Super no silver bullet for home buyers
Home buyers are being warned against dipping into the superannuation to fund the purchase of a house.
Australian Institute of Superannuation Trustees chief executive, Tom Garcia, called for the Financial System Inquiry in its final report to urge both sides of politics to support moves to enshrine the key objectives of superannuation.
"The purpose of superannuation is to enable all Australians to have enough money for a dignified retirement," he said.
"It is a key plank of the nation's retirement incomes policy and should never be used for any other purpose than helping people save for their retirement.
"Even when the superannuation contribution rate eventually reaches 12%, most young Australians will need every cent of their superannuation to achieve adequate levels of income in retirement."
Garcia warned that enabling people to dipping into their super savings to buy a property could negatively impact their retirements and increase reliance on the Age Pension.
"Removing even relatively small amounts of savings from the superannuation system would see many more Australians reliant on the Age Pension and significantly worse off in retirement," Garcia said.
"Critically, they would miss out on the benefits of compounding interest and portfolio diversification."
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