Australia Superannuation Market

Australia Superannuation Market Overview:

The Australia superannuation market size reached USD 80.0 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 150.0 Billion by 2033, exhibiting a growth rate (CAGR) of 7.22% during 2025-2033. The market is driven by several factors, such as mandatory contributions from employers, a steadily expanding aging population base, increasing financial literacy among individuals, and favorable government policies promoting retirement savings.

Australia Superannuation Market Trends:

Mandatory Employer Contributions

One of the major drivers of the Australian superannuation market is the compulsory employer contributions mandated by the government. Under the Superannuation Guarantee, employers must contribute a fixed percentage of their employees' salaries into superannuation funds. This system has created a steady inflow of funds into the superannuation market, significantly boosting its growth. These contributions ensure that employees have retirement savings, fostering a consistent increase in fund assets over time. For instance, according to industry reports, the Australian superannuation industry, valued at AUD 3.5 trillion, is a significant player in the local investment landscape. Super funds are increasingly diversifying into non-traditional assets and exploring global opportunities. As contribution rates continue to rise, the market is expected to expand further.

Aging Population and Retirement Planning

Australia's aging population is another significant factor driving the superannuation market. According to the Australian Bureau of Statistics, the number of Australians aged 85 years and over is expected to double by 2042, surpassing 1 million people. This age group could represent 3% of the population. Additionally, the population aged 65 years and over will nearly double, reaching between 6.4 to 6.7 million by 2042. As the population ages and more individuals approach retirement, the need for retirement planning and adequate savings grows. The superannuation system plays a crucial role in ensuring Australians have enough funds to support their retirement years. As life expectancy increases, individuals are looking to optimize their superannuation investments for long-term financial security, which boosts market activity. This trend is expected to continue as the demographic shift toward an older population intensifies. For instance, in July 2024, Australia raised its superannuation guarantee rate from 11% to 11.5%, benefiting workers by increasing their retirement savings. This incremental rise is set to reach 12% by July 2025.

Government Policies and Tax Incentives

Government policies and tax incentives have played a pivotal role in shaping the superannuation market. Various tax advantages, such as concessional tax rates on contributions and earnings, make superannuation a tax-effective way to save for retirement. Additionally, government co-contributions for lower-income earners and incentives for voluntary contributions encourage individuals to maximize their superannuation savings. For instance, in March 2024, the Albanese government, the federal executive government of Australia, announced that from July 2025, eligible parents will receive an additional 12% superannuation on their government-funded parental leave. This initiative aims to close the retirement savings gap between men and women, as women typically retire with 25% less super than men due to time spent out of the workforce for caregiving. The policy, expected to cost $250 million annually, reflects the government’s focus on gender equality. Moreover, the Fair Work Commission in January 2024 recommended changes to the laws allowing people with disabilities in supported employment to receive lower superannuation rates than other workers. Currently, these employees receive 9.5% super, while the rest of the workforce gets 11%. The proposed change would align the super rate with the national standard, reflecting updates to superannuation laws. These policies not only stimulate higher contributions but also promote long-term investment growth, further driving the expansion of the superannuation market in Australia.

Australia Superannuation Market News:

• In May 2024, AustralianSuper announced that they have made significant advancements in its withdrawal process. Post adjustments, the success rate for online withdrawals increased by 10%. Support calls related to withdrawals decreased, resulting in an estimated annual savings of $800,000. These enhancements have streamlined the experience for all members, reflecting AustralianSuper's commitment to continuous system improvements.

Australia Superannuation Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the country level for 2025-2033. Our report has categorized the market based on types of superannuation funds, and investment strategy.

Types of Superannuation Funds Insights:

• Industry Funds
• Retail Funds
• Corporate Funds
• Others

The report has provided a detailed breakup and analysis of the market based on the types of superannuation funds. This includes industry funds, retail funds, corporate funds, and others.

Investment Strategy Insights:

• Growth Funds
• Balanced Funds
• Conservative Funds
• Cash and Fixed Interest Funds
• Others

A detailed breakup and analysis of the market based on the investment strategy have also been provided in the report. This includes growth funds, balanced funds, conservative funds, cash and fixed interest funds, and others.

Regional Insights:

• Australia Capital Territory & New South Wales
• Victoria & Tasmania
• Queensland
• Northern Territory & Southern Australia
• Western Australia

The report has also provided a comprehensive analysis of all the major regional markets, which include Australia Capital Territory & New South Wales, Victoria & Tasmania, Queensland, Northern Territory & Southern Australia, and Western Australia.

Competitive Landscape:

The market research report has also provided a comprehensive analysis of the competitive landscape. Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided.

Australia Superannuation Market Report Coverage:

Key Questions Answered in This Report:

• How has the Australia superannuation market performed so far and how will it perform in the coming years?
• What is the breakup of the Australia superannuation market on the basis of types of superannuation funds?
• What is the breakup of the Australia superannuation market on the basis of investment strategy?
• What are the various stages in the value chain of the Australia superannuation market? 
• What are the key driving factors and challenges in the Australia superannuation?
• What is the structure of the Australia superannuation market and who are the key players?
• What is the degree of competition in the Australia superannuation market? 

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Australia superannuation market from 2019-2033.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the Australia superannuation market.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Australia superannuation industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.