There is a key reason why compulsory super remains trusted and popular with the public and that’s because it has quietly revolutionised living standards in retirement for millions of everyday Australians.
One key figure in a new report we launched this week illuminates its impact: retirement wealth for middle Australia has tripled over the past 20 years, with superannuation the central driver of that transformation. Between 2002 and 2022, non‑housing wealth for middle‑wealth retirees grew by 196 per cent, leaving them more than $256,000 better off in retirement. That is not a marginal improvement — it is a structural shift in who gets to retire with security and dignity.
The impact is even clearer when looking at income. Average retiree income from super for middle Australians has more than doubled, rising from around $340 a week in 2002 to $740 a week in 2022, in wage‑adjusted terms. That additional income is paying for the essentials — and increasingly, the small comforts — that define a decent retirement.
Crucially, this uplift has occurred despite long stretches of weak real wage growth. Over the past three decades, net returns delivered by profit‑to‑member super funds were two times higher than wage growth, allowing Australians to build wealth even when pay packets stalled. Long‑term capital growth through super has cushioned households against volatility and cost‑of‑living pressures in retirement.
Super has also reshaped the economy itself. By pooling savings at scale, funds have broadened household wealth beyond property and cash, giving ordinary Australians access to returns from companies, infrastructure, property and private markets. The ability to invest patiently and over the long term has helped funds ride out shocks — from the GFC to COVID and more recent global volatility — while continuing to deliver real returns for members.
There is a clear policy lesson here. Super works because it is compulsory, preserved and invested for the long term. Any erosion of those principles risks undermining the very outcomes now being realised by retiring Australians — and shifting costs back onto households and future budgets.
Analysis by Frontier Advisers for the Council found that if preservation rules were removed or relaxed, net returns could be lower by 0.3 – 0.6% each year, leaving the average Australian with between $150,000 and $300,000 less in super at retirement.
Three decades on, the evidence is in. Superannuation is no longer a promise about the future. For many, it is already delivering the lift to living standards in retirement that it was designed to do.
