Summary
JANA believes a key outcome of the SPS515 requirements is the enhanced focus on retirement
adequacy. That is, what amount of retirement income is a superannuation fund’s default MySuper option expected to deliver for a fund’s membership cohorts? Assessing retirement adequacy given the complex Australian retirement system can be challenging but we firmly believe this important endeavour can be achieved. We have outlined a practical, robust and flexible framework in the thought piece below.

In this thought piece

The key elements of JANA’s Framework for assessing retirement adequacy that are covered in this thought piece include:

• Step 1: Construction of representative fund members
• Step 2: Consideration of appropriate retirement adequacy objectives
• Step 3: Stochastic assessment of likelihood of meeting retirement adequacy objectives

In this thought piece we have also included analysis from our proprietary model (JANA Solve).
Key takeaways

• JANA is strongly supportive of the focus on retirement adequacy as part of SPS515. In this thought piece we have provided a framework for superannuation funds to consider when working through these issues.
• We believe that retirement adequacy is a metric that RSE Licensees should be incorporating into the inaugural 2020 Business Performance Review.
• We have developed the capability within our proprietary model (JANA Solve) to undertake
• retirement adequacy modelling for funds as part of the mandatory SPS 515 requirements.
• JANA is supporting our clients where assistance is required from a holistic level or for a specific
• aspect of member outcomes related work and stand ready to be called on further.