Cost of living on the rise for retirees

Cost of living retirees

Price increases returning to normal after the easing of COVID-19 restrictions has resulted in a rise in the cost of living for retirees in recent months.

The cost of living for retirees has risen in recent months, with many feeling the impact of certain price increases returning to normal after being temporarily paused last year as a result of the COVID-19 pandemic, the Association of Superannuation Funds of Australia (ASFA) has said.

According to ASFA’s Retirement Standard for the December 2020 quarter, the cost of living for couples and singles aged around 65 living a comfortable retirement increased by 0.9 per cent compared to the September quarter, with couples needing to spend $62,562 a year and singles needing to spend $44,224.

The association pointed out health insurance premiums increasing by around 3 per cent from 1 October after remaining unchanged for most of 2020 would have contributed to the additional rise in expenses for many retirees.

In addition, the December quarter saw the price of domestic holiday travel and accommodation go up by 6.3 per cent as a result of state and territory borders being reopened for a time following the pandemic.

ASFA also noted the reopening of restaurants had contributed to the price of dining out increasing by 1.1 per cent during the same period.

“COVID-19 impacted just about every aspect of Australia’s financial and economic conditions. Now, price increases are returning to a more standard pattern following a few quarters of suspension or delay in key costs, such as health insurance premiums,” ASFA deputy chief executive Glen McCrea said.

“As a greater number of people ventured out of their homes in search of a meal out or a domestic holiday, we saw price rises in those areas, which is not altogether favourable for retirees on a budget.”

In October, Association of Independent Retirees president Wayne Strandquist said self-funded retirees had been overlooked in the federal budget, which should have included support measures to offset retirement income losses stemming from the impact of COVID-19 on the economy.

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