Millions of Australians are approaching retirement, but many are feeling unprepared. Rising living costs and financial insecurity have made retirement planning a pressing concern for households across the nation.
A new report highlights a growing “wake-up call” for Aussies: retiring comfortably is now more expensive than ever, and many people are not ready.
Australians Feeling Financially Insecure About Retirement
AMP’s latest Retirement Confidence Pulse reveals that only half of Australians feel confident about their finances after leaving the workforce.
- Women are less confident than men, with just 40% feeling secure about retirement.
- Middle-income earners ($45,000–$135,000) are the least confident, while high earners ($190,000–$250,000) fare better, with 75% expressing confidence.
- Single parents, job seekers, and the “sandwich generation” (those caring for children and aging parents) report heightened financial pressure.
AMP CEO Alexis George warns that the ageing population—projected to make up nearly a quarter of Australians by 2065—will reshape the economy. “Despite growing super balances and national wealth, too many Australians feel financially insecure about life after work,” George said.
Rising Retirement Costs
The Association of Superannuation Funds of Australia (ASFA) reports that the cost of a comfortable retirement has jumped by over $13,000 per year in just five years.
Current estimates for retirees aged 65+:
| Status | Annual Cost |
|---|---|
| Single | $53,289 |
| Couple | $75,319 |
Key drivers of rising costs:
- Private health insurance
- Electricity bills
- Fresh food
How Much Superannuation Do You Need?
A major factor in retirement planning is your superannuation balance. ASFA suggests the following for a comfortable retirement:
- Single: $595,000
- Couple: $690,000
This assumes:
- Owning your own home
- Drawing down all capital
- Receiving a partial age pension
Alternative guidance from Super Consumers Australia:
- Single: $310,000
- Couple: $420,000
With these balances, retirees could access $43,000–$62,000 annually until age 90, including the age pension.
Quick Tips for Retirement Readiness
- Check your super balance regularly – use online tools or contact your fund for guidance.
- Budget for rising living costs – factor in health, energy, and food expenses.
- Seek professional advice – financial advisers can tailor plans to your needs.
- Use government resources – MoneySmart offers free retirement calculators and planning tools.
- Consider part-time work – bridging the gap can ease financial stress in early retirement.
FAQs
Q1: What is considered a comfortable retirement in Australia?
A: For couples aged 65+, $75,319 per year; for singles, $53,289.
Q2: How much super do I need to retire?
A: ASFA recommends $690,000 for couples and $595,000 for singles.
Q3: Why are retirement costs increasing?
A: Mainly due to rising health insurance, electricity, and food prices.
Q4: Are women less confident about retirement?
A: Yes, only 40% of women feel financially secure compared to 60% of men.
Q5: How can I improve my retirement confidence?
A: Check your super, budget for future expenses, seek financial advice, and use tools like MoneySmart.
Conclusion
Retirement is a major life milestone, but rising costs and financial insecurity mean many Australians are not ready. Understanding your superannuation, budgeting for expenses, and seeking professional guidance can help you retire comfortably.