Baby boomers hold retirement plans
Friday, 21 November 2008 11:15am
A new consumer survey revealed one third of baby boomers are rethinking their retirement plans as super fund balances fall amid bad markets.
The Milliman consumer superannuation survey, which was run between the extremely unstable months of September and October, found almost three fifths of respondents are concerned about outliving their retirement savings.
Inflation has also become a major concern with 70 per cent of respondents stating they were worried about its effect on their super balances.
As a result, 38 per cent of those surveyed changed the investment mix of their fund and 35 per cent of those altered their setup in the past year.
The survey also found 17 per cent said their fund performed much worse than anticipated and more than 20 per cent said their super fund had performed a "little worse than expected".
Overall, the survey revealed more than half of respondents are satisfied with the performance of their fund.
This high level of satisfaction given the markets could be attributed to "consistent and coordinated communication" from super funds to their members, said survey author and Milliman practice leader, Wade Matterson.
On product development, a high 82 per cent of baby boomers said low fees is the most important feature they consider when choosing a super fund.
An equally high 80 per cent of respondents want products that protect retirement income or guarantee an income during the member's lifetime.
The results of the survey are broadly similar to an AXA Australia survey that found more than 50 per cent of Australians are prepared to pay a small fee to protect their superannuation and remain invested in the stock market.
Milliman interviewed 1,000 people over the age of 45 with superannuation balances greater than $50,000. The firm is one of the world's largest actuarial and consulting firms with offices across Sydney, Tokyo, Seoul and Shanghai.
Michael Hobbs
