Less than 20% of retiring individuals and less than 30% of retiring couples aged over 65 are able to retire comfortably. Are you in their number?
The Association of Superannuation Funds of Australia (AFSA) defines a ‘modest’ retirement lifestyle as one which is better than the Age Pension but where the retiree is still only able to afford basic activities. A ‘comfortable’ lifestyle is defined as when a retiree is able to “be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of things such as; household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.” In both cases, it is assumed that the retirees own their own homes outright and are relatively healthy.
ASFA’s research indicates that individual retirees require at least $545,000 in super in order to have a comfortable lifestyle in retirement, whilst couples will require at least $645,000. They have also found that whilst the cost of living for retirees did reduce slightly during the March quarter, less than 20% of retiring individuals and less than 30% of retiring couples aged over 65 are reaching this standard of living.
When going it alone, many of us feel unprepared for retirement. According to MLC, nearly half of all Australians not currently working with a financial advisor feel that they do not have enough superannuation to see them through their retirement. Of those receiving financial advice however, 76% were more confident and were much more likely to agree that they would rely on their superannuation in retirement.
We’re still not happy with that number, and strive to ensure that 100% of our clients feel completely comfortable with the knowledge that they will experience a comfortable and enjoyable retirement. If you have any doubts about your retirement planning, call and speak with a member of our Strategic Advice Team today.