Joint superannuation accounts – the next front in a long campaign to better engage fund members

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Push to allow joint super accounts.

Push to allow joint super accounts.

Finding ways to truly engage superannuation fund members with their retirement savings outcomes is a long-term industry conundrum in Australia.

Superannuation funds have embarked on numerous approaches to improve member engagement levels, with mixed results.

Aside from the economic imperatives for funds to attract and retain members, there is a long list of member and community benefits – beginning with the simple outcome of closing a multi-billion dollar retirement savings gap.

For many superannuation funds, the member engagement journey has been a long campaign. However, many question whether the effort has been cost-effective given the large numbers of members who remain unengaged.

Rice Warner recently placed into the market some ideas for developing joint superannuation accounts. The basic thinking on this can be found in Rice Warner’s recent newsletter. The pros and cons of joint accounts are argued in the newsletter, including the key question: why can’t the 7 million families of working age pool their superannuation into a joint account?

The most important message in this is that a joint account system, easily implemented, has the potential to truly lift engagement levels by members.  Couples will be interested in their combined superannuation outcome.

If two thirds of Australians are in a marital relationship at retirement age, it simply makes sense that they would be looking at life post-retirement through the lens of their combined net wealth (including any eligibility for a couples Age Pension).

The trick is to boost the amount of engaged planning during the accumulation phase by targeting the family finances, and the joint account may well deliver a neat solution. In any event, raising engagement levels is a difficult enough task, even with the array of tools at the industry’s disposal (financial advice, online calculators, sophisticated direct marketing and other communications methods).

An industry push with Government and other stakeholders towards creating a workable joint account system may well open up a practical new front in the long engagement campaign.

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