The long-awaited Retirement Income Covenant comes into effect tomorrow and, with super funds unable to consider members personal circumstances, there s a view that its implementation could significantly impact the financial advice sector - but maybe not in the way you might immediately think.
The difficulty of designing products for decumulation is superannuation funds are unable to accurately predict how long members will need the funds, according to a panel, meaning members fear running out of money.
While greater availability of retirement income products is a positive, the three objectives of these products as set out in legislation don t necessarily reflect members needs or desires.