Move to defined contributions super pays off for Australia
While many Australians may still pine for the old defined benefits superannaution regime, Mercer senior partner Dr David Knox believes Australia was significantly advantaged by moving early to defined contributions.
Discussing the issue as part of the analysis around the release of the Mercer Global Pension Index, Knox said the early move to defined contributions made Australia a trail-blazer and that it was a trend now being followed elesewhere in the world.
"The conversion of DC benefits into adequate and sustainable retirement incomes remains a largely unresolved problem in many countries, including Australia," Knox said.
"As countries grapple with rising life expectancies, increased government debt, uncertain economic conditions and a global shift to DC plans, there are still many lessons to be learnt and new solutions to be found, particularly for the post-retirement years.
"Developing effective and sustainable post-retirement solutions has to be one of the most critical challenges for policy makers and retirement industries around the globe."
Originally published on SMSF Essentials.
Recommended for you
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
The second tranche of DBFO reforms has received strong support from superannuation funds and insurers, with a new class of advisers aimed to support Australians with their retirement planning.
