After a two-year delay the much-anticipated Retirement Income Covenant (RIC) is now on track to launch next July in a move destined to reshape the Australian superannuation fund universe.
First mooted in a May 2018 Treasury paper, the RIC was originally slated to go live in 2020 with new obligations for super funds intended to shift the market trajectory from accumulation phase to retirement income mode.
In the 2018 report preamble, Treasury noted: “The covenant will codify the requirements and obligations for superannuation trustees to consider the retirement income needs of their members, expanding individuals’ choice of retirement income products and improving standards of living in retirement.”
Better visibility of spousal super needed moneymanagement.com.au - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from moneymanagement.com.au Daily Mail and Mail on Sunday newspapers.
Super lobby ups ante against âregulatory kill-switchâ
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The governmentâs backflip on the superannuation performance test got a tick of approval by the sector, but lobby groups are pushing for a controversial measure that allows for ministerial influence over investment decisions to be axed.
The government revealed on Wednesday an updated approach it would use to benchmark the performance of superannuation funds, acknowledging that a prior method could have discouraged funds from investing in unlisted infrastructure and property.
The Australian Financial Review on Monday, the government has also done an about-face on the inclusion of administration fees as well as investment fees in the performance test, having conceded that dodgy trustees could game the system.
Women retire on average with a balance of $122,848 in super compared to men who, on average, retire with $154,453, according to the Association of Superannuation Funds Australia (ASFA).
Cost of retirement up in December moneymanagement.com.au - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from moneymanagement.com.au Daily Mail and Mail on Sunday newspapers.