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Australians unprepared for negative super
By Benjamin Levy
Nearly 40 per cent of Australians believe that movements on the share market have little or no impact on their superannuation returns.
Global consulting and investment firm Mercer released this information in a survey today, with its Asia Pacific leader of outsourcing, David Anderson, calling the results “alarming”.
“There is an alarming level of disengagement from super if Australians think there is no relationship between stock market volatility and their super account balance,” he said.
Nearly half of all people surveyed by Mercer have made little or no preparations for retirement, while 72 per cent of people surveyed expected their super return would be higher on their next statement.
Anderson said many Australians did not connect the dots between share market performance and their super savings.
“The ASX200 performance dropped 13.4 per cent in the year ending June 2008… there is clearly a wake-up call about to sound for many Australians – around half of which say they’re relying on their super to finance a comfortable lifestyle in retirement.”
However, in keeping with the reassurances from the super industry, Anderson said that there was no need to panic about the negative short-term performance of superannuation returns.
“All is far from lost, though. Superannuation for most people is about long-term investment.”
Mercer said that the results could be the tip of the iceberg in terms of how apathetic younger Australians are about their superannuation.
“The Government has committed to making superannuation and financial advice simpler and more accessible. The challenge now is how to connect with younger Australians and positively influence their retirement savings habits,” Anderson said.
17 July 2008
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