Retirement
Will climate change ruin your superannuation?
Climate change will take tens of thousands of dollars away from today’s youth, as the world grapples with employment issues and natural disasters, new research has warned.
Will climate change ruin your superannuation?
Climate change will take tens of thousands of dollars away from today’s youth, as the world grapples with employment issues and natural disasters, new research has warned.

The study, from Actuaries Institute, has indicated that climate change could result in lower superannuation contributions due to an increase in underemployment and unemployment as nations transition to a zero emissions world.
The increasing occurrence of natural disasters due to climate change is also expected to see members receiving lower lifetime returns, according to the findings.
For Actuaries Institute’s president, Nicolette Rubinsztein, “many Australians understand the physical risks posed by climate change, but few appreciate the impact it could have on their mortality risks and their retirement savings”.
In a scenario where a superannuation member was unemployed for one year in 10, they would be 11 per cent worse off by the time they reach retirement, it was highlighted.

The findings considered that a member on $75,000 a year for nine out of 10 years with returns on their super of 4.80 per cent would lose $41,000 as their balance falls from $382,000 to $341,000.
If a superannuation member with the same salary sees a fall in returns by just 1 per cent, the superannuation member would lose 18 per cent over their lifetime.
Under this situation, the member would retire with $313,000 instead of the $382,000 as expected today.
Impact on the government
The flow-on effect of lower superannuation returns will also hit the government hard, with low accumulation of savings for retirees meaning more people will be eligible for the pension.
The expected age pension expenditure on the median earner is estimated to be $20,000 to $30,000, assuming current levels of population mortality.
“There may be a greater reliance on the Age Pension if climate change seriously diminishes superannuation balances, and a higher cost of provisioning for future Age Pension liabilities if investment returns are lower,” Actuaries Institute concluded in its report.
About the author

About the author


Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more

Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more

Superannuation
Aware Super slashes admin fees for retirees by up to 25 per cent
Aware Super has reduced administration fees for members with a retirement income account by up to 25 per cent and lowered the maximum annual fee. Read more

Superannuation
SuperAPI co-founder criticises Labor's superannuation tax as 'sneaky tax on young people'
The co-founder of SuperAPI has labelled Labor's proposed tax on superannuation balances above $3 million as a "sneaky tax on young people, tomorrow" disguised as a policy targeting wealthy retirees ...Read more

Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more

Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more

Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more

Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more

Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more

Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more

Superannuation
Aware Super slashes admin fees for retirees by up to 25 per cent
Aware Super has reduced administration fees for members with a retirement income account by up to 25 per cent and lowered the maximum annual fee. Read more

Superannuation
SuperAPI co-founder criticises Labor's superannuation tax as 'sneaky tax on young people'
The co-founder of SuperAPI has labelled Labor's proposed tax on superannuation balances above $3 million as a "sneaky tax on young people, tomorrow" disguised as a policy targeting wealthy retirees ...Read more

Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more

Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more

Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more

Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more