Produced in partnership with TAL
Between 2022 and 2032, the portion of Australia’s superannuation assets held by over-65s is expected to jump from 40 per cent to 55 per cent (Note 1). As the industry evolves to better serve the needs of their older members, there is a growing focus on delivering products that will help members manage their retirement savings more effectively.
However, designing these products is only part of the equation – just as important is the underlying member experience. This includes how members learn about their product options and choose the right one for their circumstances, through to how they interact with the product over time and access any advice they need along the way. With retirement solutions, we also have an opportunity to think through a digital-first lens, without the need to retrofit to legacy products and systems.
Understanding member needs
For many Australians, choosing how to structure their retirement income is a daunting task. Members want to know how much money they’ll need to retire comfortably, how much they’re likely to have, and how to make their nest egg stretch further. According to TAL’s recent research (Note 2), 51 per cent of pre-retirees and 37 per cent of retirees are looking to their super fund for these answers.
This presents an opportunity for funds to offer personalised, relevant and timely support so members can make informed choices. This might include building interactive tools that help members estimate their retirement income, compare different products to understand the trade-offs, and manage the interaction between their superannuation, investments and Age Pension entitlements.
Spending habits are likely to change between the member’s early, active retirement years through to when they eventually slow down. Dynamic calculators that allow members to adjust their income and spending strategies accordingly could help build financial confidence, especially as TAL’s research shows a significant drop in confidence among members after age 80.
As members move through the phases of retirement, they may also face new challenges such as reduced mobility or cognitive decline. So, as funds continue to build out their retirement propositions, they could look to incorporate insurers’ health support tools that empower members to improve their wellbeing. This could extend to connecting members with health services available within their community.
Member testing and intuitive design
As funds develop their retirement products, tools and services, it’s important to ensure they will be relevant and user-friendly for as many members as possible. This means understanding the preferences, behaviours and challenges of a wide range of older users.
Member testing is essential for evaluating the effectiveness of these solutions and adapting their design or functionality if needed. It is also helping funds validate how the solutions perform among different cohorts and in different scenarios or contexts.
Design principles should take into account factors to help funds cater to the diversity of their membership by ensuring that members have an intuitive and consistent experience regardless of factors such as their age, gender, ethnicity or financial literacy. A focus on accessibility will ensure the solutions are effective and usable for members facing challenges like visual, auditory, cognitive and motor impairments. The design should also offer the flexibility for members to customise the experience if they wish, particularly as their needs and preferences change over time.
Collaboration across the ecosystem
TAL’s own member testing indicates that members are less inclined to take up their fund’s retirement product if the overall journey is presented as multiple components. It’s therefore worth creating a holistic journey that seamlessly carries members from the product awareness phase to selection and onboarding, through to when they’re accessing benefits and auxiliary services.
Different players within the ecosystem can play a role in building this integrated journey. This includes life insurers, who can deliver products that protect members against longevity risk, with the support of digital specialists to design a simple and accessible member experience.
Funds should also arm their advice partners and frontline teams with the right education and training so members can access the guidance they need at different points in the journey. And as the fund’s retirement offering matures, there is further potential to extend the member journey to provide access and options for health and aged care services.
By considering the evolving needs of older Australians, and drawing on the right expertise and insights to meet those needs, funds will be able to help more members achieve their income and lifestyle goals so they can enjoy a happier and healthier retirement.
Jenny Nguyen is general manager, digital experience at TAL.
For more information on how TAL can help you give your members confidence in retirement, visit grouphq.tal.com.au/retirement.
Notes:
- Retirees projected to own 55% of all superannuation assets. Rainmaker Information. 2023.
- What I wish I knew about retirement. TAL. 2024.
