New data from the latest AMP retirement adequacy report has shown a significant shift away from post-tax contributions towards pre-tax salary sacrifice in older Australian workers.
This switch in voluntary contributions behaviour is most significant in the 55-plus age category.
The latest figures highlight an emerging trend of salary sacrifice, with 30.4 per cent of people in the 55-69 age bracket contributing to salary sacrifice in the December 2008 quarter.
This is in sharp contrast to only 7.3 per cent in the same age group contributing to post-tax super.
The present figure of 7.3 per cent shows a continual downward drift from an approximate 15 per cent contribution to post-tax super by the same age group in 2006, to 13 per cent in 2007, and finally to 7.3 per cent in 2008.
This decline in post-tax contributions indicates that emerging transition-to-retirement strategies involving salary-sacrifice arrangements are gaining popularity and are fast becoming a key attraction for pre-retirees.
Conversely, younger workers who are more likely to qualify for the federal government co-contribution have been shifting away from pre-tax salary sacrifice towards after-tax contribution.
Overall, voluntary contributions from members of all age groups combined fell only slightly, remaining close to figures seen earlier in 2008 and suggesting a bottoming out in the fall in contributions.
The AMP Superannuation Adequacy Report used data for the six months to 31 December 2008 from more than 322,000 AMP corporate superannuation clients to predict retirement adequacy based on 65 per cent of an individual's pre-retirement living standards.
