Innovative retirement income products – diversified income with capital stability
A perfect storm - An ageing population in a low interest rate, highly indebted world
As the post-war baby boomers continue their march towards retirement more than four million Australians have reached the 50-65 age group. Interest rates are at historical lows and, given a highly indebted world, likely to remain low for an extended period.
The current global economic environment has produced a painful dilemma for retirement planning - invest in cash and term deposits and you receive insufficient income; invest in blue chip high yielding shares and you are subject to market fluctuations in the value of your nest egg. Many in the so called ‘Mum’s and Dad’s index’ such as the Australian banks, BHP and Telstra have seen share price falls of around 30% since April 2015.
There can be severe financial and emotional consequences from failure to protect retirees’ nest eggs – unlike those in the workforce who can dollar cost average over the long run to acquire more shares.
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