Super funds are finally overhauling retirement. Here’s what’s changing

There are currently between 150,000 and 200,000 Aussies entering retirement every year, as the Baby Boomers and the Gen Xers converge on this exciting stage of life. That’s potentially 2 million people who are heading towards some of the biggest financial decisions of their lives, often with a blindfold on.

And I need to tell you the truth. If you leave retirement planning until you’re 65, by the time you’re sitting down with an adviser or your super fund, many of your biggest retirement decisions have effectively already been made for you, whether you like it or not.

How much you have saved, how your money has been invested, and how much choice you have about your lifestyle in the years before and after, all matter earlier. You might not have consciously made those choices, but by putting them off, you’ve narrowed your options.

That’s why I think more Australians need to understand their pre-retirement and retirement choices earlier, get help to work out what they can do to improve their position, and have the confidence to act while they still have time to make a difference.

But that requires two things: better quality advice that really does act in the consumers’ best interests, and super funds that step up and provide practical, affordable retirement planning services, and good support for people who don’t need or can’t afford to be paying thousands of dollars a year on comprehensive advice.

Particularly when that advice may come with a recommendation to moving their money onto an investment platform with ongoing adviser fees.

For many Australians retiring in the next decade, retirement income will come from a combination of super and the age pension.

And, there’s some encouraging news on that front. Over the last 12 months, some of Australia’s super funds have made significant improvements to the help they’re offering members approaching and entering retirement.

And if you’re within 10 years of retirement, it’s worth knowing what’s changing because some of these services could make a real difference to the choices you have ahead of you. The improvements have become clear through the annual assessments for the Epic Retirement Tick, which I developed in partnership with research house, Chant West, who independently assesses the funds.

Until recently, most Australians have had little or no understanding of the services their super funds have offered, let alone what they could reasonably expect. But that’s changing, and consumers are gaining more power to demand better help too.

We’re seeing better retirement education, with funds moving beyond the old-fashioned, poorly attended super seminars and boring technical websites towards more engaging online webinars, courses and structured education programs that help people better understand their choices. There are more videos, more real life case studies, and less dense text to wade through.

There’s also a welcome improvement in age pension education. More funds are creating dedicated sections on their website explaining how the age pension works, who might qualify and how it interacts with super and what people need to think about when applying.

This is important, and it recognises that for many Australians retiring in the next decade, retirement income will come from a combination of super and the age pension and understanding one without the other isn’t enough.

We’re also seeing more useful online retirement planning tools, where you can experiment with different scenarios, test what happens if you retire earlier or later, explore the impact of going part-time before you stop working altogether, and see how your super and the age pension might work together to provide an income throughout retirement.

These aren’t just tools for people who are about to retire. They’re potentially even more valuable if we could get them into people’s hands 5 or 10 years beforehand, when you’ve still got time to do something with what you learn.

And importantly, more funds are introducing calculators specifically for people who are already retired. These help retirees understand how long their savings might last, what happens if they increase or decrease their spending and how their income might change over time.

It’s a crucial improvement because retirement planning shouldn’t stop the day you retire. People need help managing retirement, not just help getting into it.

Another really encouraging development is the growing availability of more affordable retirement advice from funds. Some funds are expanding their digital advice services, while others are making it much easier to speak to someone about retirement income, investment choices and how the age pension might fit into your plans.

Some are also starting to recognise that retirement planning is most often a household decision for anyone who is not single, and are finding ways to include a partner’s circumstances.

This stuff matters because frankly, not everyone needs an expensive and comprehensive financial plan. Sometimes you just need help to understand whether you can afford to retire at 62 instead of 65, whether you should change your investment mix, or how much income you could realistically expect to draw from your savings alongside the age pension you might be eligible for.

There’s also been some pretty decent improvements behind the scenes in some funds on complaints handling and call centre services. Funds are putting more resources into making it easier for members to speak to someone who can actually help, get questions answered and navigate the paperwork and processes involved.

And when things go wrong, we’re seeing improvements in how quickly complaints are handled and resolved, rather than leaving members waiting weeks for answers.

Importantly, there’s much more attention being paid to fraud and cybersecurity risk this year. Knowing your fund has strong cybersecurity protections and multifactor authentication might not be the most exciting part of retirement planning, but with AI making scams more sophisticated, you want to know your life savings are properly protected.

But not everything is moving as quickly – funds are taking much longer to develop more sophisticated digital advice offerings and lifetime income retirement products. Ian Fryer, general manager of Chant West, says he expects considerably more activity in these areas over the next two years.

And there’s one area where there’s clearly more work to be done: helping people who are retiring and are already retired know how much they can afford to spend. Too many retirees simply draw the legislated minimum drawdown when they could comfortably afford more. Funds are getting better at providing calculators, but relatively few are proactively helping members make those spending decisions.

So, if you’re within 10 years of retirement, don’t wait until you’re ready to stop working to find out what your super fund offers. Get onto its website, explore the tools, book in for some education and ask what else is available.

You might be surprised by how much you can do now to improve your retirement later.

Bec Wilson, bestselling author of How to Have an Epic Retirement, is a retirement educator and founder of the Epic Retirement Institute. She writes a weekly newsletter about modern retirement at au.epicretirement.net. She has various commercial arrangements with a range of organisations, including superannuation funds.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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