In the digital age, Australian super funds are facing profound changes on multiple fronts that are transforming superannuation as we know it.
Demographically, the membership base of super funds is becoming more diverse and broadly distributed than ever before. As a result of compulsory employer contributions, new job starters are beginning to accumulate retirement savings at a much younger age, building higher balances much earlier in their lives. The rise of the millennials is creating a new tech-savvy cohort of members that expect tailored offerings and mobile, digital interactions in real-time. Concerned about whether they will have sufficient funds in retirement, the Gen Xs are increasingly in search of advice. And as large numbers of baby boomers transition into retirement – with better health, increased longevity and substantial retirement savings – industry attention is shifting to the underdeveloped post-retirement space.
Against this backdrop of sweeping demographic change, we are witnessing a consumer revolution that is forever changing the dynamics of member relationships. More confident and assertive, today’s members are demanding increasingly sophisticated and personalised servicing that meets their individual circumstances at any given moment. They want flexible offerings that can be easily adapted throughout their lifecycle to reflect changes, such as their capacity to save into their super, their risk appetite and investment needs, and their communication preferences. Demand for online advice is also increasing, as members expect funds to play a greater role in helping them to meet their retirement savings goals, ensure these savings last the distance and plan and fund their future health and aged care needs.
On the technology front, innovations from software specialists and fintechs are transforming the ability of super funds to meet this new wave of member expectations and conduct all aspects of funds administration. There is growing consensus that funds must transition to system capabilities that support the tenets of modern service delivery. To a large degree, real-time digital offerings, the application of big data and analytics to achieve true customer centricity, seamless integration both internally and with third-party providers, effective risk and compliance management and greater operational efficiencies– are all dependent upon funds having the right technology in place.
While this rapidly evolving landscape presents considerable challenges to super funds as they seek to respond to multiple issues with limited resources, it also brings significant opportunities for them to grow their market share. Half the battle for funds is knowing which developments they should focus their energies on and which are mere distractions.
To help funds navigate their way forward, this whitepaper identifies the 10 major trends that Australian superannuation funds cannot afford to ignore in the years ahead. It explains how these trends are reshaping the industry and the key role modern technology systems will play in supporting funds to adapt and respond, and ultimately achieve future business success.