The SG increase to 12% will also boost the average annual net retirement income for Australian workers by $1,795, taking the average annual net retirement income to $45,710.

AMP Financial Services Managing Director Craig Meller said the Federal Government’s decision to lift the SG to 12% will have a positive impact on the retirement savings for all Australians.

“Every Australian worker deserves a comfortable retirement and recent changes made by the Federal Government demonstrate its commitment to a robust and sustainable superannuation system for generations to come,” Mr Meller said.

However it’s the children of today’s workers, those yet to enter the workforce, who will reap the greatest benefits with their retirement adequacy expected to be around 75% of their income – 10% more than the current 65% benchmark.

Factoring in an increase to the SG to 12% the Index reveals 20 to 24 year olds will benefit the most and are projected to have an extra $107,535 in assets in today’s dollars when they retire, while a 30 to 34 year old will have on average $59,737 extra.

Other key findings from the AMP Retirement Adequacy Index for the six months to 31 December 2009 are:

• Strong market gains have seen average super balances increase 5.8% or $2,192 over the six months.
• A fall in voluntary contribution levels outweighed this gain with average contribution rates declining marginally to 12.4% of individual’s salaries.
• The fall in contributions among high income earners from 28.6% to 25.1% can be attributed to the reduction in concessional contribution caps to $25,000 per annum in the Federal Budget 2009.
• The fall in contributions among low income earners may be partly due to the suspension of the co-contribution program, coupled with broader economic uncertainty.

The AMP Retirement Adequacy Index used data for the six months to 31 December 2009 from 328,000 AMP corporate superannuation clients to predict retirement adequacy based on 65% of an individual’s pre-retirement income.

Economic forecaster, Access Economics, used this data to measure the implications of the current super data for future retirement incomes.

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