NGS retirement product aims for capital growth

NGS Super has launched a retirement income product that focuses on capital growth and income return while insulating against equity market risk, as it responds to a huge demographic shift.

Named the Income Generator, it looks to gain a capital return before tax and fees above Australian inflation, and an income return before tax and fees above the Reserve Bank of Australia cash rate.

It also looks to curb negative returns during investment downturns.

NGS Super CEO Anthony Rodwell-Ball said the option chooses assets with characteristics such as capital preservation, regular stable income, inflation off-set, capital growth and risk mitigation.

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It also has an equity risk management process.

"Retirees can buy an annuity, but it's potentially expensive, depending on when you buy and how long you live. You can choose an account-based pension or you can take a lump sum, buy a caravan and go on the age pension.

"Our modelling shows that a portfolio focused on yield is particularly suited to retirees in Australia who want a reasonably stable income stream, but who also want their capital to last as long as they do," Rodwell-Ball said.

Income Generator looks at getting income from investment earnings; it has an asset allocation of 30 per cent Australian equities, 22 per cent global equities, 4 per cent growth alternatives, 4 per cent international property, 20 per cent Australian property, 4 per cent defensive alternatives and 16 per cent cash and fixed interest.