Most Australians unprepared for retirement

By Jessica Yun

August 29 2017
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A new study of Australians’ attitudes towards retirement has found that two in three pre-retirees feel ill-prepared to leave the workforce.

MLC, NAB, retirement savings, retirement planning, wealth management, pre-retiree, retirement preparedness

The report, conducted by NAB’s wealth management business MLC, found that 66 per cent of those who had yet to retire felt ‘slightly or not at all prepared’ for retirement.

In contrast, only 15 per cent of Australians felt ‘very well or fairly well’ prepared.

MLC general manager of superannuation customer experience Lara Bourguignon said she believed super could be a tool to turn around the “high level of poverty among retirees”.

“While these results are concerning, we want to remind people in this age group that it’s not too late for them to take action and better understand their holistic wealth position as they prepare for retirement,” she said.

According to the report, there was “much uncertainty” surrounding how much would be needed for a self-funded retirement.

“The research findings reveal that only 54 per cent believe that their superannuation will be enough to see them through their retirement,” the report said.

“However, those with financial planners/advisers (76 per cent) and those with accountants (63 per cent) were much more likely to agree that they would rely on their superannuation in retirement.”

This uncertainty may have been the driving force behind additional contributions made to their super in the last 12 months, with 29 per cent of respondents who said they had done so.

Ms Bourguignon said a range of options were available for those looking to retire in a few years to increase the number in their super balance.

“For example, we know some of the people in this age group have other assets such as property in their name beyond super, which is an important factor for them to consider when planning for retirement.

“If they don’t have other assets, engaging with their super fund may prove to be a cost-effective way for them to access advice in lieu of seeing a financial adviser,” she said.

Women were among the least confident in their preparedness, with the report listing “differing work and longevity patterns; time taken out of the workforce to raise children; being likely to re-join the workforce part-time; and having a longer life expectancy as men” as undermining their confidence.

This latest report follows on from similar research published by MLC earlier this month, which highlighted a fall in Australian pre-retiree’s confidence in their savings over the previous 12 months.

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Retirement