life-cycle annuity strategies

David Atkin, CEO, Cbus

Life-cycle, Annuities Less Relevant For Cbus

David Atkin on Retirement Products

The unique characteristics of Cbus members make life-cycle and annuity strategies less attractive to them, the pension fund's chief executive said at the inaugural [i3] Pensions Portfolio Forum.

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Key Points of Member Survey

Key points from member segmentation research conducted by Coredata in 2019.

Cbus members start their working lives earlier, and start having families earlier:

• 12 per cent of members are under 25 years
• 27 per cent of members under 25 years have dependents
• This compares to 11 per cent of the general population aged under 25 with dependents

Cbus members’ working lives are characterised by insecure and intermittent work:

• 40 per cent of construction workers are sole traders
• 17 per cent are in casual employment
• 52 per cent say they don’t work across the whole year
• 49 per cent work part time in their main job
• This is compared to 33 per cent of the general population who work part time

The physical nature of the work means they are more likely to experience injuries and health problems:

• Construction is one of the top three most dangerous industries to work in
• Serious workplace injury claims are twice as high for construction workers as other occupations
• The suicide rate in construction is 75 per cent higher than other industries

Construction workers are often forced to retire early:

• Over a third of members working in blue collar building and construction jobs feel their health and age is affecting their ability to work, and around one third of all members expect to retire early.
• Members aged 45 to 49 are three times more likely to be out of the workforce compared to the general population.
• The average retirement age for labourers is 58 years old, and 35 per cent of labourers retire before they turn 55.