Why you should understand how investing works
Published 23-APR-2021 10:50 A.M.
2 minute read
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Let’s face it, we will all retire someday and like death and taxes, it is something you really can’t ignore. That said, if you prepare for retirement, you can control when you retire and how much you retire with.
What is concerning is that according to the Association of Superannuation Funds Australia (ASFA), women retire on average with a balance of $122,848 in super, while men retire with $154,453.
In the Consumer Sentiment Tracker report to March 2021, Finder.com.au shows that there are 24.4 million superannuation accounts in Australia, although only 3 in 4 Australian’s have superannuation, which is less than the number of mobile phone plans Australians hold.
As Finder rightly states, superannuation is crucial to financing your retirement to ensure you can live comfortably, but as they indicate 38 per cent of Australians don't understand how superannuation works, which is alarming given how important it is for our future lifestyle.
When you look at the figures on how much Australians are retiring on, it shines a light on two important areas; firstly, it is easy to see that unless Australians have investments outside of superannuation, there will continue to be a large gap between the lifestyle desired by Australians in retirement and the reality they will experience.
Secondly, it shows a major failure in our systems around educating Australians in financial literacy. Times have changed and all Australian’s need to change with it, which means taking responsibility for their retirement rather than relying on the Government to pay a pension.
For those who are prepared to be a little more active, understanding how superannuation and investing works and the benefits that can be gained from putting in some effort is more than likely to pay off in retirement. The upside is that you get to enjoy a better lifestyle than what would otherwise be possible based on the information reported by ASFA above.
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S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
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