Superannuation funds in Australia are under scrutiny for their failure to effectively communicate with retirees, leaving millions of Australians potentially unprepared for their financial future. According to a recent review by the Australian Securities and Investments Commission (ASIC), there is a “glaring retirement communications gap” that may hinder many retirees from making well-informed decisions. With the “retirement wave” already beginning to hit, the need for better, more personalised communication has never been more urgent.
As more Australians approach retirement, the consequences of this communication failure could be severe. A growing concern is that retirees, who often hold large superannuation balances, may not have the tailored information and support they need. In a period of financial uncertainty, this lack of clarity can result in poor decision-making, potentially undermining the retirement security of millions.
ASIC Highlights Widespread Communication Failures
ASIC’s recent review of 12 superannuation funds—responsible for managing assets worth over $1 trillion—found that many funds still follow a “one-size-fits-all” communication model. According to the regulator, this approach is insufficient for those already in retirement, whose needs are far more complex than those preparing for it.
The review highlights that many funds focus their efforts on pre-retirees, neglecting those who are already navigating the retirement phase. As ASIC Commissioner Simone Constant pointed out, over 1.5 million members are already in retirement, collectively holding approximately $575 billion in superannuation assets.
Despite this, many super funds still fail to provide targeted support for these individuals, opting instead for generalised advice more suitable for younger members. This lack of specificity could be costly for retirees who require nuanced guidance to effectively manage their funds.
Vulnerable Groups Left Behind
An additional issue identified in the review is the insufficient focus on vulnerable groups within the superannuation system, including First Nations communities and people from culturally diverse backgrounds. According to ASIC, none of the funds under review had tailored retirement communications aimed at these groups. This oversight could leave some of the most financially at-risk individuals without the information and support they need to navigate retirement.
The failure to engage vulnerable groups is particularly concerning, as these communities often face unique challenges when it comes to financial literacy and planning. ASIC has called on super trustees to rethink their approach and develop communications strategies that cater to the diverse needs of their members, ensuring that retirees, regardless of background, are provided with meaningful, accessible, and timely information.
The ASIC review concludes with a clear call to action for super trustees: provide more personalised and accessible communication that meets the needs of retirees, particularly those in vulnerable groups. Trustees must ensure they are not just meeting regulatory obligations but actively working to improve member outcomes. Effective communication will be key to maintaining trust and ensuring that Australians can confidently approach their retirement years.
