Australia’s ageing population and the increasing cost of aged care will require super funds to expand their offerings and, importantly, assist in addressing the issue, says The Association of Superannuation Funds of Australia (ASFA).
Speaking at the 2015 ASFA Conference in Brisbane yesterday, ASFA chief executive Pauline Vamos said there is a growing correlation between aged care, health care and super.
“We need to understand in the holistic way the financial challenges and needs of people from early [stage] active retirement to the frailty of very old age. We need to deliver products and services that meet those needs,” Ms Vamos said.
Releasing a survey which examines community attitudes towards aged care, Ms Vamos indicated that close to 50 per cent of Australians believe their fund should play a greater role in helping to organise and pay for aged care.
“There is considerable demand for financial advice and educational tools and materials on aged care,” she said.
Moreover, three in five, or 60 per cent, would take up such tools if offered by their fund.
“This is a significant opportunity for us and it’s a significant opportunity lost if we don’t meet the challenge,” Ms Vamos said.
“We are moving into a world where [fund] members will expect holistic advice to address all of their financial needs in retirement.”
According to Ms Vamos, it is unsustainable for both state and federal governments to meet the needs of Australians in terms of aged care and health care alone.
She pointed out that by 2054-2055 the Australian government’s aged care expenditure will likely rise from 0.9 per cent of GDP at present to 1.7 per cent. Health care costs funded by the government, said Ms Vamos, are also projected to double in real terms per person over the next 40 years.
“So in this political context we have no choice but to re-think the interaction between the super system, the aged pension, health care, aged care as well as other assets like the family home.”
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