Lack of financial literacy can lead to poverty for older Australians

As a result, failure to seek financial advice can increase the risk of elderly poverty, especially if people retire without having bought or paid off a home.

Any savings that can be preserved can make a meaningful difference to the capacity of such households to have a dignified retirement.

For these reasons, access to free and independent advice is critically important for the superannuation system to better serve low-balance households. But free, independent advice is still not available in the superannuation system.

It is not surprising low-balance households are reticent to engage in super given the lack of accessible advice. But the peripheral role of low-balance households in a system dominated by Australia’s wealthiest households may play a role in that reticence as well.