Report reveals essential contribution of superannuation
Only one-third of Australians believe they would be able to save for their retirement without compulsory superannuation, an AustralianSuper study has revealed.
The report, Superannuation Across Generations, revealed only 32 per cent of Australians believed they could save for retirement without super.
It was found that 33 per cent of Millennials, 32 per cent of Gen X and 19 per cent of Baby Boomers said they would have between zero and $10,000 saved.
Fifteen per cent of Australians said they would have no retirement savings without superannuation.
According to the report, saving enough to retire comfortably which is usually around $595,000, would be a significant challenge for many.
AustralianSuper chief member officer Rose Kerlin said superannuation had become the “bedrock” of retirement savings for Australians, regardless of their generation.
“Australia’s retirement system is one of the best in the world and this hasn’t gone unnoticed,” Kerlin said.
“The Superannuation Across Generations survey reveals Australians not only highly value the system but also count on it to live well in retirement.”
“Whether you’re just starting out or nearing retirement, keeping your super locked away until retirement helps you reap the benefits of long-term investment performance.”
It was found that 87 per cent of Australians across all generations saw the benefit of the superannuation system.
Baby Boomers are the biggest supporters of superannuation, measured at 93 per cent, followed by Gen Z at 89 per cent.
The Silent Generation was measured at 87 per cent, Gen X at 84 per cent and Millennials at 83 per cent.
All generations declared strong support for “one of the best superannuation systems in the world,” according to AustralianSuper.
Kerlin said it was reassuring that Australians understand and appreciate how super can significantly benefit them.
“Gen Z, who are amongst the strongest supporters, have the most to gain,” she said.
“With up to three-quarters of their super balance made up of compound returns at retirement, Gen Z will benefit from a 12 per cent super guarantee rate for most of their working life, which will help supercharge their balances.”
The survey also highlighted that one in two Australians believed that super would be their main source of retirement income.
Fifty-eight per cent recognised that their super was their largest or second-largest financial asset.
In addition, Australians were more engaged with their superannuation than in the past, with more than a third having checked their super once a month.
Though Australians said they checked their super balance, many also said they have never made a year-on-year comparison, which AustralianSuper recommends doing.
Kerlin said this was an important step in ensuring the security and growth of one of the largest financial assets an individual would have in their lifetime.
“Superannuation is often one of the largest financial assets people have outside of their home and regularly reviewing how much you’re paying in fees, just like you would with your utilities or insurance, can have a big impact on your retirement outcome,” Kerlin said.
“Whatever your path, it pays to do a few small checks that can have a big impact on your retirement.”
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