The survey found that Australians are more curious about investing than in previous years, yet many still overlook one of the most powerful investment tools they already own – their super.
It revealed that while 54 per cent of Australians consider their super to be an investment, this drops to 48 per cent among those under 50.
Additionally, engagement is also “strikingly” low with less than half of Australians (46 per cent) actively choosing how their super is invested, while one in four remain in their fund’s conservative default option, and nearly one in three (29 per cent) don’t know how their super is invested at all.
Furthermore, the survey revealed that non-super portfolios are heavily concentrated in cash-style products, with high-interest savings accounts (30 per cent) and term deposits (20 per cent) making up more than half of their holdings.
The analysis of the results found that many view these as investments despite the fact they are savings vehicles that struggle to keep pace with inflation and are not designed for long-term wealth creation.
Craig Day, head of technical services at CFS, said the research highlights a simple truth that super is one of the most effective ways to build wealth, but too many Australians don’t see it as an investment.
“When people stay in the status quo, whether that’s remaining in a conservative default option or a single asset, they risk missing out on significant long-term growth,” Day said.
“The consequences may not be visible now, but compound over time.”
While the bias towards property remains strong, the research found that younger investors are shifting with only 11 per cent of Australians under 50 expecting property to be their largest investment in retirement and half the level of those aged 50–64 (21 per cent). This shift comes even as many continue to overestimate long-term property returns.
Day said this recalibration is healthy, adding that property confidence is understandable, but concentration risk, like having all your wealth tied up in one asset like a house, can limit flexibility.
“That can have a huge impact, particularly for older Australians, if life takes an unexpected turn,” he said.
“By diversifying across asset classes whether through equities, fixed income or cash, either directly or through managed investments, you spread your risk, which can lead to more stable returns over time.”
Day continued that superannuation works best when people actively engage with it, checking how it’s invested and making sure that choice is appropriate for life stages and time horizons.
“This is essential to maximising your financial position at retirement. Professional advice can further strengthen your strategy and ensure it stays on course,” he added.
Additionally, the research found that outside of super, more Australians are becoming interested in investing but are hesitant to begin due to fear, uncertainty or a lack of knowledge.
It found respondents were most concerned about “getting it wrong” and losing money (42 per cent). Other factors preventing non-investors from making a start were uncertainty about where or how to begin (26 per cent), and a wariness of market volatility (31 per cent).
Common to both non-investors and investors was a lack of confidence in making independent investment decisions.
Day added that a “set and forget” mindset can lead to missed opportunities in regard to building wealth in superannuation.
He said a 25-year-old who shifts into a higher-growth option early in their working life and then moves to a balanced option later could retire with around $200,000 more than someone with the same contributions who stays in a balanced option the whole way through.
“It’s a powerful reminder that small decisions made early can compound into very large differences over time,” he said.
“Small decisions, made early and reviewed over time, can materially lift retirement wealth. At the very least check investment options, take a look at fees, perhaps make an additional contribution. Even $20 a week can make a major difference to a retirement balance over the long term. Don’t just leave it and do nothing.”
