Young Australians are the only age group intending to invest more in the next three months, indicating that age may not be a factor in financial savviness, the latest MLC Wealth Behaviour Survey reveals.
Released today, the quarterly survey of over 2,000 Australians found that while middle-aged Australians are broadly ’neutral’ and older Australians are cutting back on investing, it’s those aged between 18-29 who are planning to invest more. Not only this, but more young Australians (45 per cent) added to their savings than any other age group in the last three months.
Paul Carter, Executive General Manager, Superannuation and Investment Platforms suggests that while it’s good to see young people focusing on finances, the all important superannuation focus is still missing.
”While young people are the only group intending to invest more in the next three months, it isn’t into super. The question is, why? When arguably the younger you invest the greater the dividend you will receive once you retire.
“The findings show that young people along with women are the group least inclined to top up their super when they can. With one in two Australians telling us that they don’t think they’ll have enough to retire on, it’s important for everyone in any age bracket to be reviewing their superannuation position.”
Today, in conjunction with the research NAB is announcing a new initiative to help motivate young people to assess their superannuation position. SuperSizer is a free online platform targeting young Australians, which allows users to review how their super ‘sizes up’ by comparing their current super position with that of their peer group at a similar age and pay bracket.
The data is provided by Roy Morgan research, who interviewed 34,000 Australians aged 18 and over with superannuation, for the 12 months to March 2016.
“Engaging young people is an important step to helping more Australians save for their retirement. SuperSizer engages the competitive nature of our Gen Y’s, and will help to educate those who haven’t given a second thought to their super since signing up to whichever fund their employer provides,” explained Mr Carter.
Lara Bourguignon, General Manager of Corporate Superannuation says that industry needs to do their part to help educate young Australian investors around superannuation.
“Our research found that two-thirds of young Australians holding multiple super accounts are thinking about consolidating them yet haven’t done so. The simple act of reviewing one’s superannuation position and consolidating funds can mean big rewards in the long run, and we need to provide the education and tools to make this process as simple as possible for young Australians.”
“The fact is a small amount of time and energy now can mean thousands of dollars difference when it comes to retirement age. We’re hoping that young people who are behind the eight ball compared to their peers will take action once that figure is staring back at them, and do something to change it,” explained Mrs Bourguignon.
Additional findings include:
Women continue to fall well short of men when it comes to how much they think will have to retire on. Around 57% don’t expect to have enough (45% of men) and 27% far from enough (19% of men).
We expect to retire with $516,000 in savings (net of our homes). But we think we will need $755,000 at retirement - a gap of $239,000. Women ($262,000) anticipate a bigger shortfall than men ($219,000).
For those holding multiple superannuation accounts, around 57% are thinking about consolidating them into a single account.
By age, some two-thirds of young Australians are thinking about consolidating their super accounts, compared to just 35% of over 50s.
In net terms, around 60% of Australians are aware of how much super they have and 53% consider their super to be an important part of their investment strategy for retirement.
Around 58% of us don’t have a financial plan.
About the MLC Quarterly Australian Wealth Behaviour Survey
The MLC Quarterly Australian Wealth Behaviour Survey interviews more than 2,100 people each quarter. It aims to assess the investment environment by asking questions related to current financial situation, investment intentions, level of concern related to superannuation and other investments, change in life insurance, and distance to retirement and investment strategy.