Emerging trends and innovations in retirement income strategies
Retirement is a time to make our money work harder, and exciting products are coming to market to help retirees do just that.
Over 4 million Australians are currently retired. In the next five years, another 710,000 people will join their ranks.
Despite their strength of numbers, retirees often experience financial uncertainty.
That's not surprising.
One of the challenges of retirement is moving from regular employment income to a retirement income that may be less predictable, less regular.
The good news is that innovative investments are becoming available that can tick the boxes for stable, reliable - and importantly - attractive returns.
La Trobe Financial, for example, is excited to launch our ASX-Listed Private Credit Fund, with a target distribution yield of RBA Cash rate +3.25% p.a. paid monthly.*
It's an example of another opportunity for investors to diversify their portfolio to achieve access to low volatility income streams.
Here's what you need to know.
Private credit - a compelling option for retirees
As a multi-award winning manager of private credit for over 70 years, La Trobe Financial understands that anyone building their retirement portfolios should ask three important questions:
- Am I investing in products and strategies I understand?
- Does the investment improve my portfolio's diversification?
- Is the manager a name I trust to perform across the economic cycle?
It may sound like a tall order.
But it can be done.
La Trobe Financial's real estate private credit funds have long been popular with retirees.
Our funds are backed chiefly by an asset all Australians are familiar with - residential and commercial real estate mortgages. We target high-quality borrowers to build a defensive portfolio for our investors.
It's an approach that has rewarded La Trobe Financial's investors with above-benchmark returns over both the short and long term.
The three pillars of our investment strategy
La Trobe Financial's 110,000 investors# benefit from the three pillars of our investment strategy: Quality of assets, diversified portfolios, and a strong margin for safety.
We continue to follow this core strategy with our new investment options.
In 2023, La Trobe Financial launched our La Trobe US Private Credit Fund, giving Australians the opportunity to invest in private credit provided to companies operating in the U.S corporate middle market - one of the world's leading private credit markets.
Now, in 2025, we are pleased to announce the upcoming launch of La Trobe Financial's ASX-listed La Trobe Private Credit Fund.
A new addition to retirement portfolios
The La Trobe Private Credit Fund has been designed with the goal of delivering a premium investor experience.
As a listed fund, investors will enjoy the benefit of liquidity, meaning the investment can easily be converted to cash if necessary.**
What is especially exciting is how the La Trobe Private Credit Fund works.
The fund will combine La Trobe Financial's 12 Month Term Account (Australia's most awarded private credit fund) with US middle market corporate private credit via a complementary investment into the La Trobe US Private Credit Fund - Class A units. The fund is targeting a 50:50 allocation over time.
This unique combination brings several advantages to investors, including:
- Easy access to Australian private credit, which acts as a ballast in the portfolio, helping to deliver steady, regular returns;
- The outperformance of US middle market corporate lending, which has historically experienced low levels of volatility; and
- A geographically diverse, defensive portfolio including senior secured assets coupled with currency hedging of investor capital.
As noted earlier the target distribution yield for the La Trobe Private Credit Fund is the RBA Official Cash Rate plus 3.25% per annum. Of course, there are risks for any investment and investors must consider an allocation only as part of their own overall diversified portfolio.
The end result for investors is a compelling: a low cost, accessible and liquid investment combining equity like returns with fixed income risk.
For Australians in or planning for retirement, a strategic allocation to the La Trobe Private Credit Fund might go a long way to solving the retirement income challenge.
It's a chance to explore the new possibilities of earning an attractive, regular return without the volatility in income that can derail retirement lifestyles.
#Total investors is calculated by adding all individual & joint investors (which includes some investors with a current zero balance in their account) to reasonable estimates of investors investing trusts or SMSFs.
La Trobe Financial Asset Management Limited ACN 007 332 363 Australian Financial Services Licence No. 222213 is the responsible entity of the La Trobe Australian Credit Fund ARSN 088 178 321, the La Trobe US Private Credit Fund ARSN 677 174 382 and the La Trobe Private Credit Fund ARSN 686 964 312 (ASX:LF1). It is important that you consider the relevant Product Disclosure Statement (PDS) before deciding whether to invest or continue to invest in any of the funds. The PDSs and Target Market Determinations are available on our website. Any advice is general and does not consider your circumstances.
*The target cash distribution yield is an objective target only and may not be achieved. Any shortfall in net income generated may result in a distribution payment made out of capital invested. Future returns are not guaranteed and a loss of principal may occur. Investors should review the Risks summary set out in Section 8 of this PDS. The first distribution is expected to be paid with reference to the period ending on 31 July 2025, with July 2025 being the first full month following the Settlement Date.** Unitholders will potentially be able to sell their Units on the ASX, subject to there being sufficient buyers of Units at a price that is satisfactory to the selling Unitholder, the ASX being open for trading and the Units not being suspended from trading.
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