Australian retirees are already among some of the richest in the world, but their situation is set to improve even further.
That's according to new research from Super Members Council's Global Pension Rankings report, which has found Australia has the fourth-largest pension system globally, ranking behind the United States, Canada and the United Kingdom.
And the report, which focuses on the collective pool of superannuation in each country, has projected Australia will become the second-largest global pension market within the next decade, behind only the US.
The report projected that Australia will soon skyrocket to become the second-largest global pension market within the next decade, surpassing Canada and the United Kingdom. Source: SBS News
Australia's has a . Compare that to an estimated 40.1 million for Canada, and 68.35 million people for the United Kingdom.
Super Members Council says the projected increase is driven by increases in the Superannuation Guarantee and continued strong investment performance.
The council's analysis shows that between 2001 and 2023, Australia's cumulative superannuation contributions were the highest among OECD countries and well above the OECD average.
Despite having a smaller population, Australians have a hefty pool of superannuation that's only set to grow in the coming years. Source: SBS News
"Australia has the fastest growing super system globally — twice the rate of international peers," she said.
According to OECD data, provided to SBS by the Super Members Council, the average annual contribution into superannuation per active account in Australia is 11.9 per cent, up from the mandatory minimum 11.5 per cent contribution that employers must pay their employees. The mandatory Super Guarantee will increase to 12 per cent of ordinary time earnings in July.
Schubert said superannuation was a "great Australian success story" thanks to its compulsory and universal nature combined with strong preservation rules.
"Three key policy settings have made Australia's super system one of the biggest and most effective internationally and underpin its long-term success," she said.
"Because super is universal, compulsory and preserved until our retirements, total system contributions are projected to reach $141 billion for the financial year 2024-25."
"These safeguards — especially that people's investments are preserved until retirement — are the secret sauce of super, giving Australians in their millions the power of compound returns over decades."
With additional reporting from AAP.
