Decimal’s latest report has revealed that clients under the age of 35 had an increased engagement of 82 per cent in the last quarter. The software firm works with banks, super funds and administrators to deliver advice to clients.
In what Decimal considers a "massive" increase, Millennials have increased their requests for statements of advice by 82 per cent.
Commenting on the findings, Decimal said: “We’re consistently reading about how disengaged Millennials are with their super.
“Yet, when we look into usage of Decimal’s digital advice technology among those under-35s, we see a different picture.”
Millennials made up 22 per cent of all statements of advice delivered in the last quarter but only 19 per cent of Decimal’s client base.
People between 56 and 65 also increased their engagement, with requested statements of advice increasing by 75 per cent.
When it came to the advice clients were requesting, advice on investment choice was by far the most sought after, followed by super contributions, insurance needs, insurance cover and pension investment choice.
Super funds are actively trying to reach this younger audience, using chatbots and virtual specialists.
According to Mercer, Millennials’ poor engagement is because retirement is too abstract a concept, or simply too far away.
Mercer chief customer officer for the Pacific, Campell Holt said that 80 per cent of Australians don’t seek out financial advice, and that the barrier for Millennials was just language.
“If the industry wants Millennials to engage with their superannuation and retirement strategies we need to speak their language across the media they relate to.
“We need to deliver an experience that demystifies superannuation and empowers customers to engage and interact with super on their own terms, anytime and on any device.”
A Roy Morgan report late last year argued that Millennials' lower super balances are the result of shorter-term priorities like housing affordability.
Despite having increased their share of super fund balances since 2007, Australia’s – and especially Sydney and Melbourne’s – surging house prices have seen Millennials focus their attention on cracking the housing market.
Roy Morgan Research’s Norman Morris said: “This research has shown that due to the compulsory nature of superannuation, Millennials, Generation Z and Generation X are where the greatest growth potential now lies.
“It is a major challenge for superannuation funds to engage the younger generations in a long-term issue such as superannuation, when they are most likely to have shorter-term priorities such as housing affordability and lifestyle,” he continued.
Further, the changing rules governing superannuation and the difficulty of accessing funds have also turned off younger Australians.
Speaking last year, Financial Services Council CEO Sally Loane warned that the economic ramifications of Millennials’ disengagement are dire.
She said it will mean a greater emphasis on government contributions.
“In other words, the more we allow – and indeed condone – apathy and disengagement, the worse off young people will be at the end of their working life, and so will we, the taxpayer.”
However, she said the idea that Millennials are uninterested in savings is inaccurate, pointing to the fact that the housing market is inaccessible, wage growth sluggish and interest rates on savings low.
“This generation understands all too well the importance of money and growing wealth over the long term,” she said.
“Getting Millennials interested in super will lead to greater financial competencies and more effective financial decision-making; consumers better able to choose a super fund suited to their personal circumstances; reduction of lost and multiple accounts; and a cohort better able to self-fund their retirements.”