Beware spin on retirement drip feed

OF COURSE it’s a good idea – according to the financial services companies, the banks, the advisers, the fund managers, the asset allocators, the superannuation funds and the government, that is.

We should stop people withdrawing lump sums from their super and make them go on the drip feed.

A regular income stream, a MyRetirement product, a super pension, an annuity – call it what you like. Reverse lay-by, time repayment, prepaid hire purchase – it’s a drip feed of our money back.

As unappealing as that sounds for most people, especially after 40 years of having our super locked up and untouchable, the “income stream” is being pushed as the perfect solution for the finance sector and the government.

And it’s packaged up and presented as something for “our own good”.

We, the people, can’t be trusted with our own money because we might just go out and spend it.

That just wouldn’t do, no siree – if people could spend their own money, how would the superannuation sector keep their fingers in the pie? No, no, no.

But an income stream, instead of lump sum withdrawals? Now, that’s a plan!

A plan to provide another long-term income stream for the finance sector, that is.

Encouraging (or forcing) retirees to take a pension from their super fund guarantees the finance industry 20–30 years of fees.

Instead of buying a car, paying off the mortgage or having a holiday when we retire, we’ll be stuck with our debt, the cranky old Mitsubishi and no holiday.

But we’ll have our brand new “income stream”. Yippee.

Our money will be locked away for another few decades as the finance sector eats away at the balance and the government controls our decisions.

This plan ensures the government will cough up even less in age pension payments, as the brand new magical “income stream” will, naturally, reduce our age-pension entitlement. Happy government. And don’t be sucked in by the propaganda the government and the finance sector are going to push to get this little plan happening.

Retirees should be able to choose to spend their lump sum and then get a full age pension. That’s their choice and their risk.

What god said those who wasted or chose to spend their money during their lifetime were more deserving of an age pension than retirees with a nest egg?

What about the lifetime some people spent betting on horses instead of saving?

What about households who chose to blow 10 grand every year in Bali instead of saving? What about the people who spent a fortune on a luxury car to watch it devalue, instead of saving?

Who says retired people aren’t allowed to make the same decisions about how they spend their money as working people?

The government and the finance industry, that’s who.