Many in retirement are travelling comfortably, with three key factors contributing to their happiness – good physical and mental health and enough money to enjoy life.
Perhaps the assumption that markets are still anchored by predictable economic policies needs to be challenged. For the first time since the fall of the Berlin Wall, political volatility – once background noise – is potentially reshaping investment risk at a structural level.
A timely opportunity to reflect on a tumultuous 2024
Reflecting on The Golden Times’ inaugural year, what’s been most revealing is the range of issues, whether they be investment, superannuation, government policies, human interest, health or recreational, that are germane to the retiree community.
With this cohort now enjoying long and healthy retirements, they are obviously drawn to any issue that could potentially impact on their retirement income strategy.
So, the growing interest in private credit, and the potential risks this could entail for investors, was addressed in Tough choice for self-funded retirees – terms deposits or private credit. What was giving private credit greater appeal was the fact that a slowing economy prompted some S&P/ASX 200 companies to keep a lion’s share of their earnings by tightening shareholder distributions, an issue addressed in Slashed dividend payments a body blow for self-funded retirees.
Superannuation is never far from a retiree’s mind. So, the article, Don’t have half a million in super? There’s no need to panic, attracted strong interest, as did the piece on the travails of the industry (not-for-profit) funds as they struggle to handle the growing number of members in the decumulation phase. It’s an issue that’s not going away and is one The Golden Times will be revisiting in 2025, so expect more stories like Why baby boomers are opting to retire their industry fund.
The Productivity Commission’s estimate that Australia is in the early stages of a $3.5 trillion wealth transfer prompted a fresh look at the Bank of Mom and Dad and how to avoid the legal pitfalls that can occur when this form of lending or gifting turns sour.
On the political front, Australia witnessed a rare event – a bipartisan approach to the important social issue of aged care. Parliament passed the Aged Care Act to put residential and home care on a more sustainable basis with individuals’ contributions more closely attuned to their financial position, as we analysed in Self-funded retirees will have to dig deeper to pay for their aged care.
Overseas, Donald Trump was comfortably retuned to the White House for a second term. What this might mean for those in retirement was canvassed in What Trump’s second coming means for self-funded retirees.
Thanks for your support in 2024 and we look forward to bringing you all the issues that impact on retirees in 2025.
1 – Why baby boomers are opting to retire their industry fund
APRA-regulated funds, especially profit-for-member funds, have had a good innings during the accumulation phase. It’s proving a different story in the decumulation phase with a growing number of members demanding a far more nuanced service.
2 – Dreaming of retiring early? The F.I.R.E. plan is about to get even tougher
The “financial independence, retire early” approach, which trades spartan frugality now for an early retirement later, can work in the right conditions, but its benefits may be eclipsed by the sacrifice required along the way, writes Alteris Financial Group’s Jaxon King.
3 – Avoiding the pitfalls of Bank of Mum and Dad financing
Parents are increasingly digging deep to get their children and grandchildren into the property market. So, it’s imperative that any financial support is documented, and all parties fully understand what’s involved.
4 – Don’t have half a million in super? There’s no need to panic
Fresh research explains how a lifetime income product, combined with an allocated pension, could mean those on the cusp of retiring will require much smaller superannuation balances than ASFA’s recommended targets.
5 – Retirees love a guaranteed income: So why do they shun annuities?
Many people have a life-time income in retirement on their bucket list. Yet few do so, a state of affairs that might be changing as the 2022 Retirement Income Covenant requires super funds to pay closer attention to members either approaching or in retirement.
6 – Self-funded retirees will have to dig deeper to pay for their aged care
The Aged Care Act, achieved with rare political cooperation, will put residential and home care on a more sustainable basis with individuals’ contributions more closely attuned to their financial position.
7 – What Trump’s second coming means for self-funded retirees
History suggests that economics, not politics, has the biggest influence on markets. But that thesis could be tested when the 78-year-old Republican returns to the White House with a suite of proposals that will have implications for geopolitics, globalisation and financial markets.
8 – Tough choice for self-funded retirees – term deposits or private credit
With many economists expecting the Reserve Bank to start cutting interest rates in early 2025, returns on term deposits could feel the pinch. Private credit is an alternative, but those pursuing this investment option will need to do their homework – thoroughly.
9 – Slashed dividend payments a body blow for self-funded retirees
A slowing economy has prompted S&P/ASX 200 companies to keep a lion’s share of their earnings by tightening shareholder distributions, with fund manager Martin Currie identifying the resources sector as a real cause for concern regarding future income.
10 – Transferring a UK pension to Australia is no walk in the park
For those moving permanently to Australia from the UK, specialist advice is required to bring their pension with them in the most tax-effective way.
