Australians choosing a different journey to retirement

Australians are increasingly embracing investing outside superannuation to carry them through retirement.

Investment giant Vanguard recently released its inaugural How Australia Retires study and found that while many working-age Australians still consider their superannuation a vital plank in their retirement plans, many are also taking up investing in the stock market, investment funds, cash and property.

The study surveyed more than 1800 working-age Australians and found that 54 per cent estimate their super balance constitutes half or less of their total investment balance.

The study found that while 50 per cent of working-age Australians view super as an important part of their retirement savings, they expect to be relying on it less than current retirees do. 

Investing outside super

Fewer than half make extra super contributions.

“Although Australians continue to regard superannuation as a key component of their retirement savings, investments outside of super are growing,” Vanguard Australia managing director Daniel Shrimski said. 

Vanguard found that working-age Australians no longer plan traditional employment and expect to take breaks for parental leave, carer duties and studying.

“This next generation of retirees will need to factor in the financial cost of extended career breaks, particularly the impact that time away from full-time work can have on superannuation balances and long-term retirement savings,” the report stated.

However, it also found one in three working-age Australians want to continue some form of work into retirement because they feel they will not be able to afford retirement without extra income or they expect to still be repaying a mortgage.

The study also found a surprising lack of engagement with super, with one in four unsure of their current balance and one in four not aware of what they pay in fees.

Lack of engagement

It also found one in two working-age Australians have not made contact with their fund in the past 12 months, while three in four retired Australians have not made contact in the past six months.

“Engagement has long been a challenge in super, and there is clearly an opportunity for the industry to rethink member experiences and methods of engaging members meaningfully with their retirement savings,” Mr Shrimski says.

According to the study, one simple way to boost retirement confidence is to have a plan.

The survey found that those who are highly confident about their retirement have actively prepared for the next phase of their life. They are more likely than any other segment to set budgets, prioritise savings, and regularly contribute to their superannuation.

“Australians who have received professional advice are also twice as likely to have a clearer, more detailed retirement plan, and are twice as likely to feel confident that they will be able to fund their retirement lifestyle,” the report stated.

People with a more detailed plan have also typically taken more action to prepare for retirement, particularly in debt management and budgeting, while also making additional superannuation contributions and investing in securities and property.

“One of the key findings in this report is that having a well-documented, detailed financial plan is one of the most effective ways to not only achieve a successful retirement, but to alleviate the emotional burdens and anxieties that Australians can feel towards retiring,” Mr Shrimski said.

Do you know your super balance? Do you have investments outside superannuation? Why not share your experience in the comments section below?

Also read: How much do you need for a comfortable retirement?

Jan Fisher
Jan Fisher
Accomplished journalist, feature writer and sub-editor with impressive knowledge of the retirement landscape, including retirement income, issues that affect Australians planning and living in retirement, and answering YLC members' Age Pension and Centrelink questions. She has also developed a passion for travel and lifestyle writing and is fast becoming a supermarket savings 'guru'.


  1. My super balance has gone backwards the last few years. Or rather it has made money but that has been swallowed up in fees to the “experts”. I paid off my mortgage instead of adding to super, and am very glad to have done so.

  2. It’s easy to say ‘ engage with your super provider’ but these companies should try phoning their own organisation. My wife and I have five accounts with the biggest industry fund and time and time again I find the members number they ask for on the phone is in fact the account number which is different.
    The ATO told me I had to move funds from a pension account into an accumulation account. The super fund said I couldn’t, the ATO said I must. It took two months and submitting a 36 page questionaire three times and numerous phone calls to get it done. The pension and accumulation funds seem to be run by two separate companies and don’t talk to each other. So when you have a spare half day, engage with your super fund, Good luck.

  3. The number one asset to have, if you are going to enjoy your retirement, is a home!

    Superannuation is very important but, if you had to, you can live (exist) on the pension, but NOT if you are paying rent!

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