POWERED BY MOMENTUM MEDIA
Gen Y must adopt long-term saving habits: REST
Contrary to accepted wisdom, members of Generation Y have good short-term saving habits - something that super funds can leverage off to improve member engagement, according to REST chief executive Damian Hill.
A white paper commissioned by REST that surveyed 752 18-35 year olds found that younger people were accruing debt earlier in their lives than previous generations, and were accumulating assets (such as property) later in life.
However, over one-third (36 per cent) of Gen Y do not own a credit card or a store card, and almost 80 per cent report that they are saving some money each month. In addition, 32 per cent of 18-35 year olds are living at home with their parents, leading to a greater ability to save money.
But the good saving habits are usually for a short-term goal such as travel, according to Hill.
"Generation Y could be using the savings they are putting away to make their money work harder for them … they could benefit from taking a longer term attitude to savings, particularly retirement savings," Hill said.
With over 50 per cent of REST's member demographic represented by the people surveyed, Hill said the white paper would allow his fund to "understand our members better so we can serve them well".
Since Generation Y have the basics of saving "down pat", super funds can leverage off that knowledge by looking at more innovative mediums and channels (such as social media and videos) to engage 18-35 year olds, Hill said.
It is also important to increase the financial literacy of Generation Y, he added.
"Education should cover a range of areas, from short-term goals - such as travel - through to how to repay debt as quickly as possible, plan a budget or select a super fund," Hill said.
Recommended for you
The two funds have announced the signing of a non-binding MOU to explore a potential merger.
The board must shift its focus from managing inflation to stimulating the economy with the trimmed mean inflation figure edging closer to the 2.5 per cent target, economists have said.
ASIC chair Joe Longo says superannuation trustees must do more to protect members from misconduct and high-risk schemes.
Super fund mergers are rising, but poor planning during successor fund transfers has left members and employers exposed to serious risks.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
88.01 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
72.60 3 y p.a(%)
3
Global X GlobalX FANG+ ETF
44.46 3 y p.a(%)
4
Pengana High Conviction Equities B
39.12 3 y p.a(%)
5
Pengana High Conviction Equities A
39.05 3 y p.a(%)
