Tips to get young people start thinking about superannuation

Nov 5, 2021 | Family, Relationships, Retirement, Superannuation

Engaging young people in discussions about their superannuation is hard, and to be honest, sometimes that goes for us older folks too. I even once heard a younger person describe it as “superannoyation” as it seemed to be “all a bit too hard”.

A couple of weeks ago, I read an article that acknowledged these feelings and said young Australian investors are struggling to engage with their superannuation. Quoting new research released by the investment app Superhero, it said 17% of surveyed consumers don’t know what investment options they’ve chosen for their fund. Looking at young people aged 18–24-year-olds, that figure rose to 24%.

The figures above doesn’t surprise. I’m sure we can all agree that when you are 18-24 the thought of saving money in a fund you can’t access until you are 60 seems a long time away. At the age of 18, turning 30 is a long time away let alone 60.

At that age it is hard to comprehend how your super balance is going to grow to anything meaningful. You have probably just started working and opened a super fund, or even had one opened by your employer. At that age, the concept is a little bit foreign and most likely not your first priority.

Engaging young people with their super is definitely worthwhile.

One way to do this is by starting out explaining what a super fund actually means and how it impacts their future. Take the time to explain that this will be one of their biggest assets. Compare their super fund to other more tangible assets to help put it in perspective. It is also worth taking the time to explain that their super is not only likely to be one of their biggest asset, but will potentially provide the majority of their income once they can access it. This can sometimes help as the young person is likely to have just started earning a regular income, and have seen the benefits of having their hard earned cash come into their account. The thought of no longer having this, and only relying on funds they ‘saved over time’ might make them want to start thinking about super early, so that those funds will grow over time too. That way, once superannuation is ready to be accessed, plenty of dollars is available to live a comfortable life.

Having a conversation like this can often help create a lightbulb moment as to why thinking about your super early is so important.

Hopefully you can help change the experience from being “superannoyation” to simply “super”.

Good luck with your conversation!


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Super phase vs pension phase and how it impacts your retirement

What you’re essentially doing before retirement in your “super phase” is having your employer contribute your superannuation, possibly top it up yourself with a sweet tax benefit, then letting time and compound interest do their thing. Then, once you are eligible to access your super, you switch it up to “pension phase” and access your money tax free.

How do I know I’ll retire with enough? The answer is easy.

How do I know I’ll retire with enough? The answer is easy.

One of the most common questions I get asked is about comfortable retirement. Most people want to know “how much do I need?” and whether they will be OK or not. Thinking about the future can be overwhelming, especially when you have so much on “right now”. However, I actually think it’s quite simple to answer these questions. When I look at retirement with clients, I can give a fairly accurate answer which will let you know how much money you need when retired, to live the life you want.

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