Unintended externalities of Super

Been chatting to someone working in wealth. Apparently, Australians came out well ahead of many other OECD nations post COVID (so far). Reason? It turns out the forced saving of Super meant that as a nation, on average, Australians benefited from all the money pumped globally more than others.

The example given is that average Australian saving is 2.5x that of an average American. And since a big chunk of Super is invested overseas, we didn't just benefit of uplift within our borders, but pretty much got a slice of whatever other governments are pumping. And because savings here are on average larger than other OECD members (Switzerland and Norway excepted for example), this windfall was more equally distributed across the nation and it also means that we got ahead compared to others.

Whoever came up with super idea, I am sure didnt think of this particular scenario. But I say, kudos to them.

 

That would apply to most people with industry or retail funds who have opted for the default option or the more aggressive options (many funds have 20-30% exposure to overseas equities).

Those with SMSF invested in a single property or moved to conservative options will have missed out.

 

This is an great point. I am beating myself I didnt think about it, cause could have been a good way to ask. I assume there is a "flow on" effect, rising welath means more spent, means increase in property prices... so on.

Conservative or cash. Is spot on as well, cant argue with that.

From quick look, SMSF is still a tiny proportion of total super (about 7% of funds), so seems the logic still holds.

 

So came across this on ATO website. The positive, seems like most of the states are on the same footing other than NT.



Any thoughts on balances? I was expecting to see larger amounts to be honest.