Super savings fall, household expenses rise – why did you retire?

A check on your super balance will most likely see that it’s gone down since the start of the year – and yet the cost of a weekly shop has gone up, and the price of your favorite restaurant meal makes it unpleasant.

New research by independent retirement fund provider Household Capital, in conjunction with Your Life Choices, finds that many seniors feel retirement is falling short of expectations due to the rising cost of living – is it? Is it any wonder that consumer price inflation is climbing at its fastest pace in decades and the stock market has fallen more than 15% in the past six months?

The research, which included more than 3,500 seniors, found that 48% had a negative view of their retirement experience, with almost half of respondents admitting this next stage of life is falling short of expectations.

The study also found that 34% were ‘not at all confident’ that they could avoid outliving their retirement savings, highlighting the pressing need for greater financial stability and regular income to help alleviate these stressors.

“Neither pensions nor superannuation keep up with inflation, which means pensioners are falling back and struggling to keep up with the cost of living,” said Dr. Joshua Funder, CEO of Household Capital.

“More than 75% of retirees are homeowners. What many Australians don’t realize is that they can use the value or ‘equity’ built up in their home both to secure their retirement home and to improve their retirement lifestyle, reducing their financial stress and making the most of their retirement.

Meanwhile, new research by the AMP has found worries about retirement have intensified, with three in five Australians worried they won’t have enough to retire, up from two in five in 2020.

AMP’s managing director of retirement solutions, Ben Hillier, said around one in three people would be willing to lower their lifestyle expectations, while 61% of people would be willing to work more. long time.

“But maybe that’s not necessary. Many of us spend less in retirement, dying with up to 90% of our super savings intact, according to the Treasury Retirement Income Review,” said Ben.

The federal government allows retirees to earn $7,800 per year of income without it counting against Centrelink’s pension income test. It recently increased the limit to $11,800 for the 2022-23 fiscal year.