This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice for more information on the cookies we use and how to delete or block them.

Bookmark Email Print page

Gen X and Y warned to get their super act together


“The Treasurer’s announcement that concessional superannuation contribution caps will be more than halved for all contributors from 1 July 2009 means that the level of deductible contributions will have been slashed by more than 75% in less than three years,” said Deloitte Superannuation Partner, John Randall.

“On 1 July 2007 the standard concessional contributions were reduced to $50,000 from more than $100,000,” he said.

“From 1 July 2009, the standard concessional contribution cap will now be further reduced to $25,000.

“These changes will impact younger generations who would not normally make super contributions until later in their working life,” said Randall.

While he acknowledged that the announcement was not unexpected, he said, “It does send a clear warning to the younger generations that they can’t afford to wait until later in their working life to begin contributing to superannuation.

“If Gen X and Y want to achieve adequate retirement incomes beyond a level funded solely from compulsory contributions, they will have to start to consider ways to increase their superannuation contributions sooner rather than later.

“Assuming an individual has a 40 year working life, the maximum concessional contributions primarily from salary sacrifice, will total $1 million (excluding indexation) instead of the current $2 million.

“While even $1 million may seem a lot in today’s terms, there is no guarantee that even this amount will ensure that the individual will have adequate retirement savings,” Randall said.

“The big concern of course is, that if Gen X and Y don’t start their contributions at the beginning of their working life, and leave it for five, ten or even 20 years, which is current behaviour, then there will now be no chance to play catch up,” he warned.

Last Updated: 


Louise Denver
Job Title:
Director, Corporate Affairs & Communications
Tel: + 61 2 9322 7615, +61 414 889 857
John Randall
Deloitte Australia
Job Title:
Superannuation Partner
Tel: +61 2 9322 7550; Mob: 0414 801 984




Follow us


Talk to us