Extra super contributions – all talk, no action

Ross Bowden

While most Australians agree on the benefits of having 12 per cent superannuation deductions, most will not act on this sentiment, according to research conducted by ING Australia.

According to the research, 83 per cent of respondents said they wanted to greater control over their super and 56 per cent considered salary sacrificing to increase their super contributions to 12 per cent of salary. However, only 39 per cent said they would use their income tax cuts towards super.

ING executive director of employee super Ross Bowden said that despite the willingness of members to consider additional super contributions, very few actually followed through.

“Our own modelling shows that an extra 3 per cent contribution on low balance account super can add at least $130,000 to the final super benefit,” he said.

“Another additional benefit of increased super contributions is the potential for a significant reduction in fees.”

Bowden said the 9 per cent superannuation guarantee did not provide enough for a comfortable retirement.

“The community, government and superannuation funds all agree that further contributions are beneficial and lead to substantially larger sums for retirement,” Bowden said.

“At ING we support the implementation of soft compulsion as a positive step for Australians to increase their super contributions and fund a better retirement.”