New research released today by the Financial Services Council (FSC) has revealed that in less than a decade, almost a fifth of Australian households would be eligible to buy wholesale products without retail consumer protections, leaving them potentially vulnerable due to not properly understanding the associated financial risks.
Polling conducted by C|T Group on behalf of the Financial Services Council (FSC) of more than 2500 Australians across the country, has found 87 per cent trust themselves over the Government when it comes to deciding which retirement products to use.
In December, the Treasurer released a Discussion Paper outlining proposals to improve how Australians spend their superannuation savings at retirement. This included a potential to default people into retirement products and a standardised product superannuation funds would have to offer their customers in the first instance.
CEO of the FSC Blake Briggs said: "National polling shows the Treasurer should be careful not to default superannuation consumers into Government designed retirement products as Australians overwhelmingly support making their own financial decisions at retirement, with the support of affordable financial advice.
"There is significant risk for the Government if they were to try and convince Australians that politicians know best determining which retirement products they should use."
The C|T Group research shows that almost three quarters of the respondents want to choose or tailor their retirement rather than receive a default product.
In particular, 77 per cent of Australians who are between 45 to 55 years old, a politically sensitive cohort given they have saved through superannuation for their entire working lives and would be the first to be affected by the Government's proposed changes, say they would prefer to have more control over their retirement savings instead of using a standardised retirement product.
"Consumers' preference for control over their retirement savings is a cautionary warning to superannuation funds that are considering whether to impose 'one-size-fits-all' solutions onto members at retirement.
"Retirement is complex, and every family is unique, making affordable and accessible personal financial advice that tailors retirement outcomes for each household the key to delivering high quality retirement outcomes," Mr Briggs concluded.
The C|T Group polling for the FSC reveals 70 per cent of respondents trust themselves over their superannuation fund to make decisions about which retirement products to use.
The polling also reveals that 76 per cent said they were likely to seek advice on retirement products with 62 per cent of those people likely to seek it from a financial advisor.
The findings also include:
- 73 per cent of Australians trust their superannuation fund over the Government and 70 per cent of voters trust themselves over their superannuation fund.
- 76 per cent of Australians support superannuation funds being able to provide consumers with basic advice and guidance about which retirement products to choose based on their personal circumstances and goals.
- 79 per cent of those approaching retirement (55 to 64 year olds) support retirement advice being provided by their superannuation fund.
- Australians want the Government to prioritise ensuring funds generate competitive investment returns for consumers.
