Educating Australians about super has been hijacked by political debates on the tax rate of earnings and contributions.
The lack of knowledge we have of superannuation and the different types of products available could be hindering the savings and retirement lifestyles of thousands.
New products have been created for super members, advocating the best solution for anyone who might not be interested in monitoring their retirement savings or those who want more certainty about their income once they stop work.
However good the intentions have been from policy makers, super savers need to actually understand how these products work, and this is out of the financial grasp of many.
There are two major risks facing all retirees and the latest product can help solve these problems - but given so few super savers know that these products exist, you have to questions their effectiveness.
One danger all savers face is living longer than their savings, often referred to as longevity risk.
While many Australians will be eligible to fall back on the Age Pension, it might not be enough to maintain the lifestyle of a retiree who is accustomed to spending more than government financial assistance offers.
Secondly, sequencing risk can derail even the most meticulously planned retirements when poor returns strike at the wrong time.
Generally this happens just before becoming entirely dependent on your super, or in the early stages of.
One of the new solutions, a comprehensive retirement income product, aims to address these risks. For one, it offers retirees a predetermined amount of cash monthly, for a set length of time.
Other perks include reducing the worry about what a sharemarket moving violently from high to low - like we are experiencing - will have on your super balance.
The amount of income is decided by a range of factors, but is largely influenced by the amount of super that will be directed to the income stream.
Although super funds don’t have to offer their members access to a retirement income product, it’s questionable whether or not those who could benefit most from the retirement income solution are aware how it could benefit them.
While retirement income products are complex, the idea is that they will eventually be available to all retirees without having to seek financial advice.
Not all super funds yet offer an income product for retirees, but you can’t help wonder if more baby boomers - those most likely to benefit from the structure - knew how it could benefit them what the interest would be like.
It has been tipped balances under $500,000 would be most suited to an income solution.
Considering there are an estimated 2 million retirees with the average balance of someone over age 65 being $243,000 there is a lot of people retirement income products could benefit.
While discussions around changing tax rates to make super more equitable for all are valid, time and resources could be better spent on bumping up what retirees know about the amount of cash to splash in their later years.