Investment adviser Peter Hensley says the narrow range of savings products helped contribute to the "influx of funds into the non-bank sector" that ultimately led to the collapse of more than 50 finance companies.

"The investment advice industry needs to prepare itself for the pending retirement of the baby boomers," Hensley said in a discussion paper he wrote on retirement income streams. "Those advisers specialising in building cost effective diversified income biased portfolios realise that our limited investment market simply does not have enough suitable retail products to satisfy demand."

The country's ageing population has dominated headlines in recent weeks after former National Party leader and Reserve Bank Governor Don Brash raised the need for the country to address the cost of pension for the baby boomer generation.

The main challenges for both DIY investors and professional advisers are finding the right investment vehicles at the appropriate risk level, in the right quantity, Hensley said.

"Some patient investors recognise the need to start early and are prepared to build their portfolio over time. Experience has shown that it can take up to five years to select a range of suitable risk-related investments to generate a level of income expected," he said.

Hensley supports the use of a collective investment vehicle to promote retirement savings, though these should meet the minimum requirements set by the government-mandated KiwiSaver scheme.