Savings outside super ‘inevitable’, says Austock

In a statement, Austock Life said the main tenet of this year's budget is that savings outside super will be encouraged as "the third pillar' of Australia's retirement incomes system, creating a "new super" world of uncertainty.

"The 2016 budget, and whatever the outcome of July's 2016 federal election, inevitably points to a major redesign of super concessions aimed at lessening their attraction to higher income and wealthier clients," the statement said.

"The government and opposition seem on parallel policy paths to peel back the superannuation system to fit so proffered new policy objectives of super.

"These objectives draw heavily on last year's Financial System Inquiry report and at their core have the notion that 'new super' is for building only a moderate, and not necessarily comfortable, retirement nest-egg."

Austock Life managing director Ross Higgins suggests that insurance bonds are the next best tax-effective investment framework to superannuation, noting that they are another approach to "life-events" financial planning.

"Insurance bonds will be at the forefront of the alternatives because they offer completely uncapped contribution limits for lump sum investments, and without constraints on their growth," he said.

Mr Higgins noted that other advantages of insurance bonds include unrestricted access, along with attractive and progressively increasing contribution caps for ongoing additional contributions under the 125 per cent rule.

He added that insurance bonds are versatile tools for estate planning and making intergenerational wealth transfers that can be flexibly structured as estate and/or 'protected' non-estate arrangements.