Industry superannuation funds are set to continue their dominance of the sector, with not-for-profit funds already accounting for about two-thirds of Australia's total superannuation assets.
Insights from Rainmaker Information show retail super funds experienced a growth rate of 6% in the 12 months to September 2017 to $593 billion, which almost pales in comparison to the 11% rise in not-for-profits funds over the same period.
In the same 12 month period, Australia's superannuation assets reached $2.394 trillion - $1.04 trillion of which is contributed by not-for-profit super funds, largely industry funds.
This growth could be easily maintained given industry funds boast both the largest membership base and youngest members, providing industry funds with the greatest long-term or lifetime growth potential, according to Roy Morgan.
The data shows that of Australia's 13.4 million superannuants, 6.8 million (50.7%) belong to an industry super fund. In comparison, 3.9 million (29.1%) are members of a retail fund.
This is bolstered by the additional growth potential afforded if industry funds are able to retain their members through to retirement, given the considerable difference in age of industry fund members when compared to other segments.
The current median age of industry fund members is only 39.6 years, while that of retail funds is 45.7 years. Self-managed superannuation fund members (SMSFs) are the oldest at a median age of 59 years, followed by public sector funds (49.6 years).
In line with the age gap, the median balance of an industry fund member is $38,500 - significantly lower than the market average of $57,800.
However, Roy Morgan industry communications director Norman Morris warns that an increase in super balances could see a shift in the data.
"With higher balances there is likely to be a greater use of financial planners which often have a leaning towards their own funds or other retail funds and move away from industry funds. Another major issue is the challenge of high balances moving to SMSFs which impact retail and industry funds," Morris said.
Another challenge to maximising the long-term potential of younger members is their lack of engagement with superannuation, which is further hindered by the demographics' lack of trust in financial planners, Morris added.
"For young people to become more engaged in superannuation they are likely to need financial advice and education but this has proven difficult in the past because of cost, the level of interest and trust. The poor rating in the overall population for financial planners regarding their ethics and honesty [from the Roy Morgan 'Image of Professions' survey] is likely to prove a barrier to their wider use," he said.