Research house CoreData found that pre-retirees expect to need an average of $1,224 a week in today’s dollars, which is up from $1,124 in 2015 and $1,015 in 2014.
The research also found that retirees will need a superannuation balance of $804,559 to maintain their desired lifestyle in retirement.
Almost 55 per cent of those surveyed now think it’s unlikely they’ll achieve these financial goals, which is up from 39.5 per cent in 2015 and 36.1 per cent in 2014.
As a result, more than 80 per cent of pre-retirees will need to keep working in some capacity after they retire from full-time work, in order to meet their lifestyle expectations.
“The reality is that retirees are either going to have to drastically alter their expectations for retirement or start making some serious financial and lifestyle sacrifices now if they have any hope of reaching their financial goals in retirement,” said Kristen Turnbull, head of WA at CoreData.
A potential contributor to the retirement income deficits facing Aussies could be their lack of awareness and understanding of the retirement services on the market.
The research found less than one third of respondents claim to have a good understanding of products such as annuities.
“Poor levels of knowledge and understanding are the more commonly cited barriers to take-up; however, reluctance to relinquish control poses another key challenge for annuities providers, particularly at a time when cash rates are at record lows,” said Ms Turnbull.