Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 404

It’s time to do things differently in retirement policy

Amara Haqqani worked with Jeremy Cooper at Challenger for three years before becoming a consultant and policy specialist for Milliman, a leading actuarial firm. She has seen how the retirement income sector works at a policy and theoretical angle, as well as focussing on product creation and distribution. She has moved on from retirement income policy to become Chief Client Strategy Officer with Bennelong Funds Management.


In the course of a casual conversation with my husband recently, I had to explain to him what mortality credits were. He giggled like a pre-teenager. Suddenly ashamed at its absurdity in everyday language and the culture behind it all, so did I.

I’ve spent an amazing six years in retirement income helping super funds and policymakers with their positioning, strategy and product in all things decumulation. In that small amount of time there have been several policy interventions and most recently, the Retirement Income Review.

While my six years is nothing compared with the time spent on this area of finance by others of my industry peers and elders, it's still been a great snapshot in time of the types of conversations we have, the types of decisions that get made by various players in the ecosystem and, in the end, the sorts of things we need to wake up to.

People first, product second

A colleague told me at the beginning of my retirement journey that this is an industry where we like to make products that we want to sell, not that people want to buy.

His throwaway line has proven true, and the evidence of it is everywhere. We remain one of the few industries left on the planet that isn’t client centric, most likely because we haven’t had to be. We’ve had compulsion and information asymmetry and general all-round apathy working in our favour. The groundswell against this movement is already everywhere you look - from the surge in ETFs to the recent GameStop trading event.

The issue is much more acute in retirement strategy. The answer to retirement working in Australia is not the creation of more product ‘innovation’. It is not making them mandatory in regulation, it’s not forcing funds to create products today that will become tomorrow’s legacy product. It is not attacking account-based pensions when they’ve done nothing wrong in isolation.

The superannuation industry and its policymakers need to turn product thinking on its head. Retirement will only succeed in this country when we genuinely put the retirees ahead of the products we’re trying to build for them. Retirees need very basic help that we neglect to provide - help on budgeting, on the age pension, on building their retirement context. Products come after we help them and give them comfort and guidance. Products only help answer aspects of retirement problems, they don’t replace them entirely.

There are some fundamental things that need to change before mandated retirement products will work. Trustees may be required to have a product on the shelf for members, however the take-up may be low at best, or members will mutiny at worst, until some key issues are fixed.

Siloed thinking leads to siloed answers

Retirement isn’t a product problem, it’s also not just an advice problem, nor is it just an investment problem and it’s definitely not just an engagement problem either. In my experience it’s all of them at the same time.

We have a long way to go to overcome this issue. Retirement cannot be solved in silos.

Funds particularly need to bridge internal function lines in order to deliver retiree-centric solutions that work and are taken up over the long term. Until retirement is treated as seamlessly across a super fund as accumulation is, we cannot say that retirement is done well for the members.

Innovation comes at the expense of simplicity

It’s clear we live in an era where the member-investor craves transparency and simplicity. They don’t value things they don’t understand, and there is the meta-trend of the reduction in value placed on experts.

Products that present as ‘black boxes’ are now largely mistrusted, and the ‘smartest people in the room’ affliction we have in the finance industry as economists, actuaries and investment professionals, must give way to understanding that no one out there cares how smart you are if you can’t help them in a clear and efficient way.

The problem with most retirement product innovation is that it's hard to do while still being simple or transparent. Any further pushes for the industry to innovate will drive corresponding legacy product proliferation as products become harder to sell, regardless of how perfect they are on paper.

We really shouldn’t find hard-to-explain products like annuities all that much of a ‘puzzle’ in this day and age. Spoiler alert: much like we’ve discovered that markets aren’t actually all that efficient, just because a product is intellectually perfect for someone, doesn’t mean they actually understand it enough to want it.

Talking about longevity risk means getting comfortable with death

This is not the place to discuss death, or taxes, or death taxes, however until we are comfortable as a society talking about death, we will never understand how to communicate longevity risk, its insurance, or mortality credits.

The actuaries and policy makers of this industry need to find a way to never say these things in public beyond their own modelling. Until society finds a way to talk about death more openly, we will subsequently recoil at longevity risk conversations. Our best-case scenario for engagement on these topics is people devolving to giggles like my husband did.

Capital consumption is a paradigm shift

And finally, the Australian public is not interested in consuming their hard-earned capital. After all, they’ve had generations before them demonstrate that they can preserve their capital and live off the income.

If policy makers want a shift in behaviour in line with changing economic conditions, there needs to be a mass-scale level of education done and awareness raised on this topic, else all policies and products that attempt to tackle it will be rejected.

None of these themes are new of course, and others have raised them before me.

In stepping away from the super and retirement income world in favour of working on some other exciting things, I’m hoping that the industry uses the Review, and the upcoming Covenant, to try to do things a little differently. Let’s not build retirement products because we have to. Let’s put the member at the centre of our systems, our thinking, our regulation and our offerings. Put product last. If we do, this time it could actually stick.


Amara Haqqani is Chief Client Strategy Officer at Bennelong Funds Management. This article was first published in Investment Magazine and is reproduced with permission.


April 29, 2021

The simple client centric solution 'was' to be 'trustworthy and transparent' enough to have customers feel comfortable in growth then balanced super with a gradual move to conservative as they get close to retirement (unless they can clearly tolerate staying in balanced).
Accompanying this was the mantra of maximising super during working life and taking close to the minimum in retirement to make it last. This is what one of the biggest super funds in Qld had in place and served it's members very well. (sequencing of risk strategies only suit clients who intend to withdraw massive lump sums on a particular date, or fearful clients who've never developed trust in their managers so they sellout when the news is bad; ie, it only suits the lowest common denominator clients; and churning).
Then sequencing of risk, etc, came along, allowing managers to churn people out of appropriate long term investments for their 'very long term' 25 year investment/retirement timeframe, and put them into super low risk, super low return, short term investments, that don't suit their very long term retirement timeframes.
Putting clients into very low returns necessitates most of them using capital to co-fund their retirement.
(sequencing of risk strategies only suit clients who intend to withdraw massive lump sums on a particular date, or fearful clients who've never developed trust in their managers so they sellout when the news is bad; ie, it only suits the lowest common denominator clients; and churning).

April 23, 2021

Whilst I agree I'm not sure this has any practical application. What profession doesn't push product/service irrespective of the clients immediate needs? Simplicity is not an option as the regulations backing super will never allow it to be so. A non-silo approach is easier said than done and is extremely unlikely to prevail given the vested interests. Our current system is ranked as one of the best in the world already. If this changes then I see a much stronger case for mandated change.

Peter Vann
April 23, 2021

Thanks for your insightful perspectives regarding the retirement space. It is a clarion call to the industry to move forward by focusing on member outcomes, as you say “People first, product second”.

A few years ago a business colleague and I did a number of talks “5 retirement myths” which is summarised in a Firstlinks article here ( We concluded that the industry should focus on the sustainable pay cheque in retirement. I still believe that this puts discussions about finances in retirement in a language members can understand, ie simplicity and relevance at the member level.

April 22, 2021

Amara is a girl's name of Latin origin with the meaning of "everlasting". So.....Having you talking about mortality credits while you are everlasting is ironic. ["Mortality credits are created when people die sooner than expected and don't receive as many income payments as they would have if they had lived their full life expectancy. etc"]. Another observation: I think you would be unique in your appreciation of the intricacies involved yet you are leaving the field? You say "Retirement isn’t a product problem, it’s also not just an advice problem, nor is it just an investment problem and it’s definitely not just an engagement problem either. In my experience it’s all of them at the same time." "It’s time to do things differently in retirement policy" "And finally, the Australian public is not interested in consuming their hard-earned capital. After all, they’ve had generations before them demonstrate that they can preserve their capital and live off the income." "Let’s put the member at the centre of our systems, our thinking, our regulation and our offerings. Put product last. ............If we do, this time it could actually stick." Yes! That is exactly what "all us retirees and SMSF managers" want. Something stuck in place, permanent, certain, immutable. Something "we" could rely on and work with, a fixed constant. We are fed up with the continual change and threats of change and reinterpretation of rules and regulations, the apprehensive feeling that "we" may have overlooked something that will result in a penalty or worse! Why can't we be left alone with one permanent to "see us out". "Grandfathering" perhaps for "protection" !!! Grandfathering provisions enable a person to continue to have their circumstances assessed under the 'old rules', so they are not disadvantaged by the introduction of the 'new rules'. ... Income support recipients to whom the grandfathering provisions apply may come to light on an ongoing basis. WHY NOT ?? That seems to me to be fair , just and equitable !

Marc Lyell
April 22, 2021

Thank you for this article. I don’t think the industry is listening to these ideas yet. Their interpretation of member centric service does not match the suggested approaches described by the author.
This is hopefully an opportunity for innovation and real competition by the industry to introduce services which educate, support and meet the needs of members/ consumers in the pension phase of superannuation.

John Woolfield
April 22, 2021

I did not understand the term "mortality credits", but understood the concept. For those that do not: "The mortality credit is also known as the mortality yield. With a participating annuity, premiums paid by those who die earlier than expected contribute to gains of the overall pool and provide a higher yield or credit to survivors than could be achieved through individual investments outside of the pool. The mortality credit increases significantly with age and hedges longevity risk, often creating a return that would be impossible to match in the broader financial markets." I agree with much of this comment, but to take it down to a lower level, what you are asking for is for the finance and superannuation industries to behave in an ethical manner. And for the policy makers, read politicians, to behave in the best interests of the general populace. Certainly recent history has shown that this is not generally the case, but I am hopeful.


Leave a Comment:



Retirement income promise relies on spending capital

How retirees might find a retirement solution in future

Retirement Review gives strong views on hoarding of super


Most viewed in recent weeks

Is it better to rent or own a home under the age pension?

With 62% of Australians aged 65 and over relying at least partially on the age pension, are they better off owning their home or renting? There is an extra pension asset allowance for those not owning a home.

Too many retirees miss out on this valuable super fund benefit

With 700 Australians retiring every day, retirement income solutions are more important than ever. Why do millions of retirees eligible for a more tax-efficient pension account hold money in accumulation?

Is the fossil fuel narrative simply too convenient?

A fund manager argues it is immoral to deny poor countries access to relatively cheap energy from fossil fuels. Wealthy countries must recognise the transition is a multi-decade challenge and continue to invest.

Reece Birtles on selecting stocks for income in retirement

Equity investing comes with volatility that makes many retirees uncomfortable. A focus on income which is less volatile than share prices, and quality companies delivering robust earnings, offers more reassurance.

Comparing generations and the nine dimensions of our well-being

Using the nine dimensions of well-being used by the OECD, and dividing Australians into Baby Boomers, Generation Xers or Millennials, it is surprisingly easy to identify the winners and losers for most dimensions.

Anton in 2006 v 2022, it's deja vu (all over again)

What was bothering markets in 2006? Try the end of cheap money, bond yields rising, high energy prices and record high commodity prices feeding inflation. Who says these are 'unprecedented' times? It's 2006 v 2022.

Latest Updates


Superannuation: a 30+ year journey but now stop fiddling

Few people have been closer to superannuation policy over the years than Noel Whittaker, especially when he established his eponymous financial planning business. He takes us on a quick guided tour.

Survey: share your retirement experiences

All Baby Boomers are now over 55 and many are either in retirement or thinking about a transition from work. But what is retirement like? Is it the golden years or a drag? Do you have tips for making the most of it?


Time for value as ‘promise generators’ fail to deliver

A $28 billion global manager still sees far more potential in value than growth stocks, believes energy stocks are undervalued including an Australian company, and describes the need for resilience in investing.


Paul Keating's long-term plans for super and imputation

Paul Keating not only designed compulsory superannuation but in the 30 years since its introduction, he has maintained the rage. Here are highlights of three articles on SG's origins and two more recent interviews.

Fixed interest

On interest rates and credit, do you feel the need for speed?

Central bank support for credit and equity markets is reversing, which has led to wider spreads and higher rates. But what does that mean and is it time to jump at higher rates or do they have some way to go?

Investment strategies

Death notices for the 60/40 portfolio are premature

Pundits have once again declared the death of the 60% stock/40% bond portfolio amid sharp declines in both stock and bond prices. Based on history, balanced portfolios are apt to prove the naysayers wrong, again.

Exchange traded products

ETFs and the eight biggest worries in index investing

Both passive investing and ETFs have withstood criticism as their popularity has grown. They have been blamed for causing bubbles, distorting the market, and concentrating share ownership. Are any of these criticisms valid?



© 2022 Morningstar, Inc. All rights reserved.

The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. Any general advice or ‘regulated financial advice’ under New Zealand law has been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. For more information refer to our Financial Services Guide (AU) and Financial Advice Provider Disclosure Statement (NZ). You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.

Website Development by Master Publisher.