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SRP: Life Insurance in super after retirement?

Discussion in 'Financial Planning Study Group' started by CJ. Wentworth, 27th Feb, 2010.

  1. CJ. Wentworth

    CJ. Wentworth Well-Known Member

    Joined:
    9th Mar, 2008
    Posts:
    92
    Location:
    Cairns, QLD
    Hi guys, hope all is well.

    I'm currently working on my SRP assignment and am up to question 5 which deals with Pensions and Allowances. The predominant focus seems to be on the means testing of the age pension (income and asset test).

    The client currently has life and total permanent disability insurance through his super, however he is retiring in one month. Under the Assets test the surrender value of life insurance is assessable.

    Is his current life and TPD through super considered an asset according to the Assets test?
     
  2. study

    study Member

    Joined:
    3rd May, 2009
    Posts:
    11
    Location:
    Adelaide
    hi.
    i did not inclulde it in the assessment - and they didnt say i should add it for my resub - only have to redo q 6.
     
  3. AsxBroker

    AsxBroker Well-Known Member

    Joined:
    8th Sep, 2007
    Posts:
    1,448
    Location:
    Sydney, NSW
    Hi CJ,

    Most super funds will reduce life, tpd and tsc to nil once a member reaches age 65. Also insurances aren't generally available in Account Based Pensions.

    Cheers,

    Dan
     
  4. HOCFP

    HOCFP Active Member

    Joined:
    29th Aug, 2010
    Posts:
    27
    Location:
    adelaide
    Question 2 SRP Assignment Help plz

    I dont feel using online calculators is the approach for me, as it just confuses me more:
    .
    Although i have made some slight progress with the following:

    For estimating the capital required all i have done is added all there investment assets to get a figure. After I have multiplied based on karen's life expectancy lets say 24 years and multiplied this by there desired income to gain a figure. This figure I believe in a perfect world what they would need to have as capital.

    Now when analysing the gaps with what they have to what they need i have subtracted what they have to what they need and used that as a starting point to devise potential strategies around boosting thier super balances.

    My only concern with this approach is they have a gap of over 500k, surely that is not correct. I mean part of the remainder of the question states that we need to advise on different types of contributions to boost thier balances and also the age pension factors.

    Am i on the right track?