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Changing the mindset on your super: Are you managing your retirement income well?

15 June 2021

Money & Life team

Money & Life contributors draw on their diverse range of experience to present you with insights and guidance that will help you manage your financial wellbeing, achieve your lifestyle goals and plan for your financial future.

With the superannuation guarantee rising to 10 per cent from July, there’s never been a better time to take an interest in your retirement income.

Many people consider superannuation to be a ‘set and forget’ investment. They sign up for account when they get their first job and don’t look at it again for years. Now if super is a long-term investment, what’s wrong with that you might ask?

The trouble is, most Australians don’t have nearly enough super saved to put them on track for a comfortable retirement. In fact, we’re falling hundreds of thousands of dollars short by retirement age.

Canstar research shows that women in their 60s face the biggest super gap of more than $249,000, on average, while men end up $216,000 short. Canstar found the super gap starts early on in life.

“30-year old men and women would need to have around $54,000 in their super account today, but on average, they are currently between $26,000 and $31,000 short of that balance.”

Changing your retirement income

The good news is that by actively engaging with your superannuation, you can make a real difference to your retirement income.

Christine Lusher CFP® of Serendipity Wealth Advisors says with super making up 10 per cent of your salary from July, it’s worth paying some attention.

“For those just starting out in the workforce, understandably superannuation is not your biggest priority, but a little attention now will pay off in years to come,” she says.

Five simple ways to engage with your super

So what can you do now, to make a difference come retirement? No matter your age, here are five simple things you can do once a year to stay on top of your super.

  1. Look over your account statement. It’s usually issued around July or December. Take a close look at the change in value of your super, as well as the annual, five and 10-year returns, to see how your fund is tracking. Read any commentary that comes with your statement, so you understand what contributed to your result for the year. Also check the fees you’ve paid to see if you’re happy with them.
  2. Even better, get access to your super account online. Make sure to login at least once a year and review your investments. If your super is going into the default investment option, consider whether it’s the right choice for your age and stage of life.
  3. Review your insurance cover to see if it’s appropriate for you. If you’re relying on the insurance as your primary cover, make sure you’re aware of the terms and limitations of your policy.
  4. Check that your employer contributions are actually being paid. Don’t assume that the figure on your payslip means the money is in your fund.
  5. Consider whether you need to make any extra contributions to your super to reach your retirement goals. Use a super calculator like this one from MoneySmart to work out whether you’re on track.

Investing for your life stage

As your risk profile changes over your lifetime, it makes sense to review your investment strategy at certain intervals.

Ms Lusher says younger people, who are just starting to build up their superannuation, can afford to choose a higher-growth investment fund, as they have more time to weather the market ups and downs.

“There will be many investment cycles in your lifetime, so don’t be disheartened with periods of negative returns,” she says.

For those nearing retirement, Ms Lusher says it’s important to consider not only your tolerance to risk, but how long you need your super too last.

“Beware of going too conservative at retirement as your super still needs to last your remaining lifetime, which for someone aged 65 could be another 20 years,” she says. “Consider different pools of superannuation money, such as one that pays your income and another that’s invested for the long term.”

Whatever you do, avoid “chasing returns” by switching to the best performing option every year, she warns.

“Though everyone should keep an eye on their investment strategy, beware of making changes too often. Pick an investment option you’re comfortable with and stick to it.”

When to get financial advice

Ultimately, if you want to be sure you’re on track to meet your retirement goals, you should seek professional financial advice. A financial planning professional can help you tailor an investment strategy to your individual needs, and advise you on how to transition to retirement.

“If you’re nearing retirement and are uncertain about how you should structure your superannuation savings, it’s really important seek advice, as mistakes can be costly,” Ms Lusher says.


Not quite sure what’s happening with your retirement savings? For tailored advice on reaching your financial goals, speak to a CERTIFIED FINANCIAL PLANNER® professional using our Match My Planner tool.