Is your super looking a bit sad?
Why sole traders are at risk of a retirement crisis
If you’re a sole trader or running a micro business, chances are you’ve thought to yourself: ‘I’ll sort out super later. Right now I’ve got a business to build’. If this sounds familiar, you’re not alone.
New research from AMP has found that almost half of Australia’s smallest business owners aren’t putting a cent into their super. Instead, they’re channelling every spare dollar back into the business (or just using their cash flow to keep the lights on).
The trouble is, while reinvesting in your business feels smart in the moment, it could set you up for a rude shock come retirement. Unlike employees, who get their 12 per cent super paid automatically thanks to the Super Guarantee, the self-employed aren’t covered. That’s 2.2 million Aussies essentially flying blind when it comes to their financial future.
And if you’re a sole trader? The stats are even worse. Only half of solopreneurs and 55% of micro-business owners (those with four or fewer staff) are regularly tipping into their super.
Superannuation: the long game we keep putting off
It’s no secret why. AMP’s Director of AMP Bank GO, John Arnott, suggests many soloists and micro businesses are simply struggling to make ends meet
“In the early stages, cash flow is often tight – paying a wage, let alone contributing regularly to super, can be a real challenge.”
He’s right. When you’re hustling to pay invoices, super feels like a luxury problem. But ignoring it only makes the gap bigger.
To put it in perspective, AMP’s modelling shows that if you start at 30 and chuck just $100 a week into super (with a 6% return), by 65 you could be looking at over $500,000. That’s half a million bucks your future self will thank you for. Not bad for the price of your week’s coffees and a couple of smashed avo brunches.
Who’s contributing and who’s not
The research also uncovered some pretty stark differences across industries and locations. Those working in financial services seem to be leading the way, with more than 70% making regular super contributions. At the other end of the scale, creatives are falling behind, with fewer than half putting money aside for retirement. It’s proof that passion projects don’t always pay the bills later in life. Location and business maturity also play a role. Owners in rural areas, along with those still finding their feet in the first three years of business, are among the least likely to contribute to super.
How to stop playing catch-up
It’s not all bad news though – a few tweaks could get your super back on track. Even small, regular contributions make a difference.
Try these tips to get started:
Stay in the know
Don’t bury your head in the sand. Use tools like AMP’s retirement calculator, ATO and ASIC’s MoneySmart website, or your bank’s resources to stay on top of changes and crunch the numbers.
Pay yourself first
Treat yourself like an employee. Set up a regular transfer into your super, even if it’s a small amount – or make lump sum contributions when cash flow allows.
Grab government incentives
Look into the government’s super co-contribution scheme or tax-deductible personal contributions. Free money from Canberra? Yes please.
Automate the boring stuff
Use your banking app or accounting software to automate payments and track cash flow. That way, you won’t forget to pay yourself super.
Ask for help
Super can feel like alphabet soup. Get advice from your super fund or an accountant, and lean on your business mates for ideas that actually work in the real world.
Running a small business is already a juggle, but the future you deserves more than relying on selling the business one day or living off the pension. Even a few dollars a week adds up when compounding interest works its magic. So next time you’re tempted to skip super in favour of a shiny new gadget for your biz, think twice. Your business might be your baby now, but your retirement self will thank you for thinking ahead.
Source: Flying Solo August 2025
This article by Cec Busby is reproduced with the permission of Flying Solo - Australia's micro business community. Find out more and join over 100K others https://www.flyingsolo.com.au/join.
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