May 30, 2024

Australians pushing retirement into their 70s amid cost of living crisis

Australians pushing retirement into their 70s amid cost of living crisis
85% of 2000 Australian survey respondents are more cautious about spending than they previously had been. [CoPilot].

Only a quarter (26%) of Australian workers plan to retire at 65, and many are planning to work longer in response to financial pressures, according to new research commissioned by leading fund Equip Super.

Those delaying their retirement are doing so by an average of six years, meaning many people are choosing to work until they are in their 70’s. Almost four in ten (39%) listed the rising cost of living as the reason for this delay. 

The research also found that 85 per cent of Australians are becoming more cautious about their spending. 

Paul Stocker, Head of Advice at Equip Super, highlighted the benefits of strategic financial planning in helping meet retirement goals. “Coping with the escalating cost of living is a shared concern for many Australians. We understand the financial difficulties that people encounter while planning for retirement, and we sympathise with those who are delaying retirement. By adopting strategic planning efforts, we want to help Australians retire when they choose to, rather than when they are forced to.”

“In times like these, it’s essential to have a solid financial plan in place, and managing your super is a crucial aspect of that plan,” said Mr Stocker.

“All Equip Super members have access to free general super advice at no additional cost as part of their membership. Members also have access to financial planners to design a more comprehensive financial plan. These tools help navigate uncertain times, and alongside regular contributions to your Super account, a retirement plan provides confidence that you can meet your retirement goals, enabling a comfortable retirement at whatever age you decide.”

Survey respondents were asked to list current top financial priorities, with covering living costs and growing savings as the top two, followed closely by mortgage repayments. The results also showed that three-quarters (75%) of Australians see their super as an important part of securing their financial future.

Diane Benham, a 70-year-old Sydney resident, has chosen to delay her retirement.

“I started working at 15, and now at 70, I am still working 20 hours a week. While our financial situation is generally stable, there are things we’d like to do when we retire, like travel. Delaying retirement wasn’t always part of my plan, but with expenses rising, it’s slightly worrying to think about life without an income. 

“We just don’t know what’s around the corner. Although we’re fortunate to own our home, there are ongoing maintenance costs, and everything from shopping to car expenses keeps increasing. Every time you go to the shops it seems to cost more money. 

When I finally decide to retire, it is essential that my superannuation provides me with a secure future, but also allows us to enjoy it.”

Mr Stocker said anxiety about retirement savings was natural in challenging economic times but urged individuals to seek expert advice to plan for a successful next chapter of their lives. “If people take the right steps today, they should not have to work longer than they want to,” he said. 

Equip Super’s survey questioned more than 2,000 Australians, randomly selected across the nation. The results illustrate the financial pressures being felt by many households across the country with rising inflation, interest rates and higher costs of living.

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