Many superannuation fund retirement calculators have been exposed as providing inappropriate advice, prompting calls for access to more independent information for retirees.
Super Consumers Australia CEO Xavier O’Halloran said the advocacy group for people on low and middle incomes in Australia’s superannuation system found many calculators were failing to help people properly plan for retirement.
Mr O’Halloran said 77 percent of calculators may recommend a default income that was too high and ran out well before the expected length of retirement or too low and lasted too long, leaving a substantial balance remaining at age 100.
“Planning for retirement is too important to just leave to super funds with a track record of poor quality guidance,” he said.
Mr O’Halloran said most calculators did not account for the higher spending needs of retirees who rented or who still had a mortgage on their home.
“No calculators included additional Government income available for renters and 73 percent failed to ask about whether someone has a mortgage,” he said.
“Our findings cast doubt on whether super funds have the capability to provide quality tools and guidance to help their members plan for retirement. With more people approaching retirement either renting or with a mortgage, calculators can’t assume everyone owns their home.”
Mr O’Halloran said most calculators did not help people accurately calculate their spending needs.
He said 73 percent of calculators did not have a budgeting tool incorporated into the retirement calculator.
“More than 30 years after compulsory super was introduced, funds are failing to support people in answering one of the most basic questions: do I have enough to retire?”
Mr O’Halloran said Super Consumers Australia was calling for a free and independent one-stop-shop to help all Australians with super and retirement.
