Industry Insider lifts the lid on Super – Not Fit for Purpose in Retirement

This week at the Financial Services Council Retirement Income Products Conference, industry insider, Jeremy Cooper, Chairman, Retirement Income, Challenger Limited declared that “our pure defined contribution (superannuation) system is not completely fit for purpose in retirement”.

And to put this in context for those who don’t know who the Financial Services Council (FSC) is.  Its members represent the most of the finance industry in Australia, including Australia’s retail and wholesale funds management businesses, superannuation funds, life insurers, financial advisory networks and licensed trustee companies.  About the only non-members I can see are the Industry funds.

Supposedly these members manage more than $2.7 trillion of our money.  Yes our money, not theirs.  And their vision is that “all Australians have a fair and financially secure future”.

What a load of bull!  And Mr Cooper declared this loud and clear this week with statements at the conference like the one above and these:

“We need to accept an inconvenient truth.  Our wholly individualised defined contribution system is not up to the task for the vast bulk of retirees who cannot afford to manage those risks themselves”

“This might come as a shock to some, but there is a serious question whether a defined contribution system like ours is fit for purpose in retirement.”

Finally someone in the industry owns up about what I have known for ages.

Super is not fit for purpose in retirement.   For most people, their superannuation will never be enough.  And as a result they are facing a life of working on the treadmill till they drop.

And this is supported by the words of the Hon. Paul Keating, who could be considered the architect of Australia’s superannuation system.  At the Association of Superannuation Funds of Australia (ASFA) – 50th Anniversary Conference in 2012, he clearly stated in that speech that “We built something that took people from 55 to 75”.

Now, as the Hon. Paul Keating said in the same speech, we have a system, where superannuation may look after you for the first half of your retirement, till about 75.  But after that, you are left living on the pension.

Don’t believe me, watch the below video, where I use glasses of water and prove your super will never be enough – why super is not fit for purpose.

So hopefully you now know what the industry already knows.  Superannuation is not fit for purpose in retirement.

Your super will never be enough and you need to start doing something today to get off that treadmill of working till you drop.

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Do you and your family a favour and start taking steps so you can improve the health of Your Wealth and get off the treadmill of working till you drop.

Wayne Wanders

The Wealth Navigator

wayne@thewealthnavigator.com.au

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