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Australian couples need upwards of $600k to retire comfortably, ASFA says

Australia’s superannuation industry’s peak body has revealed how much money older people need to retire comfortably after a slight, temporary reprieve from retirement costs for seniors. Recent falls in petrol and electricity prices have led to a 0.5 per cent drop in retirement costs this quarter, meaning seniors will have some extra change over Christmas. “The relief of short-term retirement budget pressures will be a welcome festive gift for retirees at this time of year,” said Association of Superannuation Funds of Australia (ASFA) chief executive Mary Delahunty.

Australian couples need more than $600,000 to retire comfortably, says ASFA

people hoping for a comfortable retirement will have to think twice about how long they want to keep working. (iStock) However, despite some relief in the short term, ASFA data shows retirement costs have increased significantly over the past 20 years. In 2004, a 65-year-old single needed just $31,797 a year to live comfortably in retirement, while a couple needed $41,394. Twenty years later, ASFA revealed a 65-year-old single needed $51,814 a year to live comfortably, while the figure for a couple was $73,031. This means a couple retiring at 67 would need $690,000 in superannuation when they retire, while a single person would need $595,000. The most recent data assumes retirees have the highest level of health insurance, like to eat out from time to time and can enjoy one domestic holiday a year. It also assumes the couple or single owns their own home.Currently, only about 30% of retirees feel they have enough money in their accounts to live comfortably, Delahunty said. That share is expected to rise to 50% as more people take advantage of the guaranteed pension rate, which increases to 12% on July 1, 2025. “Older people are under a lot of cost of living pressures, and they need a lot of things they really can’t live without,” she said. “We’ve seen even modest retirement budgets go up over the last 20 years, like Medicare has gone up dramatically, energy costs .. food, groceries.” “Those are the items retirees need the most.”

Australian couples need more than $600,000 to retire comfortably, says ASFA

Delahunty said only about 30 per cent of retirees currently felt they had enough money in their accounts to live comfortably. (9News) Over the past two decades, electricity prices have risen 150 per cent, while water and sewer rates have risen 161 per cent. Gas prices have risen 122 per cent and petrol prices have risen 113 per cent. Medical and hospital costs have risen 112 per cent, while property rates have risen 106 per cent. Insurance costs have also risen 99 per cent. 9News Finance Editor Effie Zahos has some advice for Australians whose superannuation may not be up to par. People can boost their super by making sure they choose the right investments and don’t pay too much in fees. There is also a government co-contribution option which can add up to $500 a year to your super if you qualify. To get the full $500 contribution from the government, you need to earn $45,500 or less and contribute $1000 to your super from your take-home pay.

Australian couples need more than $600,000 to retire comfortably, says ASFA

a couple retiring at 67 will need $690,000 in superannuation when they retire. (iStock) Highest paying jobs that let you work from home View gallery Other tips include signing up to cashback sites so you can deposit rewards directly into your superannuation. For those already nearing retirement, superannuation can help supplement your superannuation income. You can contact a Services Australia Financial Information Service Officer for assistance. The information provided on this website is of a general nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website, you should consider whether the information is appropriate in light of your objectives, financial situation and needs.

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