Even the World’s Most-Envied Retirement Plan Is Falling Short
The US and UK see Australia’s A$3.7 trillion private pensions as an example for the wealthy world, but most retirees there still have much less than they’ll need.
Australia’s now-celebrated retirement system—officially, the Superannuation Guarantee—was codified in 1992, after contentious wage negotiations between the country’s biggest unions and employers.
Photographer Antonin Cermak/Fairfax Media/Getty Images
Between BlackRock’s Larry Fink and UK Chancellor Jeremy Hunt, it's official: Australia’s A$3.7 trillion ($2.4 trillion) retirement system is the envy of the wealthy world.
In his budget speech to Parliament in March, Hunt cited Australia’s private pensions, known as super funds, as delivering “better returns for pension savers with more effective investment strategies.” Three weeks later, in his annual letter to investors, BlackRock’s Chief Executive Officer directed American policymakers to “study and build on” Australia’s model, suggesting it could be an antidote to the deeply stressed US Social Security system.