Retirement
‘Detrimental’: Treasury’s income product plans draw fire
Treasury’s plans for proposed retirement income products to be designed for sale without a professional advice requirement could be bad news for retirees, a financial planner has said.
‘Detrimental’: Treasury’s income product plans draw fire
Treasury’s plans for proposed retirement income products to be designed for sale without a professional advice requirement could be bad news for retirees, a financial planner has said.
Speaking at the Financial Services Council summit last week, Department of Treasury retirement income policy head Robert Jeremenko said comprehensive income products for retirement (CIPRs) should be built to allow clients to purchase them without receiving advice.
The government is currently working with consumer and industry groups to develop CIPRs aimed at addressing super fund members’ needs in retirement through annuity-style products.
According to Mr Jeremenko, these products should be available for sale without a requirement for clients to seek advice.
“The government wants to establish this in a way that the offer of a CIPR would not be financial advice, so that means we need to look at what the definition of intra-fund advice is going forward to accommodate that,” he said.
“In and of itself, the offer of a CIPR is not financial advice.”
However, speaking to Nest Egg sister site ifa, Lifespan Financial Planning chief executive Eugene Ardino said deregulation of CIPR advice is “not in the public interest” and could be damaging for retirees.
He explained that while anyone can invest in a product without advice, regulators’ role is to dictate who can advise on certain products and who cannot.
“So, what Treasury seems to be suggesting is that it be possible for anyone to advise on these investment products, including the person trying to sell it,” Mr Ardino argued.
“If you go with this suggestion then you would have the sales team of a super fund trying to sell these products to retirees and I’m sure I don’t need to explain the problems with this model.
“If you want to structure CIPRs so that clients won’t need advice then structure them so that they are simple, which is difficult as they are complex instruments.”
He said it won’t be any easier to stop savers from receiving CIPR advice than to force them to seek advice.
“All you can do is decide who can and cannot provide that advice and there is just no good reason to say that anyone can advise on CIPRs,” Mr Ardino said.
In line with Rice Warner’s calls for CIPRs to be classified as financial products, Mr Ardino said they shouldn’t be available without advice from qualified advisers – and not super funds’ sales teams.
“Let the fund provide objective factual information, which is allowed of any financial product, but leave the advice to advisers,” he said.
Retirement Planning
Empowering your future: Financial literacy and retirement planning in Australia
In today’s complex financial landscape, achieving a secure and comfortable retirement requires more than just saving money. It demands a deep understanding of financial concepts and the ability to ...Read more
Retirement Planning
How much do you need to retire comfortably in Australia?
Retiring comfortably in Australia is a goal shared by many, but achieving this requires careful financial planning and a clear understanding of the cost of living. Read more
Retirement Planning
Retirement planning advice for Australians: Avoiding common pitfalls
Retirement planning is a critical step in securing your financial future, but it's fraught with potential pitfalls that can derail even the best-laid plans. Read more
Retirement Planning
Mastering financial planning for retirement in Australia
Financial planning for retirement is a nuanced journey that requires careful consideration and strategic planning, particularly in Australia's unique financial landscape. Read more
Retirement Planning
Crafting your retirement planning spreadsheet in Australia
Retirement planning is a crucial aspect of financial management, especially in Australia where the landscape of superannuation and investments offers unique opportunities and challenges. Read more
Retirement Planning
Maximising your pension plan in Australia: Strategies for a comfortable retirement
In the ever-evolving landscape of retirement planning in Australia, securing a comfortable retirement through your pension plan has become increasingly important. Read more
Retirement Planning
Supporting our veterans: A guide to financial resources and benefits
Military veterans have made invaluable contributions to their country, and in recognition of their service, there are numerous financial resources and benefits available to support them in civilian ...Read more
Retirement Planning
The ultimate retirement planning checklist for Australians
Retirement planning is a multifaceted process that demands careful attention to financial, legal, and personal considerations. Read more
Retirement Planning
Empowering your future: Financial literacy and retirement planning in Australia
In today’s complex financial landscape, achieving a secure and comfortable retirement requires more than just saving money. It demands a deep understanding of financial concepts and the ability to ...Read more
Retirement Planning
How much do you need to retire comfortably in Australia?
Retiring comfortably in Australia is a goal shared by many, but achieving this requires careful financial planning and a clear understanding of the cost of living. Read more
Retirement Planning
Retirement planning advice for Australians: Avoiding common pitfalls
Retirement planning is a critical step in securing your financial future, but it's fraught with potential pitfalls that can derail even the best-laid plans. Read more
Retirement Planning
Mastering financial planning for retirement in Australia
Financial planning for retirement is a nuanced journey that requires careful consideration and strategic planning, particularly in Australia's unique financial landscape. Read more
Retirement Planning
Crafting your retirement planning spreadsheet in Australia
Retirement planning is a crucial aspect of financial management, especially in Australia where the landscape of superannuation and investments offers unique opportunities and challenges. Read more
Retirement Planning
Maximising your pension plan in Australia: Strategies for a comfortable retirement
In the ever-evolving landscape of retirement planning in Australia, securing a comfortable retirement through your pension plan has become increasingly important. Read more
Retirement Planning
Supporting our veterans: A guide to financial resources and benefits
Military veterans have made invaluable contributions to their country, and in recognition of their service, there are numerous financial resources and benefits available to support them in civilian ...Read more
Retirement Planning
The ultimate retirement planning checklist for Australians
Retirement planning is a multifaceted process that demands careful attention to financial, legal, and personal considerations. Read more