The Retirement Conversation We Need to Have

Financial Planners

The Australian Retirement and Pension Funds Association (ASFA) states that a married couple needs $690,000 and a single person needs a retirement pension balance of $595,000 to enjoy a comfortable retirement at age 67. Both super account balances assume you own a home and are in relatively good health. The reality for the average Australian is that the superannuation promise is being delivered as it is intended, even though the superannuation security deposit has increased to 10.5% of his wages. Sadly, no.

This was recently reaffirmed by ASFA who reported on the mean and median retirement pension balances for men and women across all age groups. As an example, males aged 18-24 have an average balance of $8,072, while females have an average balance of $6,994. However, between the ages of 50 and her 54, men have an average account balance of $214,795, while women have an average account balance of $157,124. There is also a large $57,794 difference between men and women. And when comparing the average reality with what constitutes a comfortable retirement at retirement age, both balances are still a long way from ASFA’s goals for singles and couples.

After many, many conversations with a first-time client for a while, the client seemed disappointed with his retirement fund. comments such as, “When I spoke to the fund, that person knew nothing about it,” and “I read that it would be beneficial to split contributions with a partner before retirement, but when I spoke with the fund,” I spoke. People couldn’t tell me much about it. with a facial expression. From my own experience, clients are not getting the information they need from super his providers.

I also researched several funds online to see what they were telling their members about their retirement options. I found that there wasn’t much depth out there beyond campaign transfers, salary sacrifices, and the occasional loss of super callouts. We also found a distinct lack of information for account holders.

With thousands of young Australians joining the workforce each year, there are many who miss out on the benefits they could have if they were informed and encouraged to participate in this long-term savings vehicle. has always been raised to abhor waste, so I see this as a wasted opportunity. It’s like handing over your car keys to a young person, but you really don’t have to worry if you know how to drive. Are Superfunds letting their members down when it comes to engagement and education to get the most out of their Superfund? Perhaps the answer for some of them is yes.

If Superfunds don’t have conversations like this with their members, who does? I consider it the responsibility of our profession. We are the next line of defense to help Superfund holders understand their options when it comes to making the most of their retirement options. If Superfunds don’t educate their members, we advise professionals should do so from their first pension account through retirement and beyond. I wish I had.

There are different super strategies that every client should consider.

  • super vehicle strategy
  • Integrated strategy
  • Contribution strategy
  • Contribution catch-up strategy
  • super split strategy
  • Spousal Contribution Strategy
  • Government co-contribution strategy
  • Re-contribution strategy
  • Good super fee strategy
  • Appropriate tax in ultra-strategy
  • Downsizing contribution strategy
  • Retirement pension investment strategy
  • Super estate planning strategy

And that strategy list hasn’t even begun to cover what happens when you retire.

I urge my colleagues not to fall into the trap of thinking they aren’t interested in their supermarket until they’re five years away from retirement.

Soon, and in the next few years, retirement security will rise again. From July 1, 2023 to June 30, 2023, it increases to 11%. It will increase to 11.5% from 1 July 2024 and to 12% from 1 July 2025. These pay increases are important to help Australians live with more dignity and comfort in retirement, but without inherent changes in how Australians are educated about their super, the gap will be closed. is unlikely to be

Luke Smith, Licensed Australian Financial Planner and Author

The Retirement Conversation We Need to Have


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Last updated: May 1, 2023

Publication date: May 1, 2023

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