The Trump administration is turning to Australia for ideas on how to reshape the United States’ retirement savings system.
Speaking at the White House on Tuesday, President Donald Trump said his team is studying an Australian-style retirement model as a potential guide.
“We’re looking at it very seriously,” Trump said. “It’s a good plan. It’s worked out very well.”
At the center of that interest is Australia’s primary retirement savings framework, known as “superannuation,” which appears to have caught the eye of policymakers in Washington.
How Australia’s ‘Super’ System Works
Superannuation — often shortened to “super” — is Australia’s core retirement savings program.
Under the system, employers are required to contribute to workers’ retirement accounts, which are invested in designated funds called super funds. These contributions are made in addition to employees’ regular wages. Workers can also add their own contributions on top of what employers pay.
Employers must put the equivalent of 12% of an employee’s income into these super funds — a rate that has gradually risen from 3% since the current version of the system was launched in 1992.
“There is no opt out,” Tim Jenkins, a partner at consulting firm Mercer, told CNN. “If you are employed, your employer must pay 12% of your pay to your retirement savings, and it’s locked up until you’re approaching retirement age with a few ways to access on the way, but very limited indeed.”
Despite Australia ranking only 55th in the world by population, its super funds make up the fourth-largest retirement savings pool globally, according to JPMorgan Chase.
Altogether, the superannuation system holds roughly 4.5 trillion Australian dollars in assets (about $3 trillion).
Workers can choose among different super funds, which are professionally managed by financial institutions, regulated by the government and invested across a wide range of global assets, including stocks and private equity.
Why the System Is Popular
Superannuation was introduced largely to address the challenges of an aging population and to help ensure people can support themselves financially after they stop working.
“With an aging population and declining birth rates, a system like this takes the fiscal burden off future generations,” Jenkins said.
On the Mercer CFA Institute Global Pension Index for 2025, Australia’s retirement system earns a B+ rating, compared with a C+ for the United States.
Australia also provides a government pension that acts as a safety net for those who need extra support. Even so, “super” has increasingly become the main vehicle for retirement savings.
How the U.S. System Compares
In the United States, employer-sponsored retirement plans like 401(k)s — introduced in 1978 — are optional. Employers can decide whether to offer such plans and whether to match workers’ contributions.
The backbone of retirement income in the U.S. is Social Security, created in 1935 under President Franklin Delano Roosevelt. Workers pay into the system through payroll taxes, which go into a fund used to pay current retirees. As the U.S. population ages, concerns have grown about the long-term health of Social Security’s finances.
In broad terms, Australia’s mandatory, employer-funded investment accounts stand in contrast to the American approach, where voluntary 401(k) plans sit alongside a long-established Social Security program.
Whether the U.S. could realistically adopt something closer to the superannuation model remains uncertain, especially given the political sensitivities around changing retirement programs. The scale difference is also significant: Australia has about 27 million people, compared with roughly 343 million in the United States.
Growing Interest in Australia’s Model
Trump’s recent comments are not the first time Australia’s system has come up within his administration. Australian super funds are already major investors in U.S. assets, and Treasury Secretary Scott Bessent praised the program’s performance during a superannuation summit in Washington, D.C., in February.
Matthew Linden, executive general manager of strategy and insights at Super Members Council, who attended the summit, said: “What has struck US officials and investors is how the strength of Australia’s super system policy settings — automatic super payments, near universal coverage and preservation of savings until retirement — have helped Australians grow world-leading retirement nest eggs.”
