For retirees who elected to move from a mix of growth and defensive assets while in accumulation to 100% defensive assets in retirement, the income experience since the GFC has been very challenging.
For the last fourteen years, income growth volatility for term deposits is about double that of Australian equities. For retirees, the move to 100% defensive assets has seen income fall sharply since the GFC. Equity income quickly recovered after the 2008 share market fall, whereas income from terms deposits fell significantly more than equity dividends and after a brief recovery, has continued to fall to very low levels.
Asset allocation for retirement income is and should be very different to the accumulation strategies adopted by employees during their working life.
Martin Currie Australia, a Legg Mason investment manager, has designed a number of equity strategies to generate low risk, high quality income from Australian companies with strong, sustainable free cashflow. Read more >
Important Information
The information in this document is of a general nature only and is not intended to be, and is not, a complete or definitive statement of matters described in it. It has not been prepared to take into account the investment objectives, financial objectives or particular needs of any particular person. Legg Mason Asset Management Australia Limited (ABN 76 004 835 849 AFSL 240827) does not guarantee any rate of return or the return of capital invested. Martin Currie Australia is a division of Legg Mason Asset Management Australia Limited. Past performance is not necessarily indicative of future performance.
Investments are subject to risks, including, but not limited to, possible delays in payments and loss of income or capital invested.
These opinions are subject to change without notice and do not constitute investment advice or recommendations.
