by Allianz Retire+ from the available assets of its Statutory Fund No 2, in relation to the product terms. This includes ‘guaranteed’ income payments in the Lifetime Income Phase which will be paid from the available assets of Statutory Fund No 2, noting that Allianz Retire+ may terminate the product in certain limited circumstances as outlined in the Product Disclosure Statement referred below. Allianz Australia Life Insurance Limited is the issuer of Allianz Guaranteed Income for Life (AGILE). Prior to making an investment decision, investors should consider the relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) which are available on our website (www.allianzretireplus.com.au). PIMCO provides investment management and other support services to Allianz Retire+ but is not responsible for the performance of any Allianz Retire+ product, or any other product or service promoted or supplied by Allianz. Use of the POWERED BY PIMCO trademark, or any other use of the PIMCO name, is not a recommendation of any particular security, strategy or investment product.