One in 10 Aussies unprepared for financial challenge
Most Australians acknowledge the importance of superannuation in achieving financial independence, however one-third of the population feels ill-prepared to navigate unforeseen financial hurdles.
According to the latest Financial Freedom study conducted by MLC, most Aussies are actively working towards improving their financial wellbeing. However, a considerable number still require additional assistance to achieve their financial objectives and plan for their retirement.
MLC says 69% of Australians spend time thinking about having enough money for retirement while 70% have a good understanding of how super can help them reach their financial goals.
Despite this, research revealed that 20% feel slightly prepared to navigate unexpected personal finance challenges, while 11% don't feel prepared at all.
Almost four in five Australians (79%) have a ballpark idea of how much they currently have in their superannuation fund.
Additionally, more than one in 10 people aged 18-42 (13% for 18-27, and 14% for 28-42), and around one in five people aged 43-76 (20% for 43-57, and 16% for 58-76) make additional personal contributions to their super funds, the data found.
Insignia chief distribution officer and head of superannuation Mark Oliver says the research shows Australians understand the value of superannuation and are motivated to improve their financial situation, but they need more assistance to achieve financial freedom.
"While it is broadly understood that superannuation is not a set and forget strategy, the industry has a role to play to empower members to feel confident in their superannuation and overall financial wellbeing," he says.
"With five million Australians at or approaching retirement, super fund members need better access to relevant tools, information, education and advice well before retirement age - waiting until members transition to retirement is simply too late."
Although the Quality of Advice Review (QAR) proposal that aims to give super funds more power to provide advice has been greatly debated by the industry, with some financial advisers believing it will jeopardise the standard of advice provided, Oliver says he is all for it.
"Expanding the personal advice offer that superannuation funds are able to provide to their members is a great step forward and will be an important tool to help members plan and prepare for retirement," he says.
"Financial advice needs exist on a continuum and expanding the scope of advice in super will better meet these needs."
This article first appeared on Financial Standard
Get stories like this in our newsletters.
