Starting July 1, more than 9.2 million Australians will see an automatic boost to their superannuation contributions, thanks to an increase in the Super Guarantee rate from 11 per cent to 11.5 per cent.
Key findings include:
- This year, 9.27 million people will receive a super boost, almost evenly split between men (4.7 million) and women (4.5 million).
- More than half of the beneficiaries are under 40, with those in their 30s seeing the most significant boost.
- A third of those receiving the increase earn less than $50,000 annually, and almost 60% earn less than $75,000 annually.
- The average West Australian will receive an extra $367 this year, the highest average super boost of any state.
- 2.1 million professionals and almost 2.7 million tradies, machine operators, and labourers will also benefit.
This change will add an extra $340 in employer-paid super contributions annually for the average Australian worker.
The 0.5 per cent rise in the Superannuation Guarantee, combined with next year’s increase to 12 per cent, could provide a typical 30-year-old with an additional $34,000 by retirement. This significant boost underscores the power of compounding returns over a working lifetime.
Misha Schubert, CEO of the Super Members Council, emphasised the importance of these legislated increases.
“Each of these increases might be small, but they are mighty – thanks to the power of compounding returns inside super over our working lives. This latest super boost will mean thousands more for millions of everyday Australians at retirement,”
Schubert said.
In retirement, this additional money will enhance the quality of life for many Australians, funding extra basics or even luxuries such as trips, dining out, and spoiling grandchildren, providing greater financial freedom and peace of mind.
Schubert highlighted the global envy of Australia’s super system for its ability to boost retirement savings, reduce taxpayer-funded pension pressure, and deliver investment capital to Australian companies.
The Super Members Council’s analysis of large-scale de-identified tax and ABS data reveals that younger Australians and those on lower incomes will benefit the most from this increase.
The Super Guarantee is essential for funding the retirement of Australia’s ageing population. Before compulsory super was introduced in 1993, only 10 per cent of retirees listed super as an income source.
Approximately 90 per cent of people aged between 30 and 50 have superannuation. This shift significantly reduces pressure on the taxpayer-funded age pension, with super payouts now surpassing pension benefits.
Despite the projected doubling of Australians over 65 and tripling of those over 85 by 2063, the Intergenerational Report indicates that the age pension’s cost as a percentage of GDP will decline, even as other costs associated with an ageing population rise.
As the Super Guarantee rate increases, Australians can look forward to a more secure and comfortable retirement, reflecting the strength and effectiveness of the country’s superannuation system.
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