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SMSF contributions up 15 per cent
Self-managed super fund (SMSF) contributions increased by 15 per cent for the 2010-11 year, representing an increase of $3 billion according to the Financial Services Council's Bond report on SMSFs.
Members contributed $24 billion into SMSFs over the year with discretionary contributions increasing 19.8 per cent to $24 billion between 2009-10 and 2010-11 and employer contributions growing by 4.9 per cent to $6.8 billion.
Financial Services Council chief executive, John Brogden said the rebound in discretionary contributions was triggered by an improvement in economic growth and investor sentiment.
Following three years of consecutive downturns, net flows to SMSFs increased by 22.5 per cent or $2.8 billion to $15.4 billion in 2010-11. In June 2012, SMSFs had $438.9 billion under management.
AMP's latest retirement adequacy index showed that Australian's retirement adequacy had fallen to its lowest levels since the Global financial Crisis off the back of a drop in voluntary contributions.
Adequacy levels fell 2 per cent while retirement savings fell 7 per cent.
At 12.3 per cent of salary, the average worker's contribution rate was below the 12.6 per cent of salary members were contributing as of December 2006.
AMP said the lack of voluntary contributions threatened the positive impacts of the government's intended 9-12 per cent compulsory contributions rate.
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