The Superannuation Guarantee is the amount your employer has to pay into your super fund on your behalf. The purpose of super is to provide income in retirement to substitute or supplement the government age pension, so the rate of the Superannuation Guarantee should be set at a level that will provide enough income to provide a comfortable retirement for most Australians.

At the moment, the Superannuation Guarantee is set at 9.5% of your wages, and the federal government has legislated that it will increase steadily to 12% by 2025.

The legislated increase in the Superannuation Guarantee to 12% SG is important for the retirement outcomes of millions of Australians. Without the increase, many workers will retire without adequate savings for a comfortable retirement. The government has already stopped planned Superannuation Guarantee increases twice before, and there continues to be commentary calling for Superannuation Guarantee to be ‘frozen’ at 9.5%.

What freezing the Superannuation Guarantee would mean for you

We calculated the effect the Superannuation Guarantee freeze would have on a hypothetical member’s retirement balance. Our hypothetical member, Nicola, has $95,000 in her account and was 45 years old on 1 July 2020.

If the Superannuation Guarantee doesn’t get frozen

If the Superannuation Guarantee increases proceed as legislated, in today’s dollars Nicola will have $358,538 when she reaches 67.

If the Superannuation Guarantee is frozen

If the government decides to leave the Superannuation Guarantee rate at 9.5% it will cost Nicola – she’ll only have a projected $319,762 in her account when she reaches 67. That would mean the government’s super freeze would cost Nicola $38,776.

What would an extra $38,776 in your super mean to you?

If you have any questions, please contact Paul Filia either at or on 0417 014 945.

Assumptions: returns are 6.2% (net of fees and taxes), CPI & Cost of living 4% which is consistent with ASIC’s MoneySmart assumptions. Please remember that past performance is not a reliable indicator of future performance.  * Today’s dollars.

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