Mar 23, 2023

Older couples now need an extra $50,000 to be able to retire comfortably. What’s your plan?

23_3_22 cost of retirement HC

New data has confirmed inflation has caused the amount of money needed for a retirement nest egg to jump significantly, according to the Association of Superannuation Funds of Australia (ASFA).

Australia has experienced a huge price increase for basic necessities such as food, fuel and electricity in the past few months and that price surge has extended over to the cost of retirement – with older couples now needing an extra $50,000 in savings to be able to retire comfortably.

According to ASFA’s latest Retirement Standard report, expenses have also pushed up the amount of money needed to retire comfortably to $69,691 a year for a couple aged around 65 and $49,462 for a single.

The report said that the assets needed to achieve this level of income, through a combination of superannuation and the Age Pension, means a couple now requires $690,000 combined while a single needs $595,000. 

During the final three months of 2022, retiree costs rose 2.5% which is above the official Consumer Price Index (CPI) inflation figure of 1.9%.

ASFA Chief Executive, Martin Fahy, told News Corp that retirees are chewing into their retirement budget in order to stay afloat.

“Food’s up by 9.2%, bread’s up 13.4[%], anything to do with imported oils and fats: 20%, electricity is up by 12%,” he said.

“In the face of inflation, we need to be saving for retirement.”

On Monday, pensions and other Government payments increased by 3.7% as part of their twice-yearly indexation to inflation and other data.

Dr Fahy said the increase in compulsory super contributions to 12% by mid-2025 would allow the majority of older Australians to have a comfortable retirement.

The median super balance for 60-64-year-olds is currently sitting at $181,000 for men and $139,000 for women. Average super balances are $358,000 and $288,000, respectively.

“It reinforces the need to save for retirement, the importance of the 12% and the importance of being able to continue to provide the safety net of the Age Pension,” he explained.

“If we haven’t got 12[%] I think we will have more and more people leaning on the Age Pension.”

Leave a Reply

Your email address will not be published. Required fields are marked *


Son discovers mother in a body bag during aged care visit

Failure to notify the deceased woman’s family has resulted in her son stumbling upon police loading his mother’s body into a van when he arrived at her Brisbane aged care home for a visit. Read More

Migrant employees in aged care could receive sponsorship to live in Australia

Aged care employers are now able to sponsor migrant workers on skilled visas to help them fill important jobs and plug workforce shortages in the sector, according to the Federal Government’s new Labour Agreement. Read More

Community Vision takes action to support mental health and suicide prevention

Read More