Retirement
Working Aussies fearful of retirement
Many Australians are worried about their retirement prospects, but a small increase in super contribution is helping Australians sleep at night, new research has found.
Working Aussies fearful of retirement
Many Australians are worried about their retirement prospects, but a small increase in super contribution is helping Australians sleep at night, new research has found.
According to Investment Trends’ latest Retirement Income Report, fewer than half of working Australians aged 40 or above believe they are prepared for retirement.
King Loong Choi, senior analyst at Investment Trends, said a small salary sacrifice makes Aussies go from pessimistic to optimistic about future retirement.
“Australians who believe they will live comfortably in retirement typically contribute 11 per cent of their annual household income into their super fund, meaning that an additional contribution of 1.5 per cent p.a. above the super guarantee level (of 9.5 per cent) contributes significantly to their peace of mind.”
“Even among lower-income households, a slight increase in super contribution levels corresponds with greater confidence in retirement outcomes,” Mr Choi explained.
The report also found that despite being restless about their future, the majority of non-retirees are not seeking out information that could help improve their situation.
Currently, super funds are the most frequent point of contact for those seeking information on retirement, but with only half saying their info needs were sufficiently met, there is room to improve both the accessibility and relevance of content,” Mr Choi said.
The research analyst believes linking Australians to more information about their superannuation is critical to helping them succeed.
“It is crucial that relevant retirement information is easy to find, as those who successfully find the information they need are highly likely to take further action – almost 90 per cent of them. And the actions these people take are important ones, most often preparing a will, seeking financial advice and making voluntary super contributions,” Mr Choi said.
Not only is access having a benefit to members, it is helping superannuation funds, Investment Trends suggested.
“Our research also reveals that Australians who were successful in seeking information from their super fund were more likely to engage with their fund, stay with their fund and consolidate other super monies to their fund,” Mr Choi concluded.
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