Covid-19 reinforces need for savings: Exec

THE Covid-19 pandemic has taught Papua New Guineans a lesson on the importance of savings, says Nambawan Super chief executive Paul Sayer.
Sayer told The National that more financial literacy was needed in the country.
“This will educate and prepare members for emergency and crisis situations rather than relying heavily on superannuation savings which are meant for retirement,” he said.
“There is an opportunity out of this experience for PNG to consider how the workers have savings, or the creation of a safety net of some kind, for an emergency like this.
“This could be an insurance scheme or a different savings scheme for all workers and not just those covered by superannuation.
“Such a scheme would need to be supported by new legislation, and could be managed outside of the superannuation environment where different investment structures can be used for shorter term investment horizons.”
Sayer said superannuation was only for retirement or when one was no longer working as specified in the superannuation laws.
“The Superannuation scheme is structured for retirement, which has long-term investment horizons and shouldn’t be viewed as a form of social security.
“We are also promoting the message that members should only access their savings as a last resort.
“History has shown members are best leaving their funds to continue to grow in the fund to achieve their best retirement outcome.
“It is important for members to remember that superannuation is a long-term investment, and fluctuations in returns from year-to-year are expected.”