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Australians want to do more with their money: Research

By Keeli Cambourne
May 24 2023
1 minute read
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The most recent SMSF statistics from the ATO showing younger people are establishing self-managed funds at a greater rate than their more senior contemporaries is supported by new research from Insignia Financial’s inaugural Financial Freedom Report.

The report shows that more than half (58%) of Australians want to manage their money better, and 63 per cent are dedicating more focus to increasing their financial knowledge compared to 12 months ago.

The report highlights the importance of financial literacy and accessible financial education tools, with a third of Australians (31%) reporting they received no financial literacy education in their childhood.


It also found that younger Australians - Gen Y and Gen Z - are the most likely generations to spend time on increasing their financial knowledge in the past 12 months, spending more than twice as much as their Baby Boomer contemporaries (82% to 38%).

According to the research, younger generations are the most likely to agree they want to manage their money better (70% Gen Z, 70% Gen Y cf. 56% Gen X, 36% Boomers) while Gen Z (13%) are the most likely generation to build additional income streams.

Previous data from AUSIEX shows that Gen Y and Millennials remain the fastest-growing segment of new SMSF account holders, and there has been an emerging trend of more accounts opened by Gen Zs, with their numbers doubling in 12 months.

AUSIEX chief executive Eric Blewitt said regulatory reviews of the super system have contributed to more people wanting to take greater control over their retirement savings.

“SMSFs may be appealing to younger people because they provide greater control over investments,” he said.

The trend is also being driven by the ease of access to trade shares both local and overseas.

The Annual Benchmark Report by SMSF software firm Class, found that for the 2021 financial year there were 12,413 net establishments of SMSFs compared with just 233 in 2018.

The average age at establishment also fell from 51 years between 2006 and 2014, to 46 years between 2020 and 2022 while the 35–44 age group is the most popular in which to establish an SMSF.

The Class data also noted there had been a significant spike in fund establishment during FY22 for funds with balances of less than $50,000.

“We’re seeing first-hand that younger people are more active in making decisions relating to their super compared to previous generations of the same age,” said Stake chief executive Matt Leibowitz.

“They feel empowered to make their own investing choices for the benefit of their retirement. They have access to more information about SMSFs and the financial markets than ever before. In this digital age, establishing a SMSF to build retirement assets is not as difficult as it once was.”

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