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Successful Aussies mustn’t become complacent
The most important lessons from the global financial crisis (GFC) for both Australian and global fund managers are the importance of transparency and maintaining a low cost base, according to a leading US fund manager.
Vanguard USA's chairman and chief executive, Bill McNabb, told delegates at the Association of Superannuation Funds of Australia (ASFA) conference in Adelaide that Australia's superannuation system was the envy of much of the world, and is "light years" ahead of the US in terms of advice within super.
But that was no reason to be complacent, and there will be big shifts in the areas of investment cost, advice and the definition of "retirement" in the near future, McNabb said.
He placed much of the credit for Vanguard's success around its low cost appeal, and with costs likely to shift dramatically due to the implementation of reforms such as SuperStream and MySuper, it is a topic the local industry needs to be highly aware of.
Changing views of retirement age is likely to be a global theme, as longevity continues to increase and more people work beyond traditional retirement benchmarks of around 65.
There will also be demographic and sociological reasons for changing views around retirement age, he said. These trends will place more emphasis on income strategies for retirees, as investors look to generate stable long-term income rather than build capital.
AUTHOR
Mike Taylor
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