Balancing super and the age pension
Australia needs to move from a situation where superannuation supports the age pension to one where the age pension supports superannuation, according to the Institute of Actuaries of Australia.
The institute, which is holding a policy forum dealing with superannuation today in Sydney, noted that the transition to a mature superannuation guarantee system would shift the super/pension balance.
But it said the age pension would continue to be an important source of income for median income earners and average income workers.
“It will also support the retirement income of higher income earners during the transition to a mature retirement income system,” the institute said.
The convenor of the institute’s superannuation and employee benefits practice committee, Andrew Boal, said the industry had to do more to help people make key decisions — such as how much to save for retirement.
“We need to improve member awareness about adequacy, including how their superannuation interacts with the age pension,” he said. “To do this, we can use tools like annual projection statements and online calculators to educate them about whether or not they are on track to meet their retirement expectations.
AUTHOR
Mike Taylor
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