50% of Aussies to be self-funded in retirement by 2050
Half of all Australians will be self-funded in their retirement by 2050, according to the Association of Superannuation Funds of Australia (ASFA).
Pointing to the Government’s Intergenerational Report, the association said Australians would be looking to their super to do the heavy lifting for retirees who faced higher medical and aged care costs in the coming decades.
The report projected government expenditure on health and aged care to increased from a combined 5.3% of gross domestic product (GDP) in 2019-20 to 8.3% in 2060-61.
ASFA said the report noted that with the superannuation guarantee (SG) rising to 12% and more workers contributing to super for longer, the median super balanced at retirement would increase from $125,000 to over $460000 by 2060.
ASFA chief executive, Dr Martin Fahy, said: "With more Australian retirees having higher super balances, the proportion of retirees reliant on the Age Pension will decline and ASFA expects half of all Australians to be self-funded in their retirement by 2050.
"Our strong superannuation system will allow Australia to lower the burden of the Age Pension from the current 2.7% of GDP to 2.1% in 2060-61 making it the lowest among our OECD peers.”
Recommended for you
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
The second tranche of DBFO reforms has received strong support from superannuation funds and insurers, with a new class of advisers aimed to support Australians with their retirement planning.
