Superannuation balances are growing faster than the value of housing and will become the largest single investment for Australian households on average late next decade, new research shows.
The latest Household, Income and Labour Dynamics in Australia Survey (HILDA), released by Melbourne University, shows that Aussie super balances grew by 66 per cent between 2002 and 2014 to an average of $186,011 per household.
Owner occupied housing was still the largest single household asset in 2014, with an average value of $392,241 per home-owning household.
But housing asset values grew slower than super balances, by 39.5 per cent. If you factor in mortgage debt, housing assets for the average home owning household stood at $291,552 in 2014, up 26 per cent from 2002.
And while the percentage of households with super assets grew, home ownership as a per centage of households is actually on the slide. Back in 2002, 76.9 per cent of Aussie households had superannuation; by 2014 this had jumped to 84 per cent.
Home ownership actually went the other way, falling from 68.8 per cent of households in 2001, to 64.8 per cent in 2014. The home ownership fall was most pronounced in Victoria where ownership fell from 73.9 per cent of households to 66.6 per cent between 2001 and 2014.
NSW had the next biggest decline, from 67.5 per cent to 62.1 per cent. In WA however, the figure was flat at 69.6 per cent.
While super balances have grown strongly, there are dramatic inequalities between the sexes and age groups. Men aged between 65 and 68 topped the super balance table, with average balances of $284,312. Among women, the 61 to 64 cohort had the highest balances, but these only averaged $188,501.
However in younger age cohorts, women are showing signs of bridging the gender gap in super.
Women aged between 33 and 36 had average super savings of $42,199 in 2014, compared to only $5,603 when they were aged between 21 and 24. That means their super savings have jumped 750 per cent.
The same cohort of men had average super balances of $52,627 in 2014 compared to $15,395 when they were aged between 21 and 24. That means their super balances have jumped 342 per cent, considerably less than the gain made by women in that cohort.
Superannuation savings are massively weighed towards high income earners. The average balance for top 10 per cent of super accounts grew 52 per cent from $650,619 in 2002 to $991,268 by 2014.
Over the same period the average balance for the smallest 50 per cent of super accounts grew from only $1365 to $13,791. That’s a rise of about 10 times, but it still means half the population who have super have very small balances.
There is some evidence that women are closing the super gap at the top end. Of the top 10 per cent of balances, 78.5 per cent were held by men in 2002 whereas by 2014 that figure had fallen to 67.7 per cent.
However women accounted for the majority of the smallest 50 per cent of super accounts, holding 60.2 per cent of the total in 2002. This figure improved only very slightly to 59.6 per cent in 2014.
Overall household wealth grew 44 per cent over the 12 years between 2002 and 2014 to $916,014. Overall household debt grew 92 per cent to an average of $173,839.
Median household wealth, a figure that reflects the relative numbers of households in different wealth cohorts, grew 31.6 per cent to $450,822.
All figures used in this story are in 2014 prices to counter the statistical effects of inflation.