Today, ASIC released regulations that allow super and retirement calculators to allow for increases in community living standards. Our previous post on this topic noted that ASIC had mandated using a 2.5% p.a. discount rate to convert future dollars to today's dollars, with a time-limited exemption for super and retirement calculators. Since then the exemption was extended twice, but we now have certainty about how we present today's dollar amounts.
We allow our clients to use inflation rates that are consistent with the default investment returns. The additional factor over price inflation that allows for increases in community living standards is usually between 1% and 1.5%.
No changes are required for the Retirement Income Simulator because it already allows for increases in community living standards, and discloses this.