The latest investor research performed by a global fund manager has shown the COVID-19 pandemic has changed the attitudes of individuals with regard to their approach to retirement.
The “Schroders Global Investor Study 2021” revealed the coronavirus has prompted Australians to save more than the superannuation guarantee defined compulsory 10 per cent of their salary for their retirement years.
“Australian investors are indicating that they want to save more towards their retirement than the mandated 10 per cent, with people who are saving more, saving on average 15.1 per cent from their income, which is actually a pretty high number,” Schroders Australia chief executive Sam Hallinan observed.
Further, nearly half of the survey participants in Australia indicated the pandemic has made their attitudes regarding the drawdown of their superannuation more conservative, with 47 per cent of this cohort admitting they are more cautious with spending their retirement savings.
The report also showed COVID-19 has had less of an impact on individuals who are already in retirement.
“The majority of retired Australians noted that [despite the COVID-19 pandemic] they would have retired at the same age (81 per cent),” Hallinan said.
With regard to investment returns, the study revealed Australian investors are expecting to make an average total return, from both capital gain and income, of 10.6 per cent over the next five years.
“This is in line with what they have been making more recently, which I guess underpins their expectations, but from our perspective it certainly seems unrealistic when you view it against current market conditions,” Hallinan noted.
In terms of income generated from investments, Australian participants expected to receive an average minimum return of 8.7 per cent over the next year.
The “Schroders Global Investor Study 2021” was commission in March and analysed responses from over 23,000 people from 32 regions across the world who were looking to invest around A$15,000 in the next 12 months.
