Retirement income adequacy trumps bequests to kids


Having a constant stream of regular income to cover essential needs has trumped leaving money to the kids, according to new research conducted by National Seniors Australia.
The research, published by annuities specialist company, Challenger, found that leaving money for the kids is no longer a top priority for older Australians with just 23 per cent of respondents rating it very important and only three per cent intending to preserve all their savings for an inheritance.
Challenger claimed these findings debunked the popular conception that leaving a financial legacy was a major concern for retirees.
“It’s time to put the inheritance myth to rest,” Challenger retirement income chair, Jeremy Cooper said. “Retirees have spoken and it’s clear that bequests are not the priority that many think they are. The need for regular income to avoid running out of money and, to pay for aged care and medical costs, is far more important for older Australians.”
“Bequests are not central to planning for their retirement and senior Australians are weighing these up against other trade-offs they must make to deal with longer lifespans,” National Seniors research director Professor John McCallum said.
“Having a constant stream of regular income to cover essential needs is the top priority for over 50s – 84 per cent rated it very important,” McCallum said.
Recommended for you
A financial advice firm has been penalised $11 million in the Federal Court for providing ‘cookie cutter advice’ to its clients and breaching conflicted remuneration rules.
Insignia Financial has experienced total quarterly net outflows of $1.8 billion as a result of client rebalancing, while its multi-asset flows halved from the prior quarter.
Prime Financial is looking to shed its “sleeping giant” reputation with larger M&A transactions going forward, having agreed to acquire research firm Lincoln Indicators.
An affiliate of Pinnacle Investment Management has expanded its reach with a London office as the fund manager seeks to grow its overseas distribution into the UK and Europe.