Assumptions update (Tasman v6)

19 August 2021 (Tasman v6)


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Or find out more at www.optimofinancial.com.au

Summary

The Optimo default returns for some assets have been updated in Pathfinder:

  • Asset returns are based on Lonsec Capital Market Assumptions June 2021, including franking credits for Australian Equities.

  • For cash returns, the current interest rate is 0.1%, however the long term average is assumed to be 1.7%, so:

    • For cash accounts, we assume that the interest rate is 0.1%, and then increases to 1.7% in 2026/27, since cash accounts are more immediate

    • For cash held in shares/managed funds, the long term rate of 1.7%pa is used for all years since it is assumed shares/managed funds are kept for an extended period.

Cases created after the release date will use the new assumptions.  Cases created before the release date will not be affected,

Updated assumptions for shares/managed funds and super investment options

'Superannuation' and 'Pension' refer to returns inside superannuation funds.

'Growth' and 'Distribution' refer to shares/managed funds owned by an individual or SMSF.


Profile

Field

Old value %pa

New value %pa

Secure

Superannuation:

1.9

1.4 

Pension:

2.2

1.7

Growth:

0

0

Distribution:

2.2

1.7

Defensive

Superannuation:

2.74

2.5

Pension:

3.2

3

Growth:

0.65

0.5

Distribution:

2.54

2.5

Conservative

Superannuation:

3.4

3.4

Pension:

3.92

3.9

Growth:

1.3

1

Distribution:

2.63

2.9

Balanced

Superannuation:

4

4.3

Pension:

4.64

4.9

Growth:

1.92

1.6

Distribution:

2.72

3.3

Growth

Superannuation:

4.7

5.2

Pension:

5.4

6

Growth:

2.6

2.2

Distribution:

2.8

3.8

High Growth

Superannuation:

5.4

6.1

Pension:

6.1

7

Growth:

3.3

2.9

Distribution:

2.8

4.1

Australian equities (direct)

Superannuation:

6.1

7.3

Pension:

7

8.4

Growth:

3.6

2.7

Distribution:

3.4

4.3 

Franking credit

70

75

Australian equities (Trust)

Superannuation:

6.1

7.3

Pension:

7

8.4

Growth:

3.6

2.7

Distribution:

3.4

4.3

Franking credit

70

75

Cash (direct)

Superannuation:

0.085

1.4

Pension:

0.1

1.7

Growth:

0

0

Distribution:

0.1

1.7

Cash (trust)

Superannuation:

0.085

1.4

Pension:

0.1

1.7

Growth:

0

0

Distribution:

0.1

1.7

Australian bonds

Superannuation:

2.13

1.7

Pension:

2.5

2

Growth:

0

0

Distribution:

2.5

2

International bonds

Superannuation:

2.06

1.8

Pension:

2.3

2.1

Growth:

0

0

Distribution:

2.3

2.1

International Equities

Superannuation:

4.6

4.6

Pension:

4.9

5.3

Growth:

3

2.7

Distribution:

1.9

2.6

Emerging Markets Equities

Superannuation:

6.4

7.9

Pension:

6.7

8.9

Growth:

4.5

6.5

Distribution:

2.2

2.4

Listed Australian Property

Superannuation:

4.4

5.6

Pension:

5

6.6

Growth:

1.2

0.5

Distribution:

3.8

6.1

Listed Global Property

(aka Listed International property)

Superannuation:

4.4

5

Pension:

5

5.9

Growth:

1.2

1.8

Distribution:

3.8

4

Infrastructure

Superannuation:

6

5.1

Pension:

6.5

6

Growth:

3

1.8

Distribution:

3.5

4.1

Hedge Fund aggressive

Superannuation:

8.9

5.3

Pension:

10.5

5.9

Growth:

10.5

4.9

Distribution:

0

1

Hedge Fund conservative

Superannuation:

6.4

5.3

Pension:

7.5

5.9

Growth:

7.5

4.9

Distribution:

0

1

Alternative

Superannuation:

4.9

5.2

Pension:

5.7

5.9

Growth:

0.3

3.9

Distribution:

5.4

2

Changes to “Fixed interest=Australian bonds”

Field

Old value %pa

New value %pa

Interest rate

2.5

2

Accumulation phase total return %

2.13

1.7

Pension phase total return %

2.5

2


Changes to “Cash" accounts

For cash returns, the current interest rate is 0.1%, however the long term average is assumed to be 1.7%. So, for cash accounts, we assume that the interest rate is 0.1%, and then increases to 1.7% in 2026/27, since cash accounts are more immediate

Field

Old value %pa

New value %pa

Interest rate

0.1

2021/22 to 2025/26: 0.1

2026/27 onward: 1.7