The 'four L' framework for a rewarding retirement

Four guidelines that Australians can use to help plan for a retirement that offers greater flexibility and certainty.

Retirement is no longer expected to be a short chapter in our lives. Thank goodness for that! Australians can expect to live, on average, into their 80s and, in many cases, will be retiring with greater wealth than previous generations.

However, this increase in life expectancy can bring with it new financial uncertainties and raise important questions.

How long will I live? How can I make my money last? Will I be able to leave something for my family? These are common questions among retirees.

The four Ls

Generation Life's LifeIncome product is designed for retirees who make plans based on four factors: longevity, lifestyle, legacy and liquidity.

Let's take a closer look.

Longevity is often retirees' biggest uncertainty and the greatest barrier to spending confidently.

It may help to consider the longevity of family members, using online calculators to estimate potential lifespans.

But there is an easier option. Investing part of your retirement savings in a lifetime income product such as Generation Life's LifeIncome can help manage uncertainty by providing income for life.

Lifetime income products provide a regular income for life and can offer greater flexibility in how retirement savings are spent or invested.

This brings us to lifestyle matters.

Research shows retirees are more likely to spend lifetime income as it can reduce their reluctance to spend and support better retirement lifestyles.

The third L is legacy, another area where lifetime income products can help.

Guaranteed for life

A lifetime income stream can be passed on to a surviving spouse or bequeathed as a lump sum to other beneficiaries.

For those who prefer to give during their lifetime, regular income can help fund anything from a grandchild's education to a family holiday.

Lifetime income products such as Generation Life's LifeIncome can help turn capital into a regular income guaranteed for life. But what about the fourth and final L, liquidity?

As a general principle, lifetime income products can support regular spending, while other retirement assets may fund larger, one-off expenses.

How much should you allocate to a lifetime income stream?

A financial adviser can play a valuable role in helping you decide whether investing some of your savings in a lifetime income stream guaranteed for life is right for you.

Talk to your adviser to discover how an income guaranteed for life could help manage uncertainty and enhance the quality of your retirement lifestyle.

Get stories like this in our newsletters.