The latest research into the sentiment of older Australians has shown the rising cost of living across the country has caused pre-retirees to be less confident of living a happy life when they cease working.
The second annual “Challenger Retirement Happiness Index” released today revealed three in four pre-retirees, or 76 per cent, indicated their financial security had been affected by the current increase in the cost of living, with 34 per cent of the cohort saying the impact was significant.
Further, the study found women and unadvised individuals are the least confident about retirement. The index showed 34 per cent of women over 60 being extremely or very worried about outliving their savings compared to 20 per cent of men, while 35 per cent of people not receiving financial advice expressed this sentiment as opposed to 19 per cent of Australians getting advice.
“We know retirement can be one of the most rewarding stages of life, but confidence is key. When people feel uncertain about their finances, they tend to hold back. That’s led to a chronic underspending problem in retirement, with many Australians living more cautiously than they need to,” Challenger customer chief executive Mandy Mannix noted.
In addition, the research indicated education could make a difference to peace of mind in retirement, in particular with managing longevity risk, with 74 per cent of respondents believing better financial education would improve their happiness.
With regard to the most telling contributing factors to a happy retirement, survey participants nominated activities, mental health and wellbeing, and a sense of purpose.
“Ask a happy retiree what brings them joy and they won’t just talk about their super balance. They’ll talk about the coffee catch-ups, the morning walks and the holidays they have planned to visit family or see the world. The little things make a big difference, which is why activities and purpose are so important,” Mannix said.
“When we asked Australians over 60 what made them happy, three things stood out: good physical health (59 per cent), enough money to enjoy life (41 per cent) and good mental health (38 per cent).”
The second “Challenger Retirement Happiness Index” was compiled in conjunction with research house YouGov and analysed responses from 1633 Australians over the age of 60 about the key elements providing happiness in retirement.
