A roundtable of leading influential voices for millennials is sounding the alarm for superannuation funds to lift their game and increase services, transparency, and improved access to information to better engage millennial members, says ASIC in a statement.
ASIC’s Moneysmart convened the roundtable, bringing together a panel of highly recognised Australians from financial advice, research, and content creators for this cohort. The panelists agreed that the current language and approach to superannuation is outdated and disengaging for millennials.
ASIC’s Moneysmart programme helps Australian investors and consumers by providing free and independent financial information and tools. Almost 11m Australians visit the Moneysmart website each year.
New research from ASIC’s Moneysmart revealed the concerning trend that nearly half (48%) of surveyed millennials admit they are not knowledgeable about maximising their super. Despite being the first generation to enter the workforce with compulsory superannuation from day one of their working lives, millennials are less engaged with their super compared to previous generations.
Speaking at the roundtable, ASIC Commissioner Ms Simone Constant said, “I encourage superannuation fund members to think of themselves as a customer. As a customer, you have choices and can demand services that match your needs as you would from other financial services providers, such as your bank or insurer.”
Improving retirement outcomes and member services is one of ASIC’s five strategic priorities for 2024-28.
Language
The roundtable members said that super funds must evolve or risk losing the trust of millennials. Terms like “retirement planning” and “pensions” fail to resonate with a generation more focused on their immediate financial goals and the current cost of living.
“Super funds need to avoid jargon and use relatable examples so people can proactively engage,’ added RMIT Associate Professor Dr Angel Zhong who was a roundtable member.
With around A$2.7tn ($1.8tn) in superannuation in Australia, excluding self-managed super, the roundtable panellists called for super funds to be more accountable to their members. The need for easy access to tools and calculators as well as goal-setting information was highlighted as crucial for fostering engagement.
Mr Andrew Dunbar, a roundtable member and a financial adviser at APT Wealth, said, “Superannuation calculators help people connect with their super. They can help show people the lifestyle they could be living, as well as help to track progress and see how changes with contributions can have an impact.”
Control
The panellists agreed that superannuation is one area where millennials can take control without additional financial strain.
‘We need to shift the mindset from seeing super as competing with our immediate financial goals to appreciating it as an essential part of our overall financial journey,’ Ms Effie Zahos, finance journalist and the roundtable host, added, "You don’t have to contribute extra to your super to boost your returns; just give it some extra time to make sure it’s working for you."