Most Australians still outliving their super
Most Australians are not out-living their superannuation, according to new research released by the Association of Superannuation Funds of Australia (ASFA).
The research, released during ASFA’s annual conference in Adelaide, has found that while the proportion of people aged over 65 with superannuation has increased in recent years, the great bulk of people continue to die with little or no superannuation.
It found that only 37% of individuals aged 75 to 79 have any superannuation, while only 20% aged 80 to 85 still have superannuation.
ASFA acting chief executive, Leeanne Turner said that the research confirmed that not having enough superannuation in retirement represented a much greater challenge that the relatively few older individuals not spending all their superannuation during their lifetimes.
The ASFA research also honed in on the lingering costs of the former Coalition Government’s COVID-19 hardship early superannuation release program which allowed people to withdraw up to $10,000 from their balance.
It said that for a person aged about 30 when they applied for the COVID-19 early release, the impact on their final retirement superannuation balance in many cases would be over $43,000 in today’s dollars.
Other key findings include:
- The gender gap in superannuation has been narrowing, but there remains a 25 per cent gap in the median balance of women and men in the runup to retirement. Policy measures advocated by ASFA such as the Superannuation Guarantee (SG) on Paid Parental Leave (PPL), a superannuation baby bonus, and an increase in the upper threshold for LISTO aim to address this issue
- ASFA analysis of Census data suggests that currently each year around 45,000 Australians aged 60 to 64 retire, around 65,000 aged 65 to 69 retire and around 40,000 aged 70 to 74 retire.
- In 2021-22 (for funds with more than six members) there were around 1,370,000 persons who received regular income from account-based income streams. There were 99,000 persons receiving annuity payments (both term and lifetime) along with 159,000 persons receiving defined benefit pensions.
- The number of unjustified multiple superannuation accounts has substantially decreased in recent years with the number of unwanted or unnecessary accounts in the system in the order of 2 million to 2.5 million. “Stapling” of superannuation accounts to an individual when they change jobs is helping to control the creation of new multiple accounts but has no impact on the existing stock of multiple accounts.
- ATO sample file data indicates that for those with more than $3 million in superannuation as at June 2021 around 60 per cent were male and around 85 per cent were aged 60 and over. Around one-third had an investment property. Less than 1 per cent recorded farm income in their tax return.