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The $100-a-week super habit that could save Aussie business owners from a $500,000 retirement shock
A retirement crisis may be brewing under Australia's economic radar, and it's not among the unemployed, but among the self-employed. A new survey commissioned by
AMP Bank
has found that close to half of Australia's smallest business owners, including sole traders and micro-businesses, are not regularly contributing to their superannuation, potentially setting themselves up for
financial insecurity
in retirement.
In a national poll of 2,000 small business operators, 55 per cent reported that they make regular super contributions, meaning that 45 per cent do not. That's a significant shortfall, especially considering that most salaried workers in Australia benefit from the mandatory Superannuation Guarantee, now set at 12 per cent.
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But super contributions remain optional for the country's 2.2 million self-employed workers, including tradespeople, creatives, consultants, and other gig economy participants.
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And many are choosing to forgo them, often to keep their businesses afloat.
'It's understandable that many
small business owners
prioritise reinvesting in their business, which can mean super contributions fall by the wayside', said John Arnott, Director at AMP Bank GO on X.
The long-term cost of short-term focus
The financial trade-off might seem minor in the short run, but the long-term implications are staggering. AMP Bank's modelling shows that contributing just $100 a week to super starting at age 30, assuming a 6 per cent return, could yield over $500,000 by retirement at age 65.
That means skipping those small contributions now could result in a half-million-dollar shortfall later in life, a costly oversight for anyone banking on a comfortable retirement.
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Who's falling behind?
The research revealed apparent disparities across industries and regions. Solopreneurs and businesses with four or fewer employees were among the least likely to contribute to super, with just 50–55 per cent making regular payments.
Owners of younger firms (1–3 years old) and those located in rural areas were also among the least engaged with super savings.
Meanwhile, small business owners in financial services showed the highest contribution rates (71 per cent ), while those in creative fields, already prone to income instability, had the lowest, at just 46 per cent.
A system not built for freelancers and sole traders?
The issue isn't just financial, it's also structural. Australia's superannuation system was designed mainly with full-time employees in mind, not the growing population of freelancers and sole traders. Flexibility may be a feature of self-employment, but it's also a flaw in this case.
Unlike employees, the self-employed don't have an employer automatically paying super on their behalf. And unless they make a conscious effort to pay themselves, and their future, first, they may reach retirement with little or nothing saved.
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What can small business owners do now?
Arnott urged small business owners to balance short-term survival and long-term planning. 'Even small, regular contributions can have a massive impact thanks to the power of compounding,' he said.
He also recommended practical strategies for boosting super savings.
These include setting up automatic contributions through your banking app or accounting software, making lump sum contributions during periods of healthy cash flow, using government incentives such as co-contributions or tax deductions, and seeking support from your super fund, accountant, or other small business owners.
