Irene Guiamatsia

Around two-thirds of non-retirees don’t feel prepared for retirement and almost half are reluctant to use their super fund’s pension product, according to findings from Investment Trends.

The findings come amid super trustees obligations to offer a retirement strategy under the Retirement Income Covenant, which the government and regulators recently lambasted industry lethargy towards providing adequate solutions.

Speaking on a webinar on Wednesday, Investment Trends head of research Irene Guiamatsia said 37 per cent of non-retirees felt prepared for retirement while two-thirds are unprepared.

“This is a 10-year low,” Guiamatsia said.

Additionally, the research found that 45 per cent of non-retirees are reluctant to use their super fund’s pension products, and specifically said they believe these products do not meet their retirement needs.

“What we’re seeing here is a significant proportion of members lack confidence when it comes to retirement, and some of them are certain that super funds cannot meet their retirement needs,” Guiamatsia said.

Despite the plans for the Albanese government to use the Quality of Advice Review as a vehicle for super funds to give more financial advice, the Investment Trends research found only 1 per cent of members are utilising the intra-fund advice offering available from their super fund.

“This is perhaps slightly alarming that the average age of those advised members is 52 years old where one could argue it’s a bit too late depending on the individual circumstances,” she said.

Despite the low take-up, the research also found members were willing to take more advice from their super funds.

“Close to 30 per cent expressed a preference for an adviser from their super fund that they already have a trusted relationship with,” she said.

“The data is abundantly supportive here of the verticals [vertical integration] that we’ve heard of late from the minister, calling for super funds to deliver advice.”

The research found the average cost to provide intra-fund advice was $9 per member subsidized across the whole membership base but is actually $762 per member who accessed advice.

For intra-fund and comprehensive advice, those figures were $17 and $707, respectively.

Guiamatsia said there is still the necessity for a holistic strategy that extends beyond merely focusing on advisory aspects or product features in isolation, however.