$46 billion better off: The ‘super' shifts that can redefine retirement

AU Financial Review

05-06-2025

First, adopt age-based investment strategies. This is the simplest and most impactful place to start. Yet today, less than one-third of the MySuper accounts in Australia are invested in this way. Russell Investments' research shows that if all super funds had implemented suitable age-based investment strategies five years ago, Australians with MySuper accounts would be $46 billion better off — an average uplift of 6.6 per cent per person.
Second, go beyond age to tailor investments to individuals' circumstances. Investment strategies should consider the amount of super saved, retirement timing, contribution rates and assets held outside super. Today, most Australians are still placed in default portfolios that overlook these inputs. Without more personalisation of their super, they risk falling into two traps come retirement: some may run out of money too early, while others may be overly cautious and miss out on the lifestyle they worked hard to afford.
Third, use technology to make it easy for people to set retirement goals, track progress and adjust along the way. Planning for retirement shouldn't begin in the final few years of work. Just setting a goal and managing to it can enhance outcomes. This is an area where technology can be a powerful differentiator. Most Australians are familiar with technology that help track fitness, spending or habit formation; retirement planning should be no different.
Russell Investments was one of the first in Australia to bring digital planning tools to superannuation, enabling fund members to assess how their projected retirement income aligns with their retirement goals. Data shows this approach is working. More than half of the members that set a retirement income goal are on track or ahead of their target — a 43 per cent increase since 2020.
This goal-based feedback becomes a far more useful guidepost than an account balance, especially during periods of market volatility. It helps inform the actions to take (or avoid) to stay on track, including how to invest, how much to contribute, and when they might retire. For example, two people may be the same age and close to retirement but require very different strategies. One who is on track might benefit from reducing investment risk to protect their savings. Another who is tracking behind may need to increase contributions, take on more risk, or delay retirement to close the gap.
Personalising super through age-appropriate investing, individualised strategies and goal-based guidance can help improve outcomes and close the retirement savings gap. It gives more Australians, not just those with access to a financial adviser, the ability to align their super with the life they want after work.
If more super funds embrace these changes, Australia won't just maintain its position as a global leader in retirement savings, it will help define the future of retirement security.