Uncertainty dominates super savings

Australians are becoming increasingly uncertain about their financial preparations for retirement, the latest nationwide survey into consumer knowledge and attitudes towards superannuation has revealed.

The annual Super Fitness Survey, commissioned byMLCandVanguardjoint venture companyPlum Financial Services, found nearly 60 per cent of Australians feel they are financially unprepared for retirement.

The result, a four per cent jump on the number of people who were in doubt about their financial preparations for retirement last year, was buttressed by continuing confusion about superannuation and the issues surrounding retirement savings in Australia.

The survey found 63 per cent of individuals were completely unaware of even the rate at which their superannuation, allocated pension or deferred annuity performed over the last 12 months, while 44 per cent did not know in which asset classes their superannuation was invested.

The survey also found two thirds of individuals had no idea that superannuation savings attracted taxation at three different levels and that 38 per cent felt it was more important to review their mortgage rather than their superannuation.

Plum general manager of market and member development Sara Daymond says the survey findings highlight the need for a heightened focus on creating awareness about retirement planning across Australia.

“Education is the key to encouraging Australians to take an active interest in managing their superannuation and control of their lifestyle in retirement,” she says.

“In our experience, once individuals are equipped with the basics about superannuation and investing, they have the foundation to help them take control of their financial future.”

The survey found almost half of those surveyed were keen to learn more about superannuation and one third would take a greater interest in superannuation if it were made simpler to understand.

However, the survey also revealed that a growing number of individuals felt they were being placed increasingly in the dark about superannuation, with up to 51 per cent of respondents indicating information about superannuation was too difficult to understand - an 11 per cent jump on the previous Super Fitness Survey.

“The fact that Australians’ knowledge of superannuation and investment concepts continues to remain poor is a serious social issue given that most Australians feel financially unprepared for retirement,” Daymond says.

“What our survey clearly shows is the need for more action. People should be encouraged to educate themselves, do more to plan and save for their future - after all, it is the responsibility of every individual to put themselves in a financial position for retirement.”