Product showcase: A guaranteed future

Retirement income products and annuities have come a long way in recent years, which is particularly timely as retirement confidence wanes amid ongoing geopolitical uncertainty and the rising cost of living.

Australians are also living longer; according to the Actuaries Institute, the cohort life expectancy of Australian males age 60 is 87.9 and for a females it is 89.8 - with at least half likely to live longer.

As such, solutions that offer reliable, guaranteed income that won't run out are increasingly attractive to both financial advisers and their clients, and Allianz Retire+ head of technical services Justine Marquet has noticed a renewed urgency from advisers in the market for annuities.

"What we're hearing consistently from advisers is that the conversation has shifted from how much clients have saved, to how reliable their income will be in retirement," Marquet says.

"We're operating in an environment of heightened volatility, elevated sequencing risk, and far less reliable diversification than advisers have historically relied on."

Marquet highlights the recent experience of bonds and equities moving together in response to geopolitical and macro-economic shocks, which can wreak havoc on portfolios and retiree savings.

Equity and bond market selloffs, such as that of March 2026, or the outbreak of the Russia / Ukraine conflict in 2022, are recent examples of this dynamic.

"Retiree portfolios are most exposed in the first decade of retirement, and for advisers, that creates a real challenge," Marquet says.

"A negative market event early in retirement can materially change client outcomes, not just balances, but confidence and sustainability of income. That's why advisers are revisiting income focused solutions.

"And it's not just as a reaction to short term market noise, but as part of a more deliberate strategy to protect retirement income and create certainty where it matters most, to provide cashflow for life."

Marquet says this is why advisers have been turning to annuities in building client portfolios, particularly for the role they can play alongside account-based pensions (ABPs) and other income strategies.

"We're not seeing advisers move away from ABPs but rather, they're becoming much more intentional about how different income sources work together," she says.

"Annuities can play an important role in securing a portion of a client's essential income, the income that needs to be paid regardless of what markets are doing."

Using retirement income products allows advisers to have more confidence in how the remainder of the portfolio is invested.

"When we use them this way, annuities aren't competing with ABPs, they complement them. They help reduce the need for market withdrawals in adverse conditions, or the amount needed to be held in cash buckets and can smooth income over time," Marquet explains.

"Importantly, we're also seeing advisers use annuities earlier. Not just at the point of retirement, but in the years leading up to it - particularly to manage sequencing risk while still allowing for growth."

For its part, Allianz Retire+ launched Allianz Guaranteed Income for Life (AGILE). AGILE aims to help convert super or retirement savings into a stable, lifelong income stream with the potential to grow and protect against market downturns.

For example, a 57-year-old who invests 30% of their savings, or $150,000, into AGILE could see their investment grow to say, $285,000 after 15 years. That same person at 72 may receive around $28,800 every year in guaranteed lifetime income.

"At its core, AGILE was designed to do three things well, and it's the way these features work together that really differentiates it," Marquet says.

"The first is growth potential with a safety net. Before a client switches on their lifetime income, their money remains invested. It has the opportunity to participate in markets, while being fully or partially protected against  
downturns."

This allows advisers to continue to help clients grow their retirement savings, without exposing them to the full impact of market falls, particularly around retirement when sequencing risk matters most.

"The second pillar is income you can rely on. Once lifetime income starts, clients receive guaranteed monthly payments for life, and for their spouse's life if they wish. That amount of income will never run out or decrease due to market performance, regardless of how long they live," Marquet says.

"And the third pillar is flexible access to money. The strategy isn't about permanently locking money away. If circumstances change, clients can access their investment, allowing advisers to adjust strategies as life evolves."

Taken together, the three pillars of protected growth, guaranteed income, and flexibility, make AGILE simple to position in practice, as part of the advice process.

"It's not all or nothing, it's a tool that advisers can use to balance growth, certainty, and flexibility within a broader retirement income strategy," Marquet says.

And earlier this year Allianz Retire+ made enhancements to AGILE on the back of direct adviser and client feedback.

This included a significant reduction in fees, halving the product fee to 0.3% per annum, which also applies on a go-forward basis to existing investors.

"For advisers, this materially improves long term value and makes AGILE easier to use as a core component of a retirement income strategy, particularly where clients are investing earlier and holding for longer," Marquet explains.

The other change to AGILE was allowing earlier access to guaranteed income.

"Clients can now commence lifetime income after just one year, instead of waiting three," Marquet says.

"That added flexibility is critical in practice, giving advisers the ability to respond quickly when client circumstances change - whether due to retirement timing, health, or income needs.

"Together, these changes enhance value, simplicity and flexibility, while preserving what makes AGILE structurally different."

Marquet says there are several things advisers should be looking for when comparing annuities if deemed right for their client.

"When advisers are comparing annuities, we'd encourage them to look beyond a single number," she says.

"Income timing and structure is important; does the client need income now, or is there value in deferring to increase future lifetime rates? Is there value in having lifetime income that will never stop or drop due to market performance?"

Flexibility and access to capital are also key considerations.

"Life changes, and advisers need strategies that can evolve over a 30 or even 40 year retirement," she points out.

"Growth potential matters as well. Today's annuities don't have to mean giving up the upside but understanding how protection and returns interact is critical."

Lastly, Marquet says advisers should consider the overall value of the options on offer in the market.

"Not just headline fees, but how the product supports long term outcomes and adviser decision making," she says.

"AGILE fits well for clients who want certainty over part of their retirement income, without giving up flexibility or growth. Ultimately, it's about giving advisers more tools, and more confidence that income will last, regardless of what markets do."

In partnership with Allianz Retire+. This content is for informational purposes only and should not be considered financial advice.