Lump sum mentality still a factor
Australia's superannuation lump sum mentality may be changing but it is still a significant factor, according to the latest superannuation data released by the Australian Prudential Regulation Authority (APRA).
The data revealed that while an increasing number of retirees are opting to take pensions, lump sums still represent slightly more than half of the benefit payments being taken by Australians.
In the September quarter, lump sum benefit payments ($8.3 billion) were 49.1 per cent and pension benefit payments ($8.6 billion) were 50.9 per cent of total benefit payments, while for the 12 months ending September 2016, lump sum benefit payments ($33.0 billion) were 50.2 per cent and pension payments ($32.7 billion) were 49.8 per cent of total benefit payments.
Industry commentators have urged caution on interpreting the lump sum data on the basis that many retirees do not have sufficient funds at retirement to make the taking of a pension a viable option.
The APRA data also revealed that the key differentiator between industry and retail superannuation funds was infrastructure investment.
The data revealed industry funds had the largest exposures to infrastructure at around seven per cent, compared to barely two per cent for retail funds.
Recommended for you
With just 30 per cent of Australians knowing their superannuation balance to the nearest $1,000, Findex has emphasised the role of financial advice in addressing the critical super knowledge gap.
Underestimating the cost of insurance by almost $75,000 in a Statement of Advice is among multiple reasons that a relevant provider has faced action from the FSCP.
Financial Services Council chief executive, Blake Briggs, is urging Minister for Financial Services, Stephen Jones, to take advantage of the QAR opportunity to reduce regulatory duplication and ensure advice is affordable.
Former chair of the House of Representatives’ Standing Economics Committee, Tim Wilson, is planning a return to politics after losing his seat in the 2022 federal election.