Retirement
What we can learn from retirees
Australians are concerned they will have to halve their spending in retirement, but that doesn’t need to be the reality if lessons can be learnt from older retirees.
What we can learn from retirees
Australians are concerned they will have to halve their spending in retirement, but that doesn’t need to be the reality if lessons can be learnt from older retirees.
Most savers think their income will fall by 50 per cent upon retirement and are resigned to cutting back on entertainment, technology and clothing, and only 20 per cent think “all will be well” when they retire, State Street’s latest Australian retirement survey has revealed.
But older generations have wisdom to share, it added.
“You might think that the first piece of advice would be simple; just save more,” State Street Global Advisors said.
“But retirees are suggesting something a little more nuanced; start saving earlier, and speak to your superannuation fund or financial planner earlier.”
Generally savings rates only increase as workers near retirement, but a smaller increase earlier can have a greater impact than bigger increases later.
State Street spoke with retirees to understand the lessons they’ve learnt, with one 68-year-old woman calling on savers to “engage early and often plus salary sacrifice”.
The investment managers added that while about a third of Australians are planning on working part-time to boost income, the lived experience differs.
“Very few retirees we interviewed nominated part-time work as a significant source of income,” State Street said.
A similar trend occurs for downsizers.
While downsizing, using an equity release product or an investment property as income in retirement is favoured by workers, actual retirees don’t rank it highly as a source of income.
“Actually, around 40 per cent of the retirees we interviewed nominated spending on house renovation and redecoration as one use of their retirement savings,” State Street said.
According to the survey, all retirees expect to rely on super for income, while 44 per cent of the recently retired and 50 per cent of those later in retirement will use the age pension.
That’s followed by other investments (39 per cent for the recently retired and 45 per cent for those later in retirement). Investment property income is only expected by 4 per cent of the recently retired and 8 per cent of those later in retirement.
RELATED ARTICLES
Retirement Planning
New digital platform revolutionises retirement planning for Aware Super members
A groundbreaking digital platform by Aware Super is transforming the way retirees plan and manage their pensions, with significant results already seen in the pilot phase. The tool, named Retirement ...Read more
Retirement Planning
The retirement mortgage squeeze: how one bank turned a demographic risk into a strategic edge
An increasing share of Australians are entering their 60s still paying off mortgages, just as living costs and interest charges stay stubbornly high. For banks, super funds, retailers and ...Read more
Retirement Planning
The retirement mortgage crunch: what it means for banks, retailers and policy in Australia
A growing share of Australians are carrying mortgages into their 60s and beyond, colliding with persistent cost-of-living pressures and a “slow grind” macro outlook. This isn’t just a social story; it ...Read more
Retirement Planning
Majority of Australians still unsure about their retirement prospects
A recent survey conducted by MFS Investment Management® has shed light on the ongoing uncertainty faced by many Australians regarding their retirement plans. Despite a slight increase in confidence ...Read more
Retirement Planning
Wage growth steadies as businesses navigate economic challenges
In a sign that the Australian labour market may be finding equilibrium, wage growth has stabilised this quarter, according to Employment Hero's latest data. This development comes as employers ...Read more
Retirement Planning
Simplified retirement advice: Key to overcoming behavioural biases, experts say
In a bid to enhance retirement outcomes for Australians, a recent whitepaper by Industry Fund Services, in collaboration with Challenger, has highlighted the importance of simplifying retirement ...Read more
Retirement Planning
Rest launches Retire Ready digital experience to empower members approaching retirement
Rest, one of Australia’s largest profit-to-member superannuation funds, has unveiled a new digital experience aimed at making retirement preparation simpler and more personalised for its members. Read more
Retirement Planning
New Framework Aims to Bridge Australia’s Financial Advice Gap
A ground-breaking framework introduced by the Actuaries Institute promises to revolutionise how Australians access financial support, potentially transforming the financial wellbeing of millionsRead more
Retirement Planning
New digital platform revolutionises retirement planning for Aware Super members
A groundbreaking digital platform by Aware Super is transforming the way retirees plan and manage their pensions, with significant results already seen in the pilot phase. The tool, named Retirement ...Read more
Retirement Planning
The retirement mortgage squeeze: how one bank turned a demographic risk into a strategic edge
An increasing share of Australians are entering their 60s still paying off mortgages, just as living costs and interest charges stay stubbornly high. For banks, super funds, retailers and ...Read more
Retirement Planning
The retirement mortgage crunch: what it means for banks, retailers and policy in Australia
A growing share of Australians are carrying mortgages into their 60s and beyond, colliding with persistent cost-of-living pressures and a “slow grind” macro outlook. This isn’t just a social story; it ...Read more
Retirement Planning
Majority of Australians still unsure about their retirement prospects
A recent survey conducted by MFS Investment Management® has shed light on the ongoing uncertainty faced by many Australians regarding their retirement plans. Despite a slight increase in confidence ...Read more
Retirement Planning
Wage growth steadies as businesses navigate economic challenges
In a sign that the Australian labour market may be finding equilibrium, wage growth has stabilised this quarter, according to Employment Hero's latest data. This development comes as employers ...Read more
Retirement Planning
Simplified retirement advice: Key to overcoming behavioural biases, experts say
In a bid to enhance retirement outcomes for Australians, a recent whitepaper by Industry Fund Services, in collaboration with Challenger, has highlighted the importance of simplifying retirement ...Read more
Retirement Planning
Rest launches Retire Ready digital experience to empower members approaching retirement
Rest, one of Australia’s largest profit-to-member superannuation funds, has unveiled a new digital experience aimed at making retirement preparation simpler and more personalised for its members. Read more
Retirement Planning
New Framework Aims to Bridge Australia’s Financial Advice Gap
A ground-breaking framework introduced by the Actuaries Institute promises to revolutionise how Australians access financial support, potentially transforming the financial wellbeing of millionsRead more
