Australians' lack of engagement with their super could be addressed if they were encouraged to think more about their future selves, says consulting firm Milliman.
Super funds are presenting Australians with an inaccurate picture of their future lives in retirement, which is causing members to 'switch off', says Milliman senior consultant Jeff Gebler.
"Attempting to persuade members to save more super by using broad-based, one-size-fits-all targets, has failed," Mr Gebler said.
However, he pointed to research that suggests when members are able to see their future selves in "vivid and realistic detail", they are more willing to make choices that may benefit in retirement.
In general, he said, people have a "fundamental inability" to project their thoughts and feelings into the distant future – a phenomenon known as 'temporal' or 'hyperbolic discounting'.
"Rather than resolve this contradiction, research shows that strengthening the link between these separate selves in positive ways can effectively change behaviour," he said.
"If speaking to members in terms of their future selves is the key to engagement, then the converse must hold as well; inaccurate portrayals of the future must lead to disengagement.
"The super industry’s dominant comfortable retirement savings target is not a true reflection of who they are or who they will become. For example, it is built from the ground up based on assumptions about our retirement wardrobe," Mr Gebler said.
Super funds can harness powerful analytics to understand the likelihood of members meeting retirement objectives that are truly meaningful to them, he said.
"In this way, funds can begin the journey to help members see their retired selves in meaningful and positive terms, forming the basis for genuine engagement and better long-term decisions," he said.