Scott Phillips

Retirees are too often left struggling with their finances without the help and guidance they need, according to one of WA’s leading institutional investors.

Chief Investment Officer Chris West says that for many Australians, retirement is a stressful period but that it doesn’t need to be that way.

“Everybody deserves dignity in retirement. For many Australians unfortunately it can be a time of financial stress, particularly for those retirees without enough super or those who are reliant solely on the Age Pension,” he said.

With so many underfunded retirees, and a significant number of them carrying debt, Chris believes that using home equity as a source of retirement funding can be a viable solution.

“For many retirees their home is by far their most valuable asset and it should be considered as a potential source of retirement funds, in conjunction with the right plan and advice.

A highly experienced institutional investor, Chris is the Chief Investment Officer at WA Super and was also a finalist in the national 2019 Conexus Financial Superannuation Awards Chief Investment Officer of the Year Awards.

Committed to improving the lot for Australian retirees, Chris has just joined a WA start-up created specifically to assist retirees with their retirement planning and finances.

Chris is the latest addition to the experienced team of finance professionals at Smooth Retirement, a new specialist equity release advice and funding service for retirees, coming on board as a member of the company’s Advisory Panel.

“I am excited about the opportunity to contribute to an innovative, West Australian start-up aiming to build professional equity release as a genuine compliment to other forms of retirement income and helping retirees in an effective and accessible way.”

Established in 2017, Smooth Retirement was created to assist the great number of retirees who had little or no super left and were struggling to fund the remaining years of their retirement, with just the Age Pension as their only source of income.

Smooth Retirement Managing Director and CEO Scott Phillips said the current lack of options and guidance for retirees had been the motivation to create the company.

“I was working for a large super fund and seeing all these people in real stress trying to work out how they were going to get by on the little in savings they had left.

“And all the while the family home, which was by far the greatest source of wealth for these people, was not even discussed.

“There were all these people feeling like they’d failed, feeling poor and worried yet living in homes worth $800,000 or more and it just seemed ludicrous to me.

“I wanted to find a better way and one that treated them with dignity and helped them work out the best way to access all their wealth, with proper planning, and using some of their home equity to refinance debt and / or top up their income so they could live better.”

Scott said Chris was an extremely valuable and strategic addition to the current panel of advisors, adding considerable depth and experience to the Smooth Retirement team. “We are delighted to have Chris on board and know that we will benefit enormously from his contribution,” he said.

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Scott Phillips

Equity release specialists Smooth Retirement and Pension Loans Scheme platform Pension Boost today announced they have entered into a strategic partnership.

The companies have teamed together to augment their compatible capabilities and to deliver greater value to clients through the provision of expert advice and assistance with all forms of home equity release.

Smooth Retirement and Pension Boost both provide specialist professional services to assist the growing number of income-poor, asset rich retirees to access some of the saved equity in their homes so they can improve their lifestyles and live better in retirement.

Pension Boost provides Australia’s only national independent specialist service for seniors wishing to access the Federal Government’s reverse-mortgage style Pension Loans Scheme (PLS).

Smooth Retirement delivers holistic equity release planning and broking in an all-in-one nationwide service, providing access to, and independent advice on all commercially available products and providers.

Smooth Retirement CEO and Managing Director Scott Phillips said the partnership formally recognised the commercial and ethical alignment of the two business models – both being pure fee-for-service, no commission and client-focused.

“Working with Pension Boost, we can offer a much superior and streamlined service to clients seeking equity release by identifying the best solution for them and assisting them to access it – whether that be the Government’s PLS, or commercial reverse mortgages and alternative equity release products.”

Pension Boost CEO and Founder Paul Rogan said equity release was becoming increasingly sought after by seniors who are wishing to live a better life but are ‘income poor’, noting there has been unprecedented levels of enquiry into the Pension Loans Scheme since the eligibility rules were expanded in July 2019 opening the Scheme up to vastly more seniors.

“More and more Australian retirees are looking for ways to supplement their retirement incomes and seeking assistance and advice to help them navigate their way through the often confusing and conflicting information and lengthy application process.”

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Scott Phillips

With reverse mortgages and other types of home equity release gaining in popularity, a new equity release service has entered the market.

Smooth Retirement is Australia’s first independent equity release specialists, combining equity release advice and broking in a new all-in-one service.

In addition, the Perth-based company has this week launched a new free guide for consumers and industry – the first of its kind – which explains all the available types of equity release products, their different features, varying applications as well as the pros and cons of each.

“Equity release is complex and understanding how the different products work and which one is the best for you is challenging. And while access to independent expert advice is all important when planning retirement finances, the traditional channels can be cost prohibitive, and difficult to navigate, for many retirees,” said Smooth Retirement CEO and Managing Director, Scott Phillips.

“We set about creating a specialised service that is accessible (online or via a telephone), friendly, much more affordable and one which helps retirees learn about all of their available options and what’s possible.

Mr Phillips, a former banker and financial planner, said delivering a better deal to retirees was the motivation behind the creation of Smooth Retirement.

“We’re independent and not aligned to any lenders, providers or banks and we charge fully disclosed, upfront and fair fees, taking no commissions or kickbacks from lenders.

“We work with and/or refer to all the reverse mortgage lenders and equity release providers in the country and whether it’s a reverse mortgage, the Pension Loans Scheme or a part-sale property transaction, the most important step is proper planning and making sure if you do choose to use some of your home equity now, you have enough for your later years of retirement, including your aged care needs.”

Mr Phillips said there was currently 8 equity release style products on the Australian market, with more expected to come in future years. Current providers and products include:

• Heartland Seniors Finance
• Household Capital
• IMB Bank
• DomaCom Seniors Equity Release
• HomeSafe Wealth Release
• Pension Loans Scheme (Federal Government)
• HomeStart Finance (SA)
• La Trobe Financial (Aged Care Loan)

The growth of the equity release market is being driven by the nation’s ageing population, particularly the large number of baby boomers, many of whom are asset rich yet cash poor – and also retirees who can no longer rely on returns from record low interest rates.

An increasing number of this cohort are looking for ways of boosting income, refinancing debt or accessing lump sum capital without having to sell their homes and downsize.

The Federal Government has also contributed to this renewed interest with the expansion, and essentially ‘re-launch’ of its own reverse mortgage-style offering, the Pensions Loans Scheme (PLS), in July this year.

One of Australia’s most prominent and largest reverse mortgage lenders, Heartland Seniors Finance, has experienced a significant increase in enquiry and take up of its award-winning reverse mortgage product in the last three years.

“As Australia’s leading reverse mortgage provider, we have experienced unprecedented month-on-month growth in settlements and enquiries in recent years, particularly the last two years,” said Jeff Murray, Heartland Seniors Finance, Head of Distribution.

New market entrant Household Capital has gone from strength-to-strength since launching its reverse mortgage, known as a “Household Loan”, in March this year. The company now offers Australia’s lowest interest rate at 5.15% – currently lower than the Government’s Pension Loans Scheme at 5.25%.

More than a loan, Household Capital’s model enables people to strategically deploy the otherwise dormant equity in their home in ways that boost their income steam and improve their financial position in the long-term.

Also new to the Australian market is a retiree-specific offering from fractional property investment platform DomaCom. The company’s Senior Equity Release product was launched in July. This new generation part-sale property transaction is the first equity release product to be launched as a financial product with its own PDS. Like other products on the market, it can also be used to fund any purpose, including aged care.

DomaCom CEO Arthur Naoumidis said the benefits to seniors was quite compelling, with one of the biggest advantages being that the product was not postcode restrictive.

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