The shocking amount Australians will need to have saved to retire comfortably has been revealed and could spell disaster for an aging population.
Research by the Association of Superannuation Funds of Australia (ASFA) has revealed that the average single Australian aged 65 to 84 would need $52,085 a year to live comfortably in retirement.
That means they would need more than $1 million saved to sustain a 20-year retirement period.
The research also found that couples in the same age range would need $73,337 a year, adding more than $466,000 to the savings needed to live comfortably.
This is despite separate ASFA figures revealing the average Australian only has $549,000 in their super by age 65.
The ASFA figures, which grew by 0.9 percent in the second quarter of 2024 and 3.7 percent in the last 12 months, also assume that retirees own their home.
A breakdown of average monthly costs has also revealed how retired Australians are being pushed to the limit due to the rising cost of living.
ASFA chief executive Mary Delahunty said it was more “crucial” than ever for Australians to have a secure retirement plan that doesn’t rely solely on superannuation.
The average Australian pensioner would need more than $1 million saved to live a comfortable retirement for 20 years, according to new research (file image)
Ms Delahunty added Australians should continue to have access to “adequate retirement savings” for a comfortable retirement.
“Retirees face an increasingly difficult landscape in which the costs of essential goods and services continue to rise,” he said.
“Health, housing and transportation are vital to your well-being, but the expenses linked to these needs are constantly increasing.”
Transport, housing and food have proven to be the factors that put the greatest pressure on pensioners’ weekly budgets.
While annual food inflation decreased from 3.8 percent to 3.3 percent during the quarter, fresh vegetables and fruits are still 3.7 percent higher than a year ago.
The increases led to the average Australian pensioner spending around $144 a week on groceries, while transport and housing cost them $181 and $142 respectively.
The figures could spell disaster for the average Australian who only has $549,000 in retirement at age 65 (file image)
H&R Block Tax Communications Director Mark Chapman said the investigation was another warning for Australians to start taking their retirement seriously.
Chapman said Australians should think about their super as soon as possible as it has more time to grow when they retire.
“Although retirement may seem very far away when you start your first job, it is worth taking it very seriously from the beginning of your working life,” he said. yahoo.
“Investing in Super is a good way to save for your retirement, especially when you start earning more and your personal marginal tax rate increases.”
Chapman also urged Australians to consolidate their super into a high-fee-free fund as it has the “potential to dramatically reduce the amount they will be able to live on in their old age”.