Helping your clients turn healthy living into stronger retirement outcomes

South Africans are living longer than ever, thanks to advances in healthcare, greater health awareness and healthier lifestyles. While this is a positive development, it also creates a growing retirement challenge.

The healthier clients are, the longer their retirement savings may need to provide an income.

For financial advisors, helping clients prepare for a retirement that could span two or even three decades requires more than selecting an appropriate investment strategy. It requires helping clients build the behaviours that support sustainable retirement outcomes over the long term.

Research and industry experience consistently show that retirement success is influenced by more than just market performance.

Two of the most important drivers of better outcomes are preservation and consistency: preserving retirement savings when circumstances change and contributing consistently over time.

Yet these are often the very behaviours clients find hardest to maintain.

This is where Discovery Invest’s shared-value approach creates a unique opportunity.

As clients live longer, healthier lives, the behaviours that support good health and strong retirement outcomes become increasingly interconnected.

By linking health engagement with disciplined long-term investing, advisors can help clients build the habits that support stronger retirement outcomes through retirement savings enhancements, fee discounts and fee refunds.

Preservation and consistency for healthier, longer lives

Longer lives mean retirement savings need to work harder than ever before. A retirement that lasts 25 or 30 years places significantly greater demands on accumulated savings than previous generations may have anticipated.

Healthier lives often require greater retirement provision.

For this reason, preservation and consistency have become increasingly important components of retirement planning. Small decisions made throughout a client’s lifetime, such as pausing contributions, withdrawing savings prematurely or disengaging from a long-term investment strategy, can have a meaningful impact on retirement outcomes.

Conversely, clients who contribute consistently and remain invested over the long term are better positioned to benefit from the cumulative effects of disciplined saving and long-term investment growth.

The challenge, however, is that maintaining consistency over many years is rarely straightforward.

The challenge of staying the course

Even clients with the best intentions can struggle to maintain long-term saving habits.

Career changes, family responsibilities, economic pressures and market volatility can all create moments where retirement saving falls down the priority list. Over time, these interruptions can reduce the amount available at retirement and make it more difficult for clients to achieve their long-term goals.

This is particularly relevant in an environment where clients are living longer and may need their savings to support a longer retirement journey.

Increasingly, value comes from helping clients maintain the behaviours that support retirement success, especially during periods when staying committed becomes more difficult.

Rewarding the behaviours that matter most

The Discovery Retirement Optimiser | Health is designed to reinforce and reward long-term retirement saving. It extends the existing Retirement Optimiser technology to members of qualifying Discovery Health Medical Scheme plans.

By linking healthy behaviours with retirement value, clients are encouraged to remain engaged with both their health and their financial future.

The Discovery Retirement Optimiser | Health extends Discovery’s shared-value approach by recognising that healthier lives often require stronger retirement outcomes.

“This shared-value approach is already driving meaningful behaviour change,” says Estee Sevenster, head of technical marketing at Discovery Invest.

“Clients are starting to invest an average of 3.5 years earlier, and those who receive boosts make 69% more additional contributions than those who do not.”

Clients can receive immediate fee discounts of 60-80% on qualifying asset management fees based on their Vitality status, and at retirement, a Health Plan Optimiser provides savings enhancement of up to 26% paid into their retirement income plan and up to 60% of admin fees paid back.

Post-retirement, clients can receive income boosts of up to 50% with the Discovery Lifespan Linked Income Plan or Living Annuity and at age 80, receive guaranteed income with the Discovery Lifespan Linked Income Plan.

The Discovery Retirement Optimiser | Health: healthy living and disciplined long-term investing working together to create enhanced value at retirement. Source: Discovery Invest

For advisors, these benefits create a tangible link between healthy engagement, disciplined investing and retirement value.

As clients live longer and potentially spend more years in retirement, rewarding preservation, consistency and long-term commitment can play an increasingly important role in helping them build sufficient retirement savings.

Supporting advisors and clients over the long term

By linking healthy engagement with disciplined long-term investing, Discovery Invest helps reinforce the behaviours that matter most, including preservation, consistency and long-term commitment, while helping clients build greater value at retirement.

This creates another way for advisors to demonstrate value beyond product selection and portfolio construction.

“The most effective retirement solutions do more than provide access to markets,” adds Sevenster.

“They help clients build the behaviours that support long-term success. By rewarding consistency, engagement and commitment, these solutions are designed to help clients achieve stronger retirement outcomes while giving advisors additional ways to create lasting value.”

Brought to you by Discovery Invest.

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