There has been a real increase in political debate around super, which once again pits Liberal vs Labor against each other on the SG increase and the importance of Australians and their super.
While there are valid arguments on both sides of the fence, the reality is that most people are not good savers, and the only way they will have a decent savings pool in retirement to draw on will be via their superannuation.
This is where advisers come in. Educating people on how important their super is, and the positive impact an increase in contributions can have is more important than ever before.
I recently went through an exercise with my husband and our financial planner. We did various modelling around how much we put in super over the next twenty years, and where that would leave us at retirement. We also looked at the impact of contribution splitting and how that could help us down the track.
I have to say, the story was very compelling. As soon as we could see via the modelling that an extra 5% could make a significant difference at retirement, we started to reprioritise our budgets to make it happen. This only happened with the help of our financial planner who had the modelling tools to visually demonstrate the impact.
With increased visual demonstrations and educational material coming from the advice community, more people would be compelled to contribute more, whether by the SG or their own contributions. When it is easy to see the impact, the decision-making becomes easier. And that valuable information alone could encourage people to invest more in planning for their future.
Their estate planning, their power of attorney and their overall investment strategy with their mortgage and investments would also have heightened engagement.
In fact, this very visible modelling and the impact that good financial planning can have on super could be one of the biggest engagement tools advisers have to get people excited about planning. There seems to be a lot of worry about money and peoples’ financial future at the moment, and we all know the only way to combat this is by having a good financial plan and sticking to it.
While we’re all reading about the debate in the news and on TV, it would be far better to have information and access to modelling from advisers and super funds to help people put the right plan in place. So lift your voices, get on social and use the tools you have at your disposal to show people the impact more super contributions can have, no matter what income level they are at.
After all, it is advisers who will do this best.
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