iscover Super balance not a priority for young Aussies, SMC reports
SuperDespite the long-term benefits of well-managed super, many aren’t motivated or don’t know where to start.
New findings from research house Ideally reveal that more than a third of young Australians check their superannuation balance rarely, some only once a year.
More than one in four can’t name their fund.
The survey, conducted by the Super Members Council (SMC), involved more than 1,300 Australians and found that lack of knowledge and the length of time until retirement were among the reasons.
Managing excessive super fees alone could make a significant difference to an individual's balance at retirement, with an SMC model having shown that simply paying 0.1 per cent more in fees could reduce super savings by $14,000, and paying 1 per cent more could make someone $128,000 worse off by retirement.
Some young Australians were disengaged from their super because retirement felt far away, with 33 per cent of young Australians having said that super didn’t yet feel like their money. In a recent episode of The Lawyers Weekly Show, Veronica Barbetta of UniSuper noted that younger professionals weren’t managing their super to its full potential.
She commented: “The earlier you engage with and think about your superannuation and make active choices, the better your outcome in retirement will be.”
Past research by SMC revealed that those with better super comprehension were six times more likely to take action to improve retirement savings. Currently, 46 per cent of young Australians are interested in being properly educated in super by their fund, according to the latest survey.
Super literacy was also not where it needed to be. SMC CEO Misha Schubert noted that more needed to be done to communicate how to make the most of super.
“Too many Australians risk sleepwalking into retirement with less money than they should have because they haven’t felt confident to engage with their super,” she said.
According to the SMC, one in four workers was not being paid all their super, costing 3.3 million Australians almost $6 billion a year.
Other advice from the survey included consolidating super into one account, thereby avoiding multiple fees, as well as selecting a top-performing super fund and, if possible, making extra contributions. The SMC model showed that an average 30-year-old could have $67,000 more at retirement by sacrificing $20 a week.
Schubert added: “Small differences in super can add up to life-changing sums over time. That’s why staying engaged with your super from when you start working until you retire is so important.”
Amelia is a Professional Services Journalist with Momentum Media, covering Lawyers Weekly, HR Leader, Accountants Daily and Accounting Times. She has a background in technical copy and arts and culture journalism, and enjoys screenwriting in her spare time.
