CFS plots 'largest' retirement product expansion with new alliance

Colonial First State (CFS) is plotting the "largest-ever" expansion of its retirement offerings through a multi-partner alliance to enhance retirement solutions.

Developed with Challenger, Generation Life, and BlackRock, the partnerships transform product-led approaches to a "whole-of-life" retirement model for lifetime income solutions combining fixed, CPI and investment-linked annuities.

For Challenger, CFS is integrating innovation retirement income solutions (IRIS) and the full suite of annuity capabilities.

Meanwhile, Generation Life's investment-linked IRIS will be integrated onto FirstChoice and investment bonds onto FirstChoice and CFS Edge, which will be brought forward by BlackRock's investment capabilities to deliver those products.

CFS members will also benefit from BlackRock's experience delivering LifePath Paycheck in the US - an integrated target date strategy which provides eligible participants the ability to purchase a guaranteed income stream for retirement payable by third-party insurers selected by BlackRock.

The rollout will begin with the introduction of the Retirement Income Optimiser on the FirstChoice platform, as well as a Pension Bonus feature for eligible CFS members in August, with further solutions to be introduced over the next 12 months.

AMP, also offering retirement income products via AMP Super and North platform, stated they are "pleased" to see uplifts like this across the retirement segment.

"Our industry needed to step up to help Australians be confident about their retirement," AMP chief executive Blair Vernon said.

"AMP has led the market in bringing these retirement income solutions to market, and while no other provider offers the range of solutions we do, we are pleased to see others following our lead.

"We will continue to innovate and take the market forward as we expand our retirement offers."

Meantime, this same week MLC was celebrating hitting the $500 million milestone on MLC Expand, saying it is "becoming the fastest growing IRIS solution".

"This is a significant milestone for MLC Expand and shows the demand we're seeing from financial advisers for MLC Retirement Boost," MLC Expand chief executive Liz McCarthy said.

"The way that Australians think about retirement is changing and the demand for this solution is a testament to that. People want more personalisation and flexibility in their retirement planning and MLC Retirement Boost gives them this, while increasing the potential of super for more people and potentially creating higher retirement income, from their first super contribution."

MLC Expand also has a partnership with Challenger as well as TAL.

Commenting on its new partnerships, CFS Super chief executive Kelly Power said the new offering transforms the perception of retirement.

"CFS has built its reputation on being a leader in retirement, and this expansion reflects a material capital commitment to supporting Australians across their entire retirement journey by providing the most comprehensive whole-of-life offering in the market," Power said.

"By bringing together best-in-class global investment capability, local market-leading lifetime income expertise and tax-effective structures, this integrated offering is designed to meet the increasingly complex financial needs of Australians.

"It recognises that retirement is no longer a single event, but a long-term financial journey that requires different solutions over time."

Challenger chief executive and managing director Nick Hamilton added that the alliance brings real significance beyond partnership mechanics.

"Australia has been very successful at helping people accumulate super, yet far less effective at helping them convert those balances into income they can actually depend on," Hamilton said.

"CFS is embedding lifetime income at scale, and this collaboration tackles one of the hardest and least-solved problems in the retirement system - how to turn savings into income for life."

Further, Generation Life chief executive Felipe Araujo said the Australian retirement system is transforming, where advice is filling the gap in introducing retirement products for retirees.

"Generation Life is proud to be selected as a partner of choice by CFS to help co-develop next-generation wealth management and retirement solutions. Australia's retirement system is entering a new phase, where advice delivery is keeping pace with the increasingly dynamic needs of Australian retirees," he said.

"This alliance represents one of the first truly integrated retirement ecosystems of its kind in Australia, bringing together income, tax efficiency and intergenerational wealth planning in a more connected way to better support Australians through retirement and across generations"

BlackRock head of Australasia Jason Collines said: "CFS has been a longstanding whole portfolio partner for BlackRock, and we are proud to continue supporting its MySuper LifeStage portfolios."

"Working alongside Generation Life, we look forward to contributing to the next phase of growth as CFS expands the retirement toolkit for advisers and members, and moves towards more integrated, end-to-end retirement solutions that help more Australians experience financial wellbeing."