• Raise super payments to 18 per cent if you want to be independent in retirement
    3 replies, posted
Former treasurer Peter Costello says Australians will not have enough money to become self-funded retirees if they rely solely on employer contributions to superannuation. "If you truly want to become independent of the government, a self-funded retiree, live off superannuation, you're going to have to put your own money in," Mr Costello told 7.30. "The occupational superannuation is not going to do it." Professor Susan Thorp from the University of Sydney Business School said people would need to contribute much more than the current compulsory super rate to become a self-funded retiree. "If it were the case that people actually wanted to become entirely independent of the age pension, for example, they would probably need to start contributing about 18 per cent at the beginning of their working life and contribute that all the way through their working life," she told 7.30. "Most of us are, I think, probably realistically not prepared to do that." Compulsory employer contributions to superannuation are currently set at 9.5 per cent. The rate is legislated to reach 12 per cent in 2025. Last year a Grattan Institute report suggested most people would have enough money to retire on if the compulsory super rate was left at 9.5 per cent. Former prime minister Paul Keating disagreed, saying 12 per cent would "barely cut it". According to the Department of Social Services, 42 per cent of Australian retirees receive the full age pension. Since 1997 the proportion of Australians receiving full or partial age pensions has fallen from 79 to 70 per cent. https://www.abc.net.au/news/2019-04-08/superannuation-want-to-be-independent-in-retirement/10976250
Not being done fast enough to prepare the mass influx of boomers who will be retiring soon.
The absolute youngest of the baby boomers are 55 while the oldest are 73. Practically half of them are already retired. And most of them wouldn’t have had enough super anyways given that superannuation was only introduced during the height of their careers. But you’re right in that it isn’t being done fast enough anyways, because the current 9.5% rate may not be high enough for most Gen X, Millennials and Gen Z to accrue enough superannuation before they retire, so that they won’t need the age pension.
Millions of Australians aren't even getting superannuation in the first place, with people working as contractors, through gigs or even being underemployed they simply aren't in employment which has to pay them super, and this doesn't account for the ~$3 billion dollars a year which workers should be getting paid super but their employers are holding back.
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