Retirement
MPs backbenching super plans could have $250k consequences
The push by some politicians to cut the planned super increase to 12 per cent could see Australian families standing to lose nearly $250,000 in retirement savings, new analysis from Industry Super Australia shows.
MPs backbenching super plans could have $250k consequences
The push by some politicians to cut the planned super increase to 12 per cent could see Australian families standing to lose nearly $250,000 in retirement savings, new analysis from Industry Super Australia shows.
In a statement from the collective industry fund organisation, it voiced concern over the potential for the removal of an increase to the super guarantee from the current 9.5 per cent level.
It noted some federal backbenchers as wanting the government to cut the promised increase to super contributions, and considered it as “breaking a key election promise and denying local families the retirement savings they are entitled to”.
To support its concern, it cited new analysis that showed “if the super guarantee was frozen at its current rate of 9.5 per cent, a 30-year-old male earning $85,000 a year would stand to lose $147,000 from their super by the time they retire”.
It also reported that a 30-year-old woman earning $85,000 a year who takes time out of the workforce to have children could lose up to $93,000 from her nest egg if the contribution rate does not increase.
“For a local family, by the time they reach retirement, they could lose $240,000 in retirement savings,” the statement said.
Commenting on the political pressure being placed on legislated incremental increases to the super fund guarantee, Industry super Australia’s chief executive, Bernie Dean, said that “cutting the super increase will cost families around the country hundreds of thousands of dollars in retirement savings”.
He said that “Australians will be left struggling to make ends meet in retirement, or will be forced to work until they drop before they can retire”.
“If the government breaks its promise on super, everyone loses,” Mr Dean said.
“The Morrison government needs to reassure Australians that their retirement savings aren’t at risk.”
Industry Super Australia also cited its own research which showed an “overwhelming” majority of Australians – close to 90 per cent – support an increase in super contributions above the current rate.
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