ISA: super is for retirement

Australians believe the purpose of super is to provide financial security in retirement, according to the recent research by Industry Super Australia (ISA).

Although 80% of surveyed Australians agreed this was a main purpose of super, two thirds also said they believed super should only be accessed before retirement age in cases of extreme hardship – only 12% disagreed, as according to the March UMR survey.

And 70% of respondents said a big goal of the super system should be ensuring that fewer people rely on the pension.

Further to that, ISA said that if super’s purpose was written into law, it may have prevented the previous government from the disastrous early release of super policy during the COVID economic downturn.

The analysis showed that a 30-year-old who took out $20,000 during Covid could be up to $80,000 worse off at retirement and the scheme also increased the taxpayer funded age pension burden, with every $1 taken out of super resulting in an up to extra $2.50 added to future pension costs.

According to the ISA’s study, super should only be for retirement other than in circumstances that match the existing hardship provisions – cases of extreme financial hardship or to pay for life saving medical treatment.

“Having super’s purpose in our law will safeguard members money for generations to come and stop governments repeating disasters like the early release of super scheme – which is proving to be a type of economic long Covid, causing super balances to dwindle and heaping further pressure on the age pension,” ISA chief executive, Bernie Dean, said.

“Politicians that want to bust open super for political purposes should know that community opinion is against them and won’t take too kindly to their savings being undermined.”