Rising costs of living are significantly impacting on Australian retirees, with couples needing to fork out over $60,000 a year for a comfortable retirement, according to new figures from the Association of Superannuation Funds of Australia (ASFA).
Releasing its Retirement Standard update for the June quarter, ASFA’s figures revealed Australian couples aged 65 seeking a comfortable retirement would need to spend $60,063 a year and singles $43,695, up 0.2 per cent on the previous quarter.
For those seeking a modest living standard, ASFA said Australian single retirees could expect to be set back $24,270 a year and couples would need to spend $34,911, totals that were up 0.1 per cent on the previous quarter.
Both budgets assumed the retirees owned their own home outright and were relatively healthy.
Total budgets for older Australians aged 85 and over seeking a comfortable lifestyle in retirement were lower, with a single retiree expected to spend $39,443 and couples $55,382 a year.
Those totals marked a 0.5 per cent increase on the previous quarter, the figures said.
ASFA chief executive Martin Fahy said older Australians were faced with the real prospect of significant increases in healthcare costs and super funds had an important role to play in helping educate their members and assisting them when it came to planning for retirement.
“The cost of retirement over the most recent quarter only increased by a relatively small amount and that is welcome news, but many retirees are still finding it difficult to achieve a comfortable standard of living in retirement,” Fahy warned.
“We need people to be retirement-ready by saving for the sort of life they want to live and getting their super sorted.
“Retirees now and in the future need super to increase and be safeguarded.”
According to the ASFA data, the largest price increases for retirees’ annual budgets in the June quarter were for medical and hospital expenses, rising 4.1 per cent due to the latest lift in private health insurance premiums, which came into effect on 1 April.
The data comes two months after ASFA urged the government to abolish its $450-a-month wage threshold for the super guarantee, which it alleged was harming the ability of Australians to save comfortably for retirement, with an estimated $125 million in super contributions not being realised.