Unlocking Optimal Retiree Drawdown Decisions
The Mandate: Detangling the Drawdown Dilemma
The transition from saving for retirement to spending in retirement is arguably the most complex financial decision a person will ever make.
A key question is whether superannuation funds can help retirees make optimal drawdown choices so they spend what they can afford while
avoiding the twin risks of underspending and overspending?
Most strategies rely on theoretical models. We delivered the actual behavioural data needed to close the gap.
What We Did
We partnered with Super Consumers Australia (SCA) to conduct the landmark Detangling Drawdown research. SCA commissioned this large-scale, mixed-methods project to move beyond assumptions and truly understand the lived reality of retirement finance.1
Our study focused on individuals aged 65 to 83, aiming to uncover the real-world motivations, knowledge gaps, and decision-making processes that define how this generation manages their retirement capital.
The Research: Beyond the Minimum Withdrawal
Using a sophisticated blend of qualitative and quantitative research, we drilled down into the behavioural and knowledge drivers of drawdown choices.
The results challenged conventional wisdom and provided a powerful new perspective for policy and product design:
| Key Insight | Strategic Implication |
| Minimum Drawdown is the Default: Retirees often only withdrew the government-stipulated minimum, driven by perceived need or simply following advice. | Take-out: The industry must stop criticising their members for behaviour that is actually perfectly rational |
| The Non-Homogenous Retiree: The over-65 demographic with inactive super accounts is highly segmented. Some are wealthy and don’t need the capital; others are temporarily non-working and may return to the workforce. | Take-out: Segment your market. |
| Accumulation While Working: A significant number of individuals over 67 keep accounts in accumulation mode because they are still actively employed. | Take-out: Develop onboarding and advice strategies that reflect the reality that some people will work beyond the traditional retirement age. |
| Tax Benefit Blind Spot: Crucially, very few people in this age group understood the significant tax benefits available when transitioning super into a pension phase. | Take-out: Communicate to retirees in plain language |
From Research to Advocacy: Impacting Policy and Products
The findings provided SCA with the critical evidence base to drive meaningful change. They summarised the powerful insights in their public-facing content and leveraged them directly in their advocacy work to influence regulators and industry standards.
Don’t build your retirement products or policies on outdated assumptions. If you need to understand the true behaviour and motivations of high-value consumer segments making complex financial decisions, data is your most powerful asset.
Contact Sue
We would love to hear from you, and are always happy to talk through research methods and options with you, if you are not sure what you need. Why not get in touch for a free, obligation-free, and confidential conversation.
Find out more about Susan Bell Research.
