Most Australians have felt the pressure of rising costs.

Australians aged 60 and over remain positive about retirement, but rising cost of living continues to impact lifestyle, financial security, and confidence their money will last, according to the third annual Challenger Retirement Happiness Index.

Challenger, in partnership with independent research provider, YouGov, surveyed more than 2,000 Australians aged 60 and over and found overall happiness among older Australians remains strong, with this year’s Challenger Retirement Happiness Index score rising to 69.5 (up from 68.9 in 2025).

Volunteers were found to be the happiest older Australians, with an average happiness score of 77 compared with 69 for those who do not. Married couples (72 vs 66 for unmarried) and homeowners (73 vs 60 for non-homeowners) also beat the benchmark.

More broadly, the Index showed activities and hobbies (80), a clear sense of purpose (72), and physical and mental health (68), remain the biggest drivers of retirement happiness.

Having enough money to enjoy retirement was a top priority for more than two-fifths (44%) of Australians aged 60+, ranking just behind physical health (58%) as the most important factor to a happy retirement.

The research found that retirees key savings goals were certainty their money will last for life (72%), confidence to cover health and aged care costs (65%), and maintaining their lifestyle (53%).

Commenting on the findings, Challenger Chief Executive, Customer, Mandy Mannix, said the research shows life can get even better in retirement but confidence and certainty were key.

“One of the strongest insights is the powerful role purpose plays in retirement happiness. People who volunteer, stay active in their communities, and maintain hobbies and interests consistently report higher levels of happiness,” said Ms Mannix.

“It goes to show that retirement really can be the prime time of life. The key is to have the confidence
and certainty to relax in those golden years, knowing your money will last and you can afford to enjoy all
retirement has to offer,” she said.

Cost of living continues to bite

For the third straight year, cost of living continues to be a concern for older Australians who are worried about the impact of rising costs on lifestyle (57%), financial security (54%), and running out of money in retirement (46%).

Two in three (67%) Australians aged 60 and over believe inflation and cost of living are the most important thing to plan for in later years of retirement, with the challenge particularly acute for women who often retire with less super.

Women (48%) are more likely than men (43%) to rank fear of running out of money in retirement as one of the top three things impacted by the rising cost of living. Similarly, pre-retirees (49%) are more likely than retirees (39%) to rank this as one of their top three concerns.

“Today’s retirees are the first generation having built significant superannuation savings. Yet, after decades of focusing on saving, many retirees find it surprisingly difficult to switch to spending once they retire,” said Ms Mannix.

On average, Australians aged 60 and over believe the minimum amount of annual income (per person) needed for a person aged 65 or more to live comfortably and happily in retirement is $70,398 or approximately $1,350 per week. This is higher than the ASFA Retirement Standard that recommends $54,840 a year ($1,055 per week) for a comfortable lifestyle for a single.

“Most Australians have felt the pressure of rising costs. Whether it’s paying for essentials like petrol, going out for lunch, or taking a holiday. These higher prices can be felt even more by retirees who now face the reality of living on a set amount of money for the rest of their lives,” she said.

“The dollar value of a lump sum when you retire can seem like a lot of money, but it has to last a long time. It can be hard to know how much to withdraw, knowing that the purchasing power of $1 million today can halve in 20 years’ time. The impact of inflation can be dramatic, and it is a real concern.

“That’s the power of a guaranteed regular income. A ‘paycheck’ means retirees know their needs are taken care of giving them greater confidence to spend on their activities and hobbies that give them purpose and happiness in retirement,” added Ms Mannix.
Guidance needed to improve retirement outcomes

Nearly four in five Australians aged 60+ (76%) said they would be much happier if they had a guaranteed income for life in retirement. Yet, more than half of all Australians 60+ (59%) did not know about, or hadn’t heard of, lifetime income streams as a financial strategy for retirement.

A clear knowledge gap persists, despite 1 in 3 Australians (30%) saying they would be happier in retirement with greater financial education. Free education provided by a super fund or bank (52%), government agency (50%), or paid education provided by a professional financial adviser (39%) were the top three preferred approaches to building financial knowledge and boosting retirement happiness.

“After decades of savings, we are asking retirees to do something that feels completely counter-intuitive – to start spending. That change requires financial guidance and support,” Ms Mannix said.

“Older Australians want a guaranteed regular income in retirement to help manage day-to-day expenses that can provide financial security for life, but access and awareness remain key barriers.”

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Mandy Mannix

Australians are living a happy retirement, but for those approaching retirement the picture is less certain. New data from the Challenger Retirement Happiness Index, released yesterday, shows preretirees are feeling more anxious about their financial future, with confidence taking a hit over the past year.

The second annual Challenger Retirement Happiness Index, developed in partnership with independent research provider, YouGov, surveyed 1633 Australians aged over 60 to track factors driving retirement happiness. While overall happiness remains strong, pre-retirees are feeling the squeeze, with rising living costs and a lack of financial certainty clouding their outlook.

Those in retirement reported higher scores of happiness (70) compared to pre-retirees (66), but cost-ofliving pressures are impacting confidence across the board. Three in four pre-retirees (76%) and 72% of all Australians 60+ saying rising cost of living has affected their financial security, with a third (34%) noting a significant impact.

While the overarching Index score edged down slightly to 69 (down from 70 in 2024) the key drivers of retirement happiness remained unchanged including activities (80), mental health and wellbeing (75), and a sense of purpose (72).

Commenting on this year’s findings, Challenger Chief Executive, Customer, Mandy Mannix, said: “Ask a happy retiree what brings them joy, and they won’t just talk about their super balance. They’ll talk about the coffee catchups, the morning walks, and the holidays they have planned to visit family or see the world. The little things make a big difference – which is why activities and purpose are so important.”

“When we asked Australians over 60 what made them happy, three things stood out: good physical health (59%), enough money to enjoy life (41%), and good mental health (38%),” Ms Mannix added.

Concerns shake confidence

Women and unadvised Australians are facing the highest barriers to a confident retirement. A third of women over 60 (34%) are extremely or very worried about outliving their savings compared to 20% of men. Unadvised Australians are twice as likely to be extremely or very worried about outliving retirement savings (35% compared to 19%).

“We know retirement can be one of the most rewarding stages of life—but confidence is key,” Ms Mannix said. “When people feel uncertain about their finances, they tend to hold back. That’s led to a chronic underspending problem in retirement, with many Australians living more cautiously than they need to.

“Retirees go from a steady pay cheque to a lump sum, and that sudden shift makes it hard to budget with confidence. That’s why a guaranteed, regular income for life is so powerful—it replaces that pay cheque, can keep up with inflation, and gives retirees the freedom to actually live their best life in retirement.”

Education key to empowering retirees

The research revealed that better guidance and simple education could be key to helping Australians feel confident enough to spend and enjoy their retirement – without the fear of running out.

Three in four (74%) Australians aged 60+ believe better financial education would improve their happiness, but half (51%) say they don’t have the resources to plan for retirement. One in five – around 1.2 million retirees – don’t know where to start.

The Challenger Retirement Happiness Index findings align with recent UNSW research, which revealed 57% of people don’t even know that lifetime income solutions exist, despite their ability to significantly improve confidence to spend in retirement.

With nine in ten unadvised (those who have never received financial advice) Australians wanting free, basic retirement education, there is a significant opportunity to improve financial literacy and help retirees feel more secure about their future. With the right education and income strategy, retirees could enjoy more freedom and financial security.

“Retirement confidence isn’t just peace of mind—it’s quality of life. When people feel financially secure, they spend, plan, and live without that worry. That’s why guaranteed regular income matters, and why Challenger is committed to helping retirees feel secure for a better future,” Ms Mannix said.

Read the report.

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Chris Grice

With inflation pushing living costs higher, covering daily expenses and planning for the future continues to be a major concern for older Australians, according to new research by National Seniors Australia and leading retirement income provider, Challenger.

The National Seniors Social Survey of 4,700 Australians aged 50 and over revealed that home ownership doesn’t guarantee financial security, with nearly 90% saying that relying solely on the Age Pension, without additional income, is insufficient for a basic lifestyle in retirement. Half of surveyed homeowners told us they would need $10,000 (singles) and $15,000 (couples) more than the Age Pension per annum to meet these needs. While the Age Pension provides a safety-net, the report highlights that older Australians need more for even a basic lifestyle.

Also an issue raised by respondents is the lack of appropriate information to help navigate retirement. Of those who hadn’t received adequate advice, 42% said they wanted to know more about aged care cost calculations followed by investment options (34%), and options to balance spending and saving (22%).

Chris Grice, Chief Executive Officer of National Seniors Australia, highlighted the growing concern among seniors that they don’t have the appropriate support to plan for retirement: “We found that calculating aged care costs was the topic most people wanted financial advice about. Older Australians feel anxious about the prospect of needing aged care and the unknown costs associated with it. We must ensure seniors are not left to navigate these challenges alone, without adequate guidance or resources.”

Aaron Minney, Head of Retirement Income at Challenger, commented: “Australians need help to best use their savings to live life to the fullest, at every stage in retirement. We’re living longer and it’s essential for retirees to plan for 30 years or more in retirement. With the right guidance, we can ensure that people are financially prepared for aged care when they need it, and can enjoy an active retirement, knowing they are ready.”

Paying for aged care has become a dominant concern for older Australians in 2024 with 60% of survey participants worried about how they cover these expenses while in 2021 Challenger and National Seniors research found that only 38% of people had thought about aged care costs.

Advice the golden ticket to retiring with confidence

Financial advice is associated with positive outcomes for Australians aged over 50 with 41% of respondents (who had already received financial advice) being more likely to feel financially comfortable, to be retired, and own their home outright. However, barriers for Australians in seeking financial advice remain, with cost, perceptions about the independence of advice and difficulty finding an appropriate adviser who meets their needs the main obstacles.

Close to half (46%) of those surveyed were interested in a lifetime income option for at least some of their retirement income. This compares to less than one in 10 Australians who currently have a guaranteed income stream, either directly through an annuity or as part of their (defined benefit) superannuation. One in five said they didn’t have enough savings to consider guaranteed income as an option.

“Lack of awareness and understanding about retirement income options has been a real challenge for Australians in or approaching retirement. Our customer research tells us guaranteed income provides peace of mind and significantly increases retirement happiness,” Mr Minney said. “Having a portion of your savings guaranteed to last a lifetime, brings an unparalleled sense of security. This is especially true in an environment of high and variable inflation and share market volatility, with retirees increasingly looking for ways to maintain their lifestyle and ensure they can enjoy their golden years without the risk of running out of money.”

Cost of living pressures and inflation are being unevenly felt amongst older Australians

Increasing living costs and inflation have created a divide among older Australians. Only half of those with less than $350,000 in savings feel financially comfortable compared to 84% of those with more than $350,000, highlighting a significant gap of 34%.

When respondents were asked how they would spend an extra $100 per week, one-third (33%) said they would save the extra money for later spending — such as a holiday or other big-ticket items — while another 29% stated they needed the funds for their everyday essentials.

Specifically, housing costs, including rent and mortgage payments, were a major concern for those feeling less financially secure.

“This research clearly shows that many older Australians are struggling to reconcile the cost of living with their retirement income. It’s not just about making ends meet; it’s about ensuring that retirees have the financial security to live with dignity and peace of mind,” Mr Grice added:

Read the report.

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Nick Hamilton

Challenger Limited (ASX:CGF) announces it will extend the reinsurance partnership between Challenger Life and Mitsui Sumitomo Primary Life Insurance Company Limited (MS Primary)^[1].

Since November 2016, Challenger Life has successfully partnered with MS Primary, a leading annuities provider in Japan, to reinsure Australian dollar annuities. The arrangement has subsequently expanded to include US dollar and Japanese yen denominated annuities.

Under the new agreement, Challenger Life will continue to receive a quota share of reinsurance across Australian dollar, US dollar and Japanese yen denominated annuities issued in Japan by MS Primary, commencing from 1 July 2024.

MS Primary will provide to Challenger Life an annual amount of reinsurance of at least ¥50 billion per year (currently ~A$500 million^[2]

) for the next five years, subject to review in the event of a material adverse change for either MS Primary or Challenger Life.

Challenger Life will also support MS Primary with any new reinsurance requirements that MS Primary may have.

MS Primary is a subsidiary of MS&AD Insurance Group Holdings Inc., which holds 15% of Challenger’s issued share capital, and under a long-term strategic relationship has representation on the Challenger Limited Board.

Challenger’s Chief Executive Officer and Managing Director, Nick Hamilton said: “We are delighted to extend our reinsurance partnership with MS Primary. This reflects the strong, collaborative and mutually beneficial relationship that we have developed over a number of years, and it was a privilege to celebrate the eighth year of our reinsurance partnership with a MS Primary delegation at our Sydney office this week.

“The arrangement that we’re announcing today also supports our focus on longer duration annuity business with the objective of improving the quality of Life’s annuity book growth and driving stronger returns.

“Challenger Life is an important reinsurance partner for MS Primary and we’re very pleased to continue to support its growth. We look forward to the continued success of our relationship and supporting MS Primary to provide financial security to its customers.”

MS Primary Executive Chairman, Yasuhiro Nagai said: “The extension of the reinsurance partnership demonstrates our commitment and confidence in Challenger. Challenger is a special business partner to MS Primary as a reliable reinsurer. More recently, our partnership has expanded to include asset management in Australia and Japan. We hope to continue to explore and exploit opportunities with Challenger to further mutual benefits and enhance the business partnership.”

——–

Notes:

1 Subject to execution of final legal documentation.

2 Based on 3-month average exchange rate at 20 May 2024.

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Aaron Minney

Protecting retirement income from inflation is an increasing priority for Australians in or approaching retirement with retirees uniquely exposed to a range of investment risks, the latest whitepaper from leading retirement income provider, Challenger, has revealed.

The research paper, Protecting retirement income from inflation, found inflation risk has a unique, heightened impact on a portfolio in the retirement phase, with flow on effects to sequencing and longevity risks.

Commenting on the paper, Challenger’s Head of Retirement Income Research, Aaron Minney, said an investment strategy that provides a steady rate of return is required to provide confidence in retirement.

“Cost of living spikes tend to be short term and that is manageable during the accumulation phase as there is time to recover. Retirement is different. It is about having a secure, regular income that allows you to enjoy your lifestyle,” Mr Minney said.

“While equities have historically delivered a rate of return higher than inflation more than 70% of the time, for positive returns this sometimes required a 16-year investment horizon.

“Retirees do not have this luxury, meaning they are at heightened risk to the impacts of inflation and need a hedge in their retirement portfolio that can protect the income,” he said.

The impact of inflation remaining higher for longer is being acutely felt by mature Australians. Challenger’s Retirement Happiness Index^[1] revealed 2 in 3 Australians over 60 said rising cost-of-living and affordability challenges were impacting confidence they would have enough money to retire.

Cost-of-living concerns were most notable for pre-retirees, unadvised Australians, and women, with almost 40% of these cohorts reporting cost-of-living as significantly impacting retirement happiness and their view of financial security.

Mr Minney said professional advice and increased financial education were crucial to empower safe spending and confidence.

“While the fall in inflation from multi-decade highs is good news for our economy, many retirees continue to struggle with cost-of-living because of the cumulative impact inflation has had on their financial position,” Mr Minney said.

“There is a clear need for some form of professional financial advice, yet we found only one in five Australians over 60 are currently receiving it. Education on retirement options was also found to be critical, with almost 80% of respondents saying it would boost their happiness.

“Advisers have an important role to play in enabling safe spending, empowering retirement confidence, and protecting income to last throughout their clients’ golden years. As we continue to navigate a volatile market and geopolitical landscape, retirees need a portfolio that is protected from inflation risks so that they don’t experience another cost-of-living crisis when inflation has another upturn.”

With more than 2.5 million Australians, 10% of our population, set to retire in the coming decade, retirement is a top priority for government, industry, and aging Australians.

Challenger’s inflation whitepaper reveals allocating a portion of capital to a guaranteed income stream, such as an inflation-linked lifetime annuity, can enable greater retirement confidence, prevent underspending, and minimise investment risk.

“We know more than 70% of Australians over 60 would be happier if they had a guaranteed income,” Mr Minney said.

“There is a misguided perception that equity market exposure will be sufficient to maintain your lifestyle in retirement, but data clearly shows that while this may be the case when you are working and accumulating savings, in retirement you need an investment strategy that will help you maintain your lifestyle regardless of market returns or spikes in inflation.

“Today, many retirees are underspending due to the fear they will outlive retirement savings. We, as an industry, have a responsibility to empower confidence to spend in retirement, provide assurance that income will keep pace with inflation, and protect from the highs and lows of market-linked investments,” Mr Minney said.

———

Notes:
[1] https://www.challenger.com.au/personal/happiness-index?cid=ie_br_c_Happy_1303HappinessPR_df_

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Mandy Mannix

Challenger’s inaugural Retirement Happiness Index paints a vibrant picture of Australians, in or near retirement, with physical health and financial security being the primary factors influencing contentment of those over 60.

In collaboration with independent research house, YouGov, Australia’s leading retirement income provider, Challenger, conducted the study of over 1000 Australians over 60 to delve into the intricacies of retirement happiness.

The 2024 Challenger Retirement Happiness Index revealed a score of 70 for Australians over 60 encompassing a range of factors such as mental and physical health, social connections, purpose, and financial wellbeing.

Notably, activities and hobbies scored the highest (79.5) followed by mental health (77.6). Physical health (61.5) and financial stability (56.3) were flagged as areas with the most potential for improvement in enhancing overall wellbeing.

More than 2 in 3 (66%) of Australians over 60 said they would be much happier if they didn’t have to worry about finances in retirement, while more than 70 per cent believe a guaranteed income in retirement would significantly boost happiness, with more than 40 per cent strongly agreeing.

Challenger Chief Executive, Customer, Mandy Mannix, explained the importance of understanding all the drivers of happiness in retirement.“We’ve launched the Retirement Happiness Index to explore new dimensions of retiree satisfaction. It is fantastic to see majority of Australians are enjoying or expecting a happy, healthy retirement,” Ms Mannix said.

“It is another way that Challenger looks to deliver on its purpose of providing customers with financial security for a better retirement. A better retirement is about so much more than finances but having a degree of confidence that your savings will last plays an important role.

“Almost half of respondents identify financial security as an area they wish to improve, highlighting the work we must do as an industry to safeguard retirees’ golden years and foster a better, happier retirement.

“Reassuringly retirees felt their happiness would improve with access to the right financial education, as well as support through financial advice and a regular income to enjoy a safe, stable retirement. This would empower retirees with the confidence to spend and capacity to pursue their passions,” she added.

Good physical and mental health alongside having enough money to enjoy retirement were revealed to be the most important elements to a happy retirement.

Rising cost of living impacting retirees’ happiness

Rising cost-of-living and affordability were growing concerns, with 2 in 3 Australians over 60 saying it impacted their confidence they would have enough money for retirement.

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Mandy Mannix

Challenger’s inaugural Retirement Happiness Index paints a vibrant picture of Australians, in or near retirement, with physical health and financial security being the primary factors influencing contentment of those over 60.

In collaboration with independent research house, YouGov, Australia’s leading retirement income provider, Challenger, conducted the study of over 1000 Australians over 60 to delve into the intricacies of retirement happiness.

The 2024 Challenger Retirement Happiness Index revealed a score of 70 for Australians over 60 encompassing a range of factors such as mental and physical health, social connections, purpose, and financial wellbeing.

Notably, activities and hobbies scored the highest (79.5) followed by mental health (77.6). Physical health (61.5) and financial stability (56.3) were flagged as areas with the most potential for improvement in enhancing overall wellbeing.

More than 2 in 3 (66%) of Australians over 60 said they would be much happier if they didn’t have to worry about finances in retirement, while more than 70 per cent believe a guaranteed income in retirement would significantly boost happiness, with more than 40 per cent strongly agreeing.

Challenger Chief Executive, Customer, Mandy Mannix, explained the importance of understanding all the drivers of happiness in retirement.

“We’ve launched the Retirement Happiness Index to explore new dimensions of retiree satisfaction. It is fantastic to see majority of Australians are enjoying or expecting a happy, healthy retirement,” Ms Mannix said.

“It is another way that Challenger looks to deliver on its purpose of providing customers with financial security for a better retirement. A better retirement is about so much more than finances but having a degree of confidence that your savings will last plays an important role.

“Almost half of respondents identify financial security as an area they wish to improve, highlighting the work we must do as an industry to safeguard retirees’ golden years andfoster a better, happier retirement.

“Reassuringly retirees felt their happiness would improve with access to the right financial education, as well as support through financial advice and a regular income to enjoy a safe, stable retirement. This would empower retirees with the confidence to spend and capacity to pursue their passions,” she added.

Good physical and mental health alongside having enough money to enjoy retirement were revealed to be the most important elements to a happy retirement.

Rising cost of living impacting retirees’ happiness

Rising cost-of-living and affordability were growing concerns, with 2 in 3 Australians over 60 saying it impacted their confidence they would have enough money for retirement.

Unadvised Australians (those who have never received financial advice) are more likely to report cost-of-living as having a significant impact to their financial security (39%) compared to those who have received financial advice (25%).

“We know the fear of outliving savings is a growing concern among older Australians. Providing retirees with the confidence to convert their retirement savings into a regular income can materially improve their quality of life, supporting better retirement outcomes as well as benefiting broader society and the Australian economy,” Ms Mannix said.

Read the report.

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Nick Hamilton

Commonwealth Superannuation Corporation (CSC) will amplify its commitment to guiding customers to a comfortable retirement as it partners with Challenger, Australia’s leading provider of annuities, to launch the next stage of its Retirement Income Strategy (RIS) in early 2024.

With more than 745,000 customers and $63.3 billion^[1] in Funds under Management (FUM), CSC provides super products designed specifically for current and former members of the Australian Public Service (APS) and Australian Defence Force (ADF).

Its retirement solutions have been developed for customers as part of its RIS. Leveraging qualitative and quantitative research, CSC selected Challenger to provide a longevity solution to help meet its customers’ needs in retirement — that can be blended with its existing account-based pension, Commonwealth Superannuation Corporation retirement income (CSCri).

CSC CEO, Damian Hill, believes partnering with Challenger will be a boon for customers. “We are delighted to partner with Challenger, Australia’s largest provider of annuities,” he said.

“CSC has undertaken a detailed review of the options and providers available to help our customers address longevity risk in retirement, and Challenger is our selected industry leading provider.”

As Australia’s largest defined benefit pension provider, currently providing pensions to over 250,000 Australians, and a legacy of paying pensions for over 100 years, CSC’s RIS is an exciting steppingstone into a new century of serving those who served and their beneficiaries.

The strategy aims to provide customers with innovative retirement solutions and support and guidance, regardless of the path they choose in their retirement. Customers are guided through the use of customer cohort-based retirement profiles, simplifying their journey to accessing retirement income.

“We’ve developed a number of retirement income solutions tailored to different customers’ needs, based on grouping our customers into cohort-based retirement profiles,” Mr Hill said.

“The creation of these profiles was informed and guided by our customer research and independently reviewed by an external specialist. When we launch in early 2024 we’ll also provide customers with the support and guidance required to help them choose the retirement profile and solution that’s right for them. One that suits their balance of stability and sustainability of income, retaining the purchasing power of their income, as well as continuing to be able to access their capital.”

Challenger CEO and Managing Director, Nick Hamilton, said that he felt honoured that the partnership with CSC would support Australians who have served in the APS and ADF in their retirement.

“Like many older Australians, a significant cohort of CSC customers are worried their savings will run out, leading many to ‘under retire’ and unnecessarily reduce their quality of life. Leveraging our

expertise in managing longevity risk, CSC can now offer their customers a solution that will provide guaranteed income in retirement, and the confidence to draw down their savings,” Mr Hamilton said.

“Through our partnership, Challenger’s longevity solution will form part of CSC’s broader retirement income strategy, ensuring that their customers can access a simple solution at scale.”

CSC customers who may benefit from an annuity as part of their retirement solution will be referred to a CSC representative before finalising their decision. This will help to ensure that they have the support and guidance they need to make a confident and informed retirement income solution decision.

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[1] As at 30 June 2023, CSC Annual Report 2022-23

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Mandy Mannix

Challenger has announced its fixed term annuities are now available within the Netwealth Platform, simplifying and broadening access to income solutions for advised customers.

Making fixed term annuities available within the Netwealth Platform delivers greater efficiency for advisers and their clients, removing the need to quote or complete a separate application form, and is fully integrated for Netwealth client reporting.

Annuities are available for terms of up to five years across Netwealth’s investment, super and pension platforms. This allows customers to invest both superannuation savings and non-superannuation money without leaving the platform.

Mandy Mannix, Challenger’s Chief Executive, Customer said: “Fixed term annuities are a really attractive option for anyone seeking to help maximise returns on their holdings, and of course for those simply looking for certainty of regular income,” Ms Mannix said.

“We are constantly looking to improve the efficiencies for advisors using our products and our partnership with Netwealth does just that, by providing advisers and their clients easy access to fixed term annuities with all the efficiencies that come with investing in a platform.

“Investors seeking secure income are increasingly recognising the benefits of fixed term annuities, which are currently offering the most attractive rates we have seen in a decade, often at a premium to major bank term deposits.

“Providing Challenger fixed term annuities in platform expands access to a broader range of customers, enabling advisers to integrate term annuities into portfolios to deliver better retirement outcomes for their clients.”

Matt Heine, Netwealth CEO and Managing Director, said the launch of an in platform annuity solution allows advisers easy access to fixed term annuities in the same way they would invest in any other fund or product.

“Our partnership with Challenger is another example of Netwealth leading the market in offering the most comprehensive suite of products for advisers and their clients” Mr Heine said.

“In the current environment investors are looking for ways to protect their portfolio from market volatility and address the persistent high inflation environment we are facing. This partnership provides greater access to an alternative to term deposits with attractive rates.”

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Aaron Minney

Building robust inflation defences into client portfolios is a key consideration of advisers in the current climate. That’s according to a new report by the leading digital platform for financial advice professionals, Ensombl, and retirement income specialist Challenger.

The report, Practical strategies to mitigate the impact of inflation risk on retirement incomes, showcases a range of adviser case studies, revealing how financial advisers are using a combination of client-driven lifestyle changes, asset allocation and product strategies to tackle inflation for clients who are retired or approaching retirement.

Challenger’s Head of Retirement Income Research, Aaron Minney said for Australians in – or approaching – retirement, the outlook for 2023 remains challenging.

“Inflation, which had long been forgotten, is today an insidious risk for retirees. With an annual inflation rate running at more than 7%, it erodes retirees’ spending power, tempting some to draw down additional savings. While volatile investment markets also present risks, inflation tends to amplify them considerably and is usually more enduring,” Mr Minney said.

“Inflation can have a particularly large impact early in retirement, when increasing drawdowns to cover rising costs can amplify other issues like sequencing and longevity risks.”

Ensombl CEO Clayton Daniel said it is clear there are many different ways to mitigate the impact of inflation on retirement income, which generally fall into one of three high-level categories.

“To the extent that every retiree’s circumstances are different, the specific responses and strategies being employed at an individual client level are both many and varied,” Mr Daniel said.

“However, after speaking to financial advisers around Australia, it is clear that managing inflation risks will require clients to consider reducing or deferring living costs, while revisiting their retirement strategy – the products and assets they invest in.”

The report and associated case studies have been published on an interactive website developed by Ensombl and Challenger to support financial advisers engage with clients about the impact of inflation on their retirement income and the options available to mitigate it over the long term.

“It is essential advisers are equipped to help their clients navigate a path that optimises both their income and the longevity of their investments,” Mr Daniel said.

“Launching the online resource centre was a priority to support advisers as they work with retirees and those considering retirement who are justifiably anxious about the vulnerability of retirement incomes to rising living costs.” Challenger Limited A.B.N 85 106 842 371. Disclaimer: The forward-looking statements, estimates and projections contained in this release are not representations as to future performance and nothing in this release should be relied upon as guarantees or representations of future performance.

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