23 June 2021
ASFA: Super rise to super-size Australia’s retirement savings
The Association of Superannuation Funds of Australia (ASFA) has today released new analysis of the impact on retirement balances of the July 1 increase in the Superannuation Guarantee (SG) to 10 per cent.
“The key objective of super is to provide dignity in retirement,” said ASFA Deputy CEO and Chief Policy Officer, Glen McCrea.
“It’s clear that the Super Guarantee rise puts Australians firmly on track to achieve the dignified retirements they deserve.”
The Super Guarantee is legislated to rise in annual half per cent increments from 10 per cent on July 1, 2021, through to 12 per cent on 1 July 2025.
“For the average Australian worker, the July super increase represents an extra $19,000* in their super nest- egg at retirement.”
“The long-term benefits of the system reaching 12 per cent are even greater. For the average Australian worker, the change will mean an extra $85,000 in super at retirement.”
ASFA has examined the impact at retirement of the SG increases for an average 30-year-old worker, living in various states across the country.
| State/Territory | Impact of SG remaining at 9.5% | Impact of SG 10% on July 1 | Impact of SG 12% on 1 July 2025 |
|---|---|---|---|
| NSW | $463,000 | $482,000 | $551,000 |
| VIC | $440,000 | $458,000 | $523,000 |
| QLD | $434,000 | $451,000 | $515,000 |
| SA | $425,000 | $443,000 | $504,000 |
| WA | $472,000 | $491,000 | $562,000 |
| TAS | $410,000 | $426,000 | $485,000 |
| Australia | $449,000 | $468,000 | $534,000 |
The increase in the Super Guarantee to 12 per cent will mean double the proportion of Australian workers will reach the ASFA Comfortable Standard at retirement of $545,000 for a single person.
“Currently only 25 per cent of Australians achieve a self-funded retirement.”
“By 2050, that number is set to double as a result of the super system moving to 12 per cent. It’s a significant shift which will underpin Australia’s fiscal sustainability by diminishing the reliance on the age pension,” Mr McCrea concluded.
For further information, please contact:
Jacqui Maddock, 0451 949 300.
About ASFA
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral, and non-party political, national organisation. ASFA’s mission is to continuously improve the superannuation system, so all Australians can enjoy a comfortable and dignified retirement.
*Projections assume a hypothetical person is 30, has a starting balance of $40,000, earns average annual wages for Australia ($68,000) during his/her career and retires at age 67. The projections are for illustrative purpose only – in reality, a worker will not earn average wages throughout his/her career. Sources: ABS, Average Weekly Earnings (November 2020); ATO, Taxation Statistics (2018-19); and ASFA calculations.
