Market downturn presents super opportunities

1 April 2008

With the sharemarket trading at reduced levels, and an uncertain economic outlook, now may be a good time to reassess your savings strategy and consider investing into superannuation, according to Plum's regional manager Graeme Humphrys.

Speaking at the Australia Super Funds Summit 2008 last week, Mr Humphrys talked about Plum's latest superannuation savings program the Escalator Program and the advantages it presented in uncertain economic times.

'While no one can predict what the markets are going to do, in times like these incremental superannuation savings programs like Escalator have many advantages. This program allows members to contribute small amounts of money to their superannuation on a regular basis and spreads their investment risk over time.'

'In addition, with Escalator members' contributions increase in-line with their remuneration reviews so most members won't even notice the additional payments coming out of their take home pay.'

The Escalator Program, some variations of which are based on soft compulsion concepts, can be modified to meet individual corporate client needs and is offered on both an 'opt in' or 'opt out' basis, or a combination of these.

'The Escalator Program, was first implemented by Plum in response to industry data showing that many people would not have an adequate retirement income and although they knew this, they were still not taking steps to save more,' Mr Humphrys said.

'We know that although education continues to be imperative to help members save more, there is a segment of our members who are not being engaged by education alone. Escalator fills this gap and encourages all of our members to save.'

Escalator is the first of its kind in Australia. To date, results from corporate clients have exceeded expectations with around 25% of Plum's corporate clients implementing a variation of Escalator.

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