FSC links active super choices to stronger retirement outcomes

Australians who actively engage with their superannuation and seek financial advice could significantly improve their retirement outcomes, according to new research commissioned by the Financial Services Council (FSC).

The research, conducted by NMG Consulting, found making relatively simple decisions early in a person's working life, such as switching to a lower-fee or higher-growth superannuation option, can substantially increase retirement savings compared to remaining in a default MySuper product.

Among the findings, an individual who switches to a lower-fee investment option from age 30 could retire with up to $1.2 million from a default MySuper fund to a high-growth option at the same age could increase retirement savings by as much as $690,000.

The report also found MySuper members are typically underweight growth assets by 14% suggesting more than seven million Australians under the age of 50 may be structurally underexposed to growth investments, potentially reducing retirement balances by around $540,000.

FSC chief executive Blake Briggs said greater engagement with superannuation at key life stages could materially improve long-term financial outcomes.

"People engaging with their superannuation and making active choices at pivotal life stages, such as early career and retirement, can have a material impact on their financial future," Briggs said.

The findings comes as policymakers consider reforms following the Sheild and First Guardian collapses. While supporting targeted measures to address alleged misconduct, Briggs cautioned against changes that could inadvertently reduce consumer choice.

"Policy proposals that make it harder for Australians to exercise control over their superannuation will directly harm their financial wellbeing," he said.

The report also challenges the perception that platform products are inherently more expensive than MySuper, finding compact and mini wrap platforms can offer comparable fees, particularly for higher account balances.

NMG Consulting director Lachlan Reardon said consumers increasingly value investment flexibility and tailored solutions.

"Choice is a spectrum, and it's important that consumers have access to products that can be tailored to their individual risk appetite and retirement goals," Reardon said.