A recent article published in The Sydney Morning Herald (12 October 2017) was startlingly entitled “Counting on your super to fund your retirement? Don’t.”
Now, anybody who read that headline would be well within their rights to be alarmed. After all, isn’t the whole idea of super essentially to fund our retirements? The article made some interesting points but also made some questionable assertions. What it did bring home, unintentionally perhaps, is the importance of being intimately acquainted with your super. More on that later.
As a nation, due to mandatory super contributions, we punch well above our weight in investment circles – as the article says “Australians make up barely 0.3% of the world’s population yet hold $2.1 trillion in pension savings – the world’s fourth-largest such pool”. With all that pooled wealth, you’d expect that our retirements would be looking rosy, right? Unfortunately, many people holding super accounts seem to have adopted the old-school Ocker attitude “she’ll be right”. Super is viewed as money that largely can’t be accessed until retirement age so there’s no point in paying it too much attention.