Super funds would meet strong headwinds in the next 10 to 15 years as baby boomers retired and moved away from equities as income sources, said Schroders’ CEO, Greg Cooper.

Demographic change in Australia and around the developed world would be responsible for vast changes in society over coming decades, posing some extremely difficult challenges for the country’s superannuation industry.

These demographic changes would prompt product development, said AIST’s CEO Fiona Reynolds.

At present, average account balances at retirement were still quite low and many retirees took a lump sum, but this would change as account balances rose, she said.

Schroder’s Cooper said that traditional thinking on asset allocation through life would need to alter, particularly given the “unwind” of baby boomers from equities.

At the simplest level, the returns and diversification benefits offered by an investment, rather than a pre-determined asset allocation, should drive portfolio construction of any post-retirement solution, he said.

Reynolds said innovation in post-retirement products would follow rising account balances, particularly after the Government’s Stronger Super changes were bedded down.

“Since the global financial crisis in particular, it’s been clear that more retirees want income-certainty rather than returns that shoot the lights out,” she said.

“However there isn’t a one-size-fits-all solution to post-retirement. There needs to be a range of products for different people with different circumstances.”

Schroders’ Cooper said target-date funds were not necessarily the answer to the equities’ headwinds, and superannuation funds should look to structure their offerings, he said.

Cooper is speaking on demographics and asset allocation in a post-retirement world at the Post-Retirement Conference in Melbourne on Thursday March 10, at the Sofitel on Collins, and Reynolds is chairing a panel on CEOs.

For information and registration, go to

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