My gran didn’t have a lot of money to enjoy her retirement. A hipster before her time, she re-used even the most basic items – from jam jars to wrapping paper – assuring nothing went to waste.
While the generations have moved on, my gran is far from an exception. For many people, superannuation is an afterthought. Personally I’m not into the idea of living off meagre savings in my old age and being unable to generate more. The future doesn’t look too bright when you’re eyeing up the cat food isle for dinner.
So, why don’t we care about superannuation?
There seems to be a disengagement that happens with money that can’t be accessed until the age of 65. Relationships, children, study, paying off debts, family and buying a home all seem to weigh much more heavily on people’s minds.
For women, superannuation is a particularly prickly pear as they can take many years out of the workforce to raise children (thus, not contributing to their super balance), typically earn less after stepping off the corporate ladder, yet live longer.
A survey by Australian Ethical in 2013 found that seven out of 10 women believed finances, and looking after their financial future, was a top priority for them. However, when asked how important superannuation is to their financial future, only 27 percent felt it was very important.
An informal poll I conducted amongst my Australian female Facebook friends found while most were interested in superannuation, they ranked getting out of debt or saving for a house as their most pressing financial concerns. They were also confused about how their superannuation money should be invested, to the point that 75 percent had either no idea, or were invested in whatever their fund’s default option was.
What can you do today to make a real impact on your future super balance?
- Make a conscious effort to find out what you’re invested in then choose something that suits your life stage.
- Consolidate your super accounts. You may have as many accounts as you’ve had jobs, and you’re paying fees on all of them.
- Salary sacrifice your super. You can arrange this through your employer. The money goes into your super fund pre-tax so it never hits your normal bank account.
- Find any lost super, there’s apparently $14 billion of it out there and some of it might be yours.