Anne Fuchs: Hello and welcome to Super Insider, a podcast on all things investing, the economy, superannuation and retirement, proudly brought to you by Australian Retirement Trust. I'm your host today, and my name is Anne Fuchs. I'm the Executive General Manager of all things advice, guidance and education here at ART. I'm thrilled today to be bringing somebody to you who is an expert on the world of superannuation and its positive impact on our society.
But before I do that, I want to remind you that this is general advice and information only. Please don't act on anything you hear today without calling your super fund or getting some financial advice.
I'm thrilled to introduce Misha Schubert, the CEO of the Super Members Council and the voice of Superannuation in Australia. Misha, welcome to the show.
Misha Schubert: It's super great to be here. Thanks for having me, Anne.
Anne: Was the pun intended?
Misha: Absolutely. Super is one of those great adjectives and nouns that can be deployed in so many ways. Australia has really leaned in on the comms opportunity to call it 'super' because it is super; it transforms people's lives in a whole host of ways that we'll dig into in the course of our chat today.
Anne: Tell me about your job as the CEO of SMC. I'll just use the acronym because Super Members Council is a bit of a mouthful.
Misha: Indeed. It's my great privilege to be the chief advocate and voice for 11 million everyday Australians who have their retirement savings safeguarded in the super system, especially in profit-to-member funds. So, they're the super funds where, if you've got your funds invested with them, they exist for one purpose and one purpose only, and that's to deliver their members the strongest possible retirement. Australian Retirement Trust is part of that network of profit-to-member funds in our country.
Our role is to be that voice inside the policy-making processes of Canberra, to deal with parliamentarians of all different stripes and varieties, to talk with the policy-makers who set the laws, policies and regulations that affect how our super can grow collectively as Australians, and to make sure that that vantage point, the experiences of people who've got their savings in the system, is absolutely front and centre in all of those processes where new laws are being contemplated or policies are being made.
We've got a really important purpose to work above and across politics and to speak with people of all walks of life in the parliament, to make sure that everyone understands the power of super in people's lives, how it's already transforming the dignity of retirement for a couple of million Australians who have already reached that golden point of retirement.
However, we have millions of other Australians who are saving week in, week out whose savings are growing through the magic of compound returns inside their super and keeping the system fundamentals really strong and secure to keep super doing its magical work for us all is our role.
Anne: Misha, I'm guessing you're a Gen X-er like me, because we're the first generation that have had super our whole working life. I've got over 50 first cousins. My mum is one of 10 and dad is one of seven. They both had to finish school, and most of my aunties, uncles, and parents didn't have retirement savings because super wasn't paid to the average worker back then. I think about the difference in how we'll retire compared to certainly my aunties and uncles. I don't know what your family story is, but can you relate to that?
Misha: Absolutely. I am; guilty as charged on the X-er front. Although my children do occasionally like to tease me and say, 'Okay, Boomer.'
Anne: You're not a Boomer. I'm sure you've got a great Gen X playlist they steal from you on Spotify.
Misha: That's it, yes. It's all retro again. It's all come back into vogue thanks to a hit Netflix series.
Yes, absolutely. That's totally my family's lived experience. I know that's the same for millions of everyday Australians. I've had super through my working life. I've seen it start to grow and grow, and then I watched that snowball effect, where it starts to grow faster and faster as you have money in it. With each year that passes, those returns start to earn returns. But it was really different for my parents' and my grandparents' generations.
My grandmother lived on the far west coast of South Australia. She was a remarkable woman and raised 4 daughters for large periods on her own. I think about what a difference it would have made to her life to have super in that era. My parents are from that generation. They're now retired. They're a very representative sample of many of today's retirees, who have had that uplift from having some super on top of the Age Pension, and that's made a big difference from just living on the Age Pension alone.
I can already see what a difference it means. Being able to say, 'I want to come and see the grandkids' and know you can afford to do that from time to time without having to really worry or put it off for years and years if you live interstate, or knowing you've got that help paying the bills when the utility bills and other things come in. It's just transformative to Australians' lived experiences.
Anne: You referenced a Netflix series, which I won't mention, but Blame It on the Rain is a big song by Milli Vanilli.
In 1992, when superannuation was legislated, the Australian stock market was much smaller because Australians as a collective were not shareholders, and only the really wealthy people had shares, investments, and that type of thing. What do you think superannuation has done in terms of democratising share ownership for the economy as a whole and society?
Misha: It's absolutely been a game-changer. When we think about why it's been a game-changer and how it's been a game-changer, it's a story we should tell ourselves again and again, and we need to tell our kids because about three-quarters of the Australian workforce today were not in the workforce here in Australia at the time those Super Guarantee laws were passed in 1992, as you say, with Billy Ray Cyrus tearing up the charts. Then Prime Minister Paul Keating gave a speech to a bunch of UNSW students saying, 'You don't want to be on the hook for paying for my generation's retirement, so we've got to do this systematised way of helping us all build savings for retirement.'
And that's what super is. But we've done it in a really clever way. I'm often struck when you hear foreigners, governments, industry and capital leaders in other countries look at Australia and say, 'You've built something that is truly the envy of the world' because it's universal. It's meant to cover all of us who are working throughout our lives. It's compulsory. It's not a choose-your-own-adventure; it's a part of your legal entitlements when you work. It's preserved to that magic age of 60 when we reach that preservation age on the way to retirement. That preservation age enables that magic of compounding returns to work and to see our savings grow.
You're absolutely right to call out what it means for us as a nation and the ability of everyday Australians to have a little slice of ownership in Australia's businesses and infrastructure in our community. Today, Australians are a nation of mum and dad shareholders through the magic and power of super. All of us own a little bit of things like some of the biggest companies and the stocks and shares they have that generate those strong returns year after year. We're all a little more directly invested in the economy. The strength of it is that none of us have to sit there trying to build our own little portfolio and logging in twice a day to a share trading app to try to make those judgements on our own. Our money is automatically saved. It goes into our super fund, and it's put under the care and stewardship of some of the best investment minds anywhere in the world.
Anne: A 100 per cent.
Misha: Those investment teams are the ones who make those big, clever calls on our behalf to get us those strong returns that we're seeing. It's been a miracle. I often like to say super is your financial superpower, and super is Australia's economic superpower.
Anne: Misha, it's not all rainbows and butterflies. There are still vast differences between men and women regarding retirement, challenges with people in casual work or interrupted work patterns and low-paid workers. Is there anything you're advocating for as the chief advocate of SMC to help create a dignified retirement for all Australians regarding super?
Misha: Absolutely. We are on it. As you say, super has been remarkable for so many Australians, everyday people to build that nest egg for retirement. Before the system was created, average Australians did not have a super. Now, 9 in 10 people who have been through the workforce have coverage of super.
As you say that system has been powering up from a low base over the 30 years of its creation. But we're mindful that we must bring the full promise of super's potential to every Australian. There are pieces of that work that we still need to do. Women still retire with about a quarter less savings by the time they hit retirement than men. The win we've had this year collectively on adding super payments to paid parental leave that the Commonwealth offers will make a big difference to 180,000 families. Most of them are women, year on year from hereon in. We know the gender gap widens in the 30s when we've looked at the data. We're also doing a really clever piece of work around the broader experiences in women's lives that contribute to that gender super gap, and we're looking forward to bringing forward a piece of work next year to advocate some further change on that front.
We're looking really closely at retirement and what it means for people and whether we can make the system in the retirement phase simpler and easier for people to navigate and unlock the next stage of the financial advice reform so that people can get a bit more info from their own super fund about their super is really very much in our viewfinder at the moment. As you say, other demographic groups are looking to make further recommendations about how we advance savings for all demographics across our community so that every Australian can enjoy that full promise of super.
Anne: Misha, we've been around Australia with the big blue monster. You might have noticed him, Artie. We thought that not enough Australians were awakening to their super. They're not paying attention to it. We're trying to do something really different and bold so that people start paying attention to this precious asset: their money. What is your advice, as we finish this podcast episode, to listeners about what they should be doing to take control of their super?
Misha: Being super smart and super engaged is the best advice.
Anne: What does that mean?
Misha: So, really trying to help your kids and your grandkids be engaged and involved in their super from day 1 when they start getting paid super. What does that mean? Maybe as a teenager or in your early 20s, you might have picked up numerous casual jobs. One really easy, simple thing you can do is make sure you've got that super all in the one super account. So, talk to your super funds and see how to consolidate that money. That is one important tip for people to think about doing.
Being able to check your balance is another important thing. We see a really important role for the Super Members Council in helping more Australians understand the basics of super and being more engaged with it. Download your app and check your balance. About a third of Australians check their super balance less than once a year. It's really hard to keep on top of making sure that you're getting paid your full legal entitlement to super if you're only checking it that infrequently.
The technology has been a game-changer now. Being able to download an app or check in on an online balance has made it a much different proposition than waiting for a statement in the mail every so often. Talking to your fund is the other key thing I'll often say to people. Ring up your super fund and ask for some tips about what you should think about at various life stages. If you've more complex needs, they can hand you off to a fully qualified advisor to deal with them. But for many people, their needs are pretty simple and straightforward. So, engage and make sure that you're getting paid that full amount.
We've got a lot of advocacy we're engaging in about making sure that the unpaid super that's not being paid to people is being paid into their super accounts. We know that $5 billion was not paid to 1.8 million Australians on record last year, for which there's data. So, we're advocating for payday super reforms to make sure that it becomes the law that your super has to be paid.
Anne: They're entitled to. Yes.
Misha: That's it. And it makes it easier to check, you know, the amount on your pay slip. You can jump into your app a week later and make sure that that money is there on time and in full. It's really important to pay attention, be engaged, and ask for that next step of help and advice from your fund.
Anne: Thank you so much, Misha, for all the work you do, advocating for all Australians so that they can live their retirement without having to worry about money. Superannuation is an amazing thing. It should be one of the greatest policies -- well, it is one of the greatest policy achievements that Australia has had and, as you rightly say, the envy of the world. Thank you for dialing in from -- are you in Canberra?
Misha: I am in the nation's capital on a very sunny day. And you're right, no one will ever get to retirement and think, gee, I wish I had less money. They're going to say, 'Thanks past me for having this money in super and for keeping it strong and intact'. So, thank you for your time today.
Anne: No, thank you. Thanks, SMC. And thank you to our listeners and viewers. Please make sure you give us a rating. Please subscribe. Tell your family and friends, and we'll look forward to you joining us again soon.
This transcript has been edited for length and clarity.
