About $125k nest egg bump for 30-year-old Aussie on average salary amid super hikes, Australian Retirement Trust shows
This is the finding of Australian Retirement Trust (ART) which said the gradual increase of the mandatory superannuation contributions from 9.5 per cent in 2020 to 12 per cent from the start of July will contribute more than six figures into young Australians' super accounts.
ART's executive general manager for advocacy and impact Anne Fuchs said a 30-year-old on $100,000 per year – the average salary in Australia – will reap massive benefits of the increases since 2020.
"In a fortnightly pay statement, the increase in the superannuation guarantee rate may seem tiny,' Ms Fuchs said.
'But over a working lifetime, the magic of compound returns can turn those small increases into hundreds of thousands of dollars.'
It comes as working Aussies will receive a 0.5 per cent super contribution bump from the start of the coming financial year.
Mrs Fuchs likened the increase to 'reaching the summit of your own financial Everest' for many working Australians.
'Since the superannuation guarantee was introduced in 1992, it has become the cornerstone of Australia's retirement system – evolving from a modest three per cent contribution to a robust framework that provides you with meaningful savings for your future,' she said.
'An increase in superannuation contributions means you'll be adding that little bit extra to your super and over time, that really adds up.'
The gradual super contribution changes from 9.5 per cent to 12 per cent was originally proposed under the Rudd government and enacted under former prime minister Scott Morrison.
Other research from the Association of Superannuation Funds of Australia showed a 30-year-old worker earning $75,000 will be $20,000 better off due to the 0.5 per cent super change.
The bump comes as Australia's $4.2 trillion super nest egg will grow from the fourth largest super pool in the world to the second over the coming decade.
This is according to a report from the Super Members Council which showed Australia will surpass the United Kingdom's and Canada's pensions amid growth in Australia's superannuation guarantee scheme.
Super Members Council CEO Misha Schubert lauded Australia's super system as the 'envy of the world'.
'Australia has the fastest growing super system globally – twice the rate of international peers,' Ms Schubert said.
'We're the only OECD country where spending on government-funded pension payments is falling and will continue to fall.'
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