Retirement
Majority of Australians still unsure about their retirement prospects
Retirement
Majority of Australians still unsure about their retirement prospects
A recent survey conducted by MFS Investment Management® has shed light on the ongoing uncertainty faced by many Australians regarding their retirement plans. Despite a slight increase in confidence compared to the previous year, a significant portion of Australians remain unsure about their ability to retire comfortably.
Majority of Australians still unsure about their retirement prospects
A recent survey conducted by MFS Investment Management® has shed light on the ongoing uncertainty faced by many Australians regarding their retirement plans. Despite a slight increase in confidence compared to the previous year, a significant portion of Australians remain unsure about their ability to retire comfortably.
The 2025 MFS Global Retirement Survey, which included 700 Australian retirement plan members and over 300 retirees from Australia, Canada, the United States, and the United Kingdom, revealed that only 39% of Australian superannuation members felt "very or extremely confident" about retiring at their desired age. Among retirees, just 45% expressed confidence that their assets would provide sufficient cashflow throughout retirement.
The survey results highlight a persistent concern among Australians, as a growing number of individuals express doubts about their retirement prospects. Notably, 38% of members now believe they will not be able to retire, up from 28% last year. Additionally, 64% expect to work longer than initially planned, marking a four-percentage-point increase from the previous year.
Josh Barton, senior managing director and head of Australia and New Zealand at MFS Investment Management, commented on these findings, stating, "While it's natural for financial concerns to prompt adjustments, it's crucial for investors to stay focused on long-term goals. Remaining invested over the long term allows members to benefit from compounding returns and ride out market fluctuations, ultimately helping secure a more stable retirement."
The survey also revealed that three-quarters of super fund members acknowledged the need to save more for retirement than originally planned. This reinforces the notion that saving for the future remains a leading financial concern for many Australians. Housing costs have now surpassed day-to-day living expenses as the top financial worry, closely followed by the impact of inflation on purchasing power. In response, 33% of members adjusted their retirement investments over the past year, up from 25% in 2024.
Despite the prevailing uncertainty, Australians continue to rely on various resources for retirement planning. Super funds remain the most relied-upon source of advice, with 54% of participants turning to them. Additionally, Australians seek guidance from financial planners, the financial media, online investment services, and family members and friends. Peers and coworkers also play a role in helping individuals make retirement planning decisions.
The survey also highlighted a growing enthusiasm for Environmental, Social, and Governance (ESG) options within super funds. Despite low confidence in retirement readiness, an increasing number of Australians are seeking more ESG investment options in their retirement plans. An impressive 81% expressed interest in ESG options, up from 73% in 2024. Gen Zers were particularly enthusiastic, with interest rising from 75% last year to 97%. Millennials also showed increased interest, rising from 78% to 90%, while Boomers' interest climbed from 62% to 73%. However, Gen X bucked the trend, with interest slightly declining from 71% to 68%.
In light of these findings, Barton noted, "It's encouraging to see conviction improve among members and retirees, yet our study shows that most Australians remain unsure about their journey, and that despite higher mandated and incentivised contributions, cost-of-living pressures continue to weigh heavily on members."
He added, "Younger generations seeking advice earlier and adopting digital tools is a positive sign for improving retirement confidence and creating a smoother retirement journey, especially as high-quality advice models and digital innovations come together."
As Australians navigate the complexities of retirement planning, the survey underscores the importance of staying informed and making strategic adjustments to secure a more stable financial future.
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