Term deposits preferred over super
Term deposits, property, and holidays take the cake when it comes to investor windfall, according to BT Financial Group.
BT's financial health index found 40 per cent of Australians would invest in a term deposit or high interest account following a $100,000 windfall. Just over a third said they would invest in property, and the same for a holiday.
However, only one in five would put the money towards superannuation.
BT Financial Group general manager for superannuation, Melinda Howes, said "many people currently nearing retirement are under-funded — they don't have enough super to last their lifetime".
"Investing an inheritance in super in your 50s or 60s could be what makes the difference between a frugal and a comfortable standard of living in retirement," she said.
The index also found over one in four Australians hold shares, and a similar proportion did not have any investments at all.
Property was the most popular investment for those under 45, and 54 per cent of those aged between 25 and 35 said they would buy property.
"Australians are certainly comfortable investing in cash and short-term savings accounts and term deposits, but the truth is, they are unlikely to reach their superannuation goals with these investments alone," Howes said.
Recommended for you
Infrastructure assets are well-positioned to hedge against global uncertainty and can enhance the diversification of traditional portfolios with their evergreen characteristics, an investment chief believes.
Volatility in US markets means currency is becoming a critical decision factor in Australian investors’ ETF selection this year.
Clime Investment Management is overhauling the selection process for its APLs, with managing director Michael Baragwanath describing the threat of a product failure affecting clients as “pure nightmare fuel”.
Global X will expand its ETF range of exchange-traded funds next month with a low-cost Australian equity product as it chases ambitions of becoming a top issuer of ETFs in Australia.
