Half of Australians feel financially insecure about retirement, with some groups feeling even more uncertain. (Source: Getty/AAP)
Millions of Aussies are set to retire in the next decade, but half of us are not feeling confident about our finances. It’s sparked a “wake-up call” for Aussies as the cost of a comfortable retirement soars.
AMP has today launched its Retirement Confidence Pulse, a new national barometer tracking how financially confident Aussies feel about retirement. The first score is 50/100, revealing that half of us are feeling financially insecure about life after work.
Some groups are feeling even more financially insecure, with just two in five women feeling confident compared to three in five men.
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Single Australians, particularly single mums, along with job seekers and those in the “sandwich generation” juggling kids and aging parents, were also found to be under pressure.
“Australians over the age of 65 will make up nearly a quarter of our population within four decades – a demographic shift set to reshape the nation’s economic and social landscape,” AMP chief executive Alexis George said.
“Yet, as this Pulse shows, despite growing super balances and national wealth, too many feel financially insecure about life after work – an issue that needs to be front and centre for policymakers and the superannuation industry.”
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Just half of middle-income Australians earning between $45,000 and $135,000 reported feeling confident.
That changed with rises in income, with three in four earning between $190,000 and $250,000 feeling confident.
The findings come as the rising cost of living pushes the cost of achieving a comfortable retirement up.
Retirees now need more than $13,000 per year compared to five years ago, the latest Association of Superannuation Funds of Australia (ASFA) data found.
Couples aged 65 now need $75,319 per year to achieve a comfortable retirement, while singles require $53,289 per year.
Recent increases have been driven by rises in private health insurance, electricity and fresh food.
When it comes to retirement finances, a key figure will be your superannuation balance.
ASFA estimates that a 67-year-old couple would need $690,000 in their superannuation to achieve a comfortable retirement, while a single would need $595,000.
This is based on someone who owns their own, draws down all their capital and receives a part-age pension from the government.
Super Consumers Australia has also released targets and estimates that couples would need $420,000 in superannuation and singles $310,000 in super to maintain their living standards through their retirement.
Combined with the age pension, homeowners with this amount could have an annual amount of $43,000 and $62,000 until age 90.
AMP has encouraged Aussies to get in touch with their super fund or adviser for guidance, along with accessing their super funds free online advice and tools.
The Australian government’s MoneySmart website also provides budgeting and retirement planning resources.
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