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In this year’s Mercer CFA Institute Global Pension Index (GPI), New Zealand’s superannuation framework scored a B, ranking below Australia and the UK, but above the US. The GPI is an annual survey that evaluates the adequacy, sustainability, and integrity of pension systems in 48 countries. It aims to provide insights and recommendations to ensure individuals receive the best financial support during retirement.
One of the 2024 report’s key findings is that pension systems globally, need to adapt to higher life expectancies, falling fertility rates, increasing individualism, and changing expectations from better-informed members.
The report delivers six key recommendations to governments, policymakers, and the superannuation industry to improve retirement outcomes for all.
So how did Lifetime Income Retirement compare? Well according to Vanessa Glennie from the Lifetime Retirement Income team, they lead by example. Read her article here: Six tips for world-class retirement outcomes (Lifetime ticks every box).
Or you can read the article in full below.
The Global Pension Index’s six key principles for better retirement outcomes
1. The provision of regular income during retirement
The GPI report notes that the purpose of workplace and private pension schemes (like KiwiSaver) is to work alongside government support to enable people to maintain their previous lifestyle and retire with dignity. It stresses that the focus of private pension plans should not be primarily about wealth accumulation and the release of lump sums at retirement, but to spread someone’s earned income from their working years over the rest of their non-working life.
In other words, retirement savings should deliver a steady and reliable source of income that allows retirees to live comfortably and securely for the rest of their lives.
How we do it
This is Lifetime Retirement Income’s mission in a nutshell. From our flagship Lifetime Retirement Income Fund (Lifetime Income) to our innovative home equity solution (Lifetime Home), our product suite is designed to deliver a consistent and dependable income stream to our members that lasts as long as they do, giving them the financial peace of mind to make the most of their golden years.
2. Retirees need some long-term protection
The GPI highlights the many risks to retirees’ long-term financial security. Retirement is full of uncertainties, not least how long it will last, the impact of inflation on spending power, and the ups and down of financial markets. The GPI stresses the importance of retirement income solutions offering protection against these risks.
Kiwis are fortunate to have the state-funded universal NZ Super, which is adjusted annually to reflect changes in average wages. However, there is no obligation on providers of private retirement savings products (KiwiSaver being the most well-known) to help people navigate the complexities and risks of managing their money once retired.
How we do it
This is precisely what the Lifetime Income was born to do. From reviewing your mortality risk every year to ensure your savings will last the distance, to offering the option to inflation-adjust income payments, to protecting your investment from extreme market volatility, we are constantly thinking ahead…so you can focus on enjoying the present.
3. Recognising cognitive decline
As we age, it becomes harder to make complex financial decisions. The GPI report highlights that while many of us can handle our retirement plans and investments in our younger years, it's unrealistic to expect the same in our 80s and 90s. By putting sustainable, long-term plans in place with the help of experts, retirees won't have to worry about making tough financial choices as they age.
How we do it
Our purpose with Lifetime Income is to provide a sustainable, long-term retirement plan, ensuring you can enjoy your later years free from financial stress. Designed to be a lasting solution with annual check-ins, it simplifies your retirement income, making it easier to manage over time even if your cognitive abilities decline. It offers added peace of mind for couples, too – joint accounts ensure ongoing income support for the partner with the longest life expectancy.
4. Flexible benefits
The GPI report notes that there should always be some flexibility in retirement benefits because everyone’s circumstances are different. While regular retirement income remains the gold standard, retirees may also need access to some capital or a financial cushion. By offering a wide range of retirement products, the report says providers can foster innovation and help retirees find options that best suit their unique situation and goals.
How we do it
Providing our customers with choice and flexibility is core to Lifetime’s mission. Our range of income and investment products – including Lifetime Invest, our new suite of managed funds - allow retirees to tailor their retirement plans to align with their personal goals and risk appetite.
Meanwhile, Lifetime Income has several parameters that can be personalised, including projected lifespan, stepped income payments, and an inflation adjustment option. Lifetime Invest and Lifetime Income members can access their funds whenever they like – we know life can change in an instant, so there are no penalties for needing your money early.
5. The Critical Role of Pension Plans
The report emphasises the crucial role pension providers should play in supporting people in retirement. According to the GPI, key considerations for providers include how much product choice they’ll offer members, how these products will meet different needs and risk preferences, how providers will communicate with and support members throughout their retirement journey and how they’ll ensure they’re consistently offering retirees the best outcomes over time. The provision of financial services in retirement should not be “set and forget”.
How we do it
While Kiwis are well served by providers of products that help us save for retirement (i.e. KiwiSaver), Lifetime Retirement Income is one of the few, if not the only, organisation that specialises in retirement income-focused products and services.
With a drawdown fund (Lifetime Income), home equity release scheme (Lifetime Home), and a suite of standard funds offering cash, conservative, balanced and growth options (Lifetime Invest), Lifetime is a one-stop shop for holistic retirement plans that can be tailored to suit individual circumstances and risk appetites.
6. Retirees need help, guidance and advice.
Most people who retire with some money saved will have to decide how they want to manage that capital to see them through their post-work years. And, as the GPI report notes, the choices made at retirement will be crucial in determining an individual’s future lifestyle.
Yet making such significant decisions is well outside most people’s comfort zone. In short, many retirees need some help. The report states that in an ideal world, accessible and affordable financial advice should be available to all retirees. Unfortunately, most retirement income systems have not yet reached this point of maturity.
How we do it
Lifetime understands first-hand how complex it is to manage your assets over the 20-30 years most of us will spend in retirement. Not only does Lifetime provide innovative investment and income solutions that offer retirees flexibility, stability and peace of mind, we also empower our clients with the knowledge and support they need to navigate their retirement journey confidently.
Our industry-leading newsletters, educational resources, popular in-person workshops and people-centric approach to customer service (your call is always answered by one of our local team), we are committed to guiding you every step of the way.
If you’d like to learn more about how Lifetime Retirement Income can offer a safe pair of hands for your ‘third act’, request an info pack here.
Keen for a prosperous and worry-free retirement?
They know that people spending in retirement require significantly different strategies to those who are saving for retirement. They manage retirees money a little differently to people who are saving for retirement. The reason for that is they have to make sure retirees savings last.
Click on the button below to ask a question or contact the Lifetime Retirement Income Team.
Lifetime Income
Turn your retirement savings into a regular income
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