Wednesday, 9 February 2022

Finance Contracts - Retirement Villages The Most Complicated

 In a stinging critique Michael West Media exposes retirement village contracts as -

"the most complicated finance contracts in Australia"

The article exposes these contracts as "So devilishly complicated are retirement village contracts that an actuary and lecturer in applied finance, someone at the very pinnacle of mathematics and structured finance, reckons they are harder to understand than even synthetic collateralised debt obligations (CDOs)." 

The video below shows these retirement village contracts, which can stretch up to 500 pages, bewildered all but one of 20 university-educated, retiree-aged subjects in a 2020 study into the financial literacy of consumers looking to enter into retirement village contracts.

Retirement Village contracts - "the most complicated finance contracts in Australia"

The full article can be read here - https://www.michaelwest.com.au/retirement-villages-the-most-complicated-finance-contracts-in-australia/ 

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Function of Government

The role of government is to create an environment for commerce to function whilst at the same time protecting retirees and particularly vulnerable retirees from both financial and emotional harm emanating from that function.

The Victorian Retirement Villages Act 1986 provides the environment for commerce to function but fails to fully protect retirees from financial and emotional harm as a result of it.

The Victorian legislative definition of a retirement village in demanding the payment of an 'in-going' amount without the transfer of property ownership is a major contributor to that financial and emotional harm suffered by retirees.


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