iscoverAustralia’s retirement system and its growing complexities could rob a new retiree of up to $136,000 over the course of their retirement, according to newly released data.
‘The silver tsunami’: SMC calls for super system reforms
03 November 2025
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8 minute read
A recent report produced by the Super Members Council (SMC) has revealed that a typical new retiree could miss out on $6,500 a year over the course of their retirement simply based on the complexity of the system.
According to the report, Retirement revolution: Simpler smarter retirement, the “complexity and rigidity” of Australia’s retirement system was laid out and ruled as a “barrier to a simple and seamless transition into retirement for many Australians”.
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It was also unveiled around 700,000 Australians aged over 65 who were not working full-time and still had their super sitting in taxed savings-phase super accounts, which had the impact of lowering their disposable income in retirement.
The peak super body said the modelling highlighted fresh urgency for the need to fast-track long-awaited financial advice reforms and design simpler, smarter pathways into retirement, which were easier for everyday Australians to navigate.
“A ‘silver tsunami’ of 2.8 million Australians is now racing towards retirement in the coming decade. This demographic influx will double the number of Australians retiring each year from 150,000 to 300,000,” the council said.
“And the amount of money these retirees will have in super by age 65 will almost double, too, rising from around $750 billion over the past decade, to almost $1.5 trillion over the next.”
To combat the “silver tsunami”, the council is calling for urgent short-term reforms to prepare the super system, including expanding access to simple, affordable financial advice and digital tools, enabling safe and effective data sharing with the government to enable funds to optimise incomes and offer retirement income dashboards to their members.
The body also called for supporting Smart Retirement Pathways and suggested the best retirement income solution for them, preservation of flexibility and retiree choice, and fixing issues that lead to dual super accounts for retirees.
The SMC said reform must be taken seriously and put into action, as in 2024–25, around 64 per cent of tax-free retirement account holders withdrew above the minimum, as well as 77 per cent of those with less than $50,000 in super.
Misha Schubert, chief executive of the SMC, said the report dispelled a persistent myth that most Australian retirees were understanding their super, showing drawdowns from super were now typically higher than the minimum amounts required.
“We need to make the shift into retirement so much simpler, easier and more intuitive for everyday Australians. This challenge is now incredibly urgent as almost 3 million Australians start to race towards retirement in coming years,” she said.
“Moving to a system of simpler, smarter pathways into retirement would mean every Australian could retire with confidence, knowing they’re not missing out on money to pay the bills and enjoy life to the fullest.”
Other longer-term reforms suggested by the SMC included simplifying a transition to tax-free income, rethinking minimum drawdown requirements for Australians with low super balances so poorer retirees could access the benefits of moving into the tax-free retirement phase and strengthening consumer protection by applying a quality filter on all retirement products.
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