The pandemic has had a significant impact on interest rates and with the official rate now sitting at 0.10 percent retirees are having to re-evaluate their portfolios to ensure their investments are providing sufficient income. Hardest hit are those who are heavily invested in cash as the returns are not what they used to be. In this environment we are encouraging our clients to seek advice and to consider rearranging their portfolios to include a diversity of asset classes that can deliver higher returns over the long term.
Whilst cash has traditionally been considered a safe income stream, with returns in recent years of between 5 and 7 percent this is no longer the case. If you are the type of investor that is more comfortable with a low risk and defensive approach this environment may present some challenges for you.
Although growth assets such as shares and property are considered to be higher risk, with the right advice, a diverse approach and a long term view can deliver alternative income to ensure your retirement plans aren’t derailed.
It is widely expected that this economic environment is likely to remain for several years. This is not a time to be missing your annual review. By keeping us up to date on any changes in your circumstances we can help you make adjustments to your portfolio to ensure your retirement plans remain secure. You are not alone but it is best to take a proactive approach to this dilemma.
General Advice Warning
The information provided in this article is general in nature and does not take into account your particular investment objectives, financial situation or insurance needs; we therefore recommend you seek advice tailored to your individual circumstances before making any specific decisions.
Dobbrick Financial Services (Gympie) Pty Ltd ABN 48 931 205 109 and Dobbrick Financial Services (Ipswich) ABN 86 100 184 521 & DFS Oakland ABN 64 340 527 395 and their advisers are authorised representatives of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306.
