Rising costs: How much super Aussies need to retire
Exclusive: Skyrocketing cost of living expenses could force Australians to work longer - and even then, many won't have enough money to retire comfortable.
The Association of Superannuation Funds of Australia's retirement standard data, released this week, showed rising expenses, such as private health insurance and food, had hit retirement budgets hard.
With costs up by 0.9 per cent on the previous quarter, the ASFA said those aged around 65 now need about $62,562 a year to retire comfortably while singles need about $44,224.
ASFA's deputy chief executive officer Glen McCrea said, "private health insurance increases have fed through" after annual 2020 price rises were delayed by six months and didn't hit until October.
"About 55 per cent of older Australians have private health insurance and so those cost increases have impacted on them," he said.
"For younger people in particular - a lot of them have emptied their accounts through early release of super - they really do need to save for their retirement and that's why we think going to 12 per cent is really important."
More than $36.4 billion was accessed by more than 3.5 million people under the Federal Government's early release scheme.
Compulsory superannuation contributions are set to climb from 9.5 per cent to 10 per cent in July then up to 12 per cent by 2025.
But there remains concern - predominantly by business groups - that these rises could ultimately cost jobs.
AMP also quizzed 2100 Australians and found 44 per cent of Australians are concerned about not having enough money to retire.
While 39 per cent are worried they will have to work longer than expected to achieve a comfortable retirement.
AMP's general manager of workplace super engagements Stephen Owen said many Australians are working well beyond the age of 65.
"People are living longer, they are healthier later in life," he said.
"People need to have greater financial resources to enjoy their lives in retirement."
A comfortable retirement enables a healthy retiree to have a good standard of living including top level private health insurance, travel on domestic and international holidays, own a reasonable car and have a good internet service and mobile phone allowance.
For Australians to achieve a comfortable retirement at age 67 ASFA data showed singles should have $545,000 in overall retirement savings and couples $640,000.
DECEMBER COST INCREASES
• Domestic holiday travel +6.3 per cent.
• Fruit +3.4 per cent.
• Beef and veal +3 per cent.
• Health insurance +3 per cent.
• +1.1 meals/takeaway.
• Vegetables -6 per cent.
Source: Australian Bureau of Statistics.
Originally published as Rising costs: How much super Aussies need to retire