Only half of Australia’s working population is on track to achieve a financially comfortable retirement lifestyle, according to consulting firm Mercer.
The 2016 retirement readiness index released this week by Mercer highlighted that while Baby Boomers were the least prepared for retirement, Millennials were “not doing so well either”.
Mercer said only 53 per cent of men and 41 per cent of women were presently on track to reaching a comfortable retirement lifestyle, and cautioned super fund members to treat their superannuation more seriously.
Voluntary super contributions were shown to have a significant impact on retirement income, however Mercer found only 16 per cent of Australians make such contributions on a regular basis.
Both funds and their members need to take a more active approach in identifying possible lapses in retirement adequacy, and act sooner rather than later in order to address them, said Mercer senior partner David Knox.
“Using the retirement readiness index, funds can easily identify the least prepared, and help them be more active where it counts. The correct investment strategy choice is crucial to ensuring financial security in retirement,” he said.
“Members must also consolidate their accounts and be strongly encouraged to regularly make voluntary contributions.”
In another report released earlier in the week, Investment Trends found that less than 10 per cent of superannuation fund members were confident their super balance would provide them with an adequate retirement income, with 15 per cent lacking any confidence in their super at all.
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