Why certainty is so important in retirement

Black box, innards not government guaranteed?

How is Allianz Retire+ superior to government guaranteed Term deposits?

Its generally not as Life Insurance companies are for profit and clip the ticket first. They're guaranteed returns to shareholders. Run the IRR on any lifetime and it rarely comes out better than TD. The benefit is only accrued by those that are lucky enough to live past ~93 years of age. Yes there are potential Age Pension benefits, but this is just tax scheming subject to change and not a standalone or direct benefit.

The old style defined benefit plans offered members income security in retirement with no concerns about market volatility. Whilst they still existence in one form or another for the lucky few, primarily long-serving public servants, a generation of retirees would have gained much enjoyment and satisfaction in retirement phase from the availability of defined benefit plans. Alas, for most Australians, the less desirable defined contribution plan is what we are left to navigate; a plan that has meant that the investment process has been democratised into the hands of the unwary member who is left to carry all the risks associated with that process and in pension phase, is required to drawdown his/her accumulated savings which are susceptible to market gyrations. How antiquated is that system?

Hardly the sort of system that a retiree wants to navigate in their less productive years.

The defined benefit funds were too good. So good that they likely would have failed in the future.

I always found the "system" was simple and obvious.No young people to pay for the old people,that seemed reasonable all those years ago.

CBA floated,OK,,if I compound $10K @ 12% for 40 years that will be a good sum of money.The 1990s were a great time for bank shares,bought all of them.They provide a 6 figure net income now in dividends.The first big crash teaches you a great lesson,50% can disappear in 12 months,the dividends were pretty much constant.The GFC is a long time ago now.Taught me a wonderful lesson,my fanatical don't over leverage worked.A few scary days but it worked.

CBA is @ $130 now.I can't break that habit of planning ahead,that goes down to $100 I'm buying. I'm not buying though,my days of white line fever and get out there on the pitch are over. 10,000 shares of CBA are worth $1.3 million today, if they go down they'll be worth $1 million,who cares,where is the problem. That will continue forever.I expect the dividend to increase,it may fall slightly,who cares. 50% of income could disappear and it is still more than we can spend.

A lifetime of people telling me you can't do that.The days of buy and hold are over.They always have at least 100 hypotheticals. Leave it alone to compound,pay the loan off as fast as you can,don't worry about how much tax you pay,don't worry about,"they might take $5 of pension off me".

If people can think of something that is easier than that I wish they would tell me.They seem to spend an entire lifetime saying that compounding does not exist.What about concentration risk.What about $ cost averaging into a well diversified portfolio.

For me,what about reality,if they lose 50% sell the lot,walk away with with say $2 million.That will last for the 10 or 15 years ( or less) of life left.

Listen to people ringing up radio stations and saying my parents have died.They have left me a house worth $1 million I'm terrified.I'm 70 years old and they will take some of my pension off me.

Good on you Kevin, I'm with you!

This how the uk pensions works

The fears outlined - "....running out of money, unexpected costs, being unable to maintain a reasonable standard of living...."

With respect to Allianz, the proposed solution is about a "guaranteed" income stream - a "replacement salary" if you like, that will hit the Bank once a month or so. To provide that income stream, Allianz and others, will have to back their "future liability" with " conservative assets" and loaded with Bonds. If markets turn against them they will need to top up Capital

For some retirees, such products may appear " worry free" and that is ok but it pays to "look under the hood" at the underlying rate of return which, almost certainly, will be significantly under long term Super returns

I congratulate Allianz on creating and supporting this innovative product but the most effective way to promote it is to have real customers who have been using it for at least 5 years endorse it. The theory is one thing, the “is it delivering what I needed/wanted” is another.

The ongoing product developments for retirement income are really welcome. However, decisions about their personal application (and other investment decisions) really hinge on each person and their partner having longevity plans to frame their future along with their chosen immediate and longer term actions to make the best of their longevity. As their longevity evolves, they are well placed to re-optimise their investment decisions and adapt to changing health and estate planning considerations. Personal longevity planning enables ongoing and properly informed commitment on all fronts.