Advisers expect influx of retiree clients


By Julie May

Email Article Print Article

Financial planners expected their future client bases to represent a larger cohort of retirees, but fewer in the accumulation phase, research from Investment Trends revealed yesterday.

The “December 2014 Retirement Planner Report”, which looked at the attitudes and preferences of investors aged 40 and over, was based on a survey of 617 advisers.

The study showed 32 per cent of planners expected a greater percentage of their client base would be 75 and over by 2017, while 35 per cent expected clients in the accumulation phase would represent a smaller proportion of their client base over two years.

“Planner expectations reflect Australia’s ageing baby boomer generation,” Investment Trends senior analyst Recep Peker said.

“Over the next 25 years the number of Australians aged 65 and over is expected to double and planners are actively shifting their focus to align with this.”

The government’s recent “Intergenerational Report” confirmed Australia’s increasing longevity, with today’s 60 year-old male likely to live to 86.4, and today’s 60 year-old female likely to live to 89.1.

Meanwhile, Peker said the study showed planners identified high income and low risk as the top priorities for retiree clients.

When given a trade-off between five separate investment objectives, 68 per cent of planners identified “highest income” as the first or second most important priority for meeting the best interests of retiree clients, while 65 per cent identified “lowest risk” as the first or second most important priority.

Meanwhile, high liquidity, lowest cost and highest capital growth lagged behind in terms of importance for this demographic, according to Investment Trends.

“Highest capital growth and lowest cost are the least important priorities for planners with retiree clients,” the group said.

In an earlier report by Investment Trends, released in February, the group revealed 44 per cent of retirees expected they would outlive their retirement savings, which was up from 33 per cent a year ago.

Further, 51 per cent of pre-retirees and accumulators also expected to outlive their retirement savings, with only 10 per cent of Australians indicating they had a plan to address longevity.

« Back to Articles