In this guide
Self-managed super fund (SMSF) trustees in retirement phase have very different needs to those in accumulation phase. They need their SMSF to fund an income they can live on, while those not yet retired are trying to create as big a balance as possible.
As of 1 July 2022, all funds regulated by the Australian Prudential Regulation Authority (APRA) are required to have a retirement income strategy as part of the Retirement Income Covenant, which was brought in with the assent of the Corporate Collective Investment Vehicle Framework and Other Measures Act 2021 in February of this year.
Learn more about the retirement income strategies that APRA-regulated funds have published.
While the new Retirement Income Covenant puts a greater focus on how all superannuation trustees satisfy the income requirements of members in retirement, SMSF trustees will not be legally obliged to comply.
However, investment strategies developed by SMSFs have always been required to explain how the investments they choose meet the individual needs of members. When there are members in both accumulation and retirement phase, the investment strategy needs to explain how the needs of both kinds of members are being met and therefore should already include a retirement income strategy for those members in, or close to, retirement.
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