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 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
The downsizer dividend: how Australia’s ageing shift will reshape property, finance and AI strategy
Downsizing is moving from a personal milestone to a system-level lever for Australia’s housing market. As policymakers court reforms and agents eye fresh listings, the real profit pools will accrue to ...Read more
Retirement Planning
Half of Australians financially insecure about retirement as AMP launches new initiative
In a significant move aimed at addressing the retirement concerns of Australians, AMP has unveiled the Retirement Confidence Pulse, a national barometer designed to gauge the financial confidence of ...Read more
Retirement Planning
North introduces Grow to expand Australia's financial advice footprint
In a bid to bridge the gap between the demand for financial advice and its accessibility, North, a prominent platform for superannuation and retirement in Australia, has launched an innovative ...Read more
Retirement Planning
Majority of Australians anxious about retirement as super knowledge gaps persist, report finds
A new study by Aware Super has revealed that a significant majority of Australians aged 45 and over are feeling anxious about retirement, with nearly nine in ten respondents concerned they will run ...Read more
Retirement Planning
AMP’s MyNorth Lifetime boosts financial security and retirement income
AMP has reported that its MyNorth Lifetime retirement income solution is delivering significant financial benefits to retirees, with an average uplift of 50% in total income. Read more
Retirement Planning
Retirement living sector calls for planning reforms amid declining construction confidence
The Retirement Living Council (RLC) is urging governments to streamline planning systems to boost housing supply, following a decline in confidence in age-friendly construction activity. Read more
Retirement Planning
New laws to boost women's retirement savings through paid parental leave
The Australian Parliament has passed new legislation that will see superannuation guarantee contributions paid on the Commonwealth Government's Paid Parental Leave (PPL) scheme. 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
The downsizer dividend: how Australia’s ageing shift will reshape property, finance and AI strategy
Downsizing is moving from a personal milestone to a system-level lever for Australia’s housing market. As policymakers court reforms and agents eye fresh listings, the real profit pools will accrue to ...Read more
Retirement Planning
Half of Australians financially insecure about retirement as AMP launches new initiative
In a significant move aimed at addressing the retirement concerns of Australians, AMP has unveiled the Retirement Confidence Pulse, a national barometer designed to gauge the financial confidence of ...Read more
Retirement Planning
North introduces Grow to expand Australia's financial advice footprint
In a bid to bridge the gap between the demand for financial advice and its accessibility, North, a prominent platform for superannuation and retirement in Australia, has launched an innovative ...Read more
Retirement Planning
Majority of Australians anxious about retirement as super knowledge gaps persist, report finds
A new study by Aware Super has revealed that a significant majority of Australians aged 45 and over are feeling anxious about retirement, with nearly nine in ten respondents concerned they will run ...Read more
Retirement Planning
AMP’s MyNorth Lifetime boosts financial security and retirement income
AMP has reported that its MyNorth Lifetime retirement income solution is delivering significant financial benefits to retirees, with an average uplift of 50% in total income. Read more
Retirement Planning
Retirement living sector calls for planning reforms amid declining construction confidence
The Retirement Living Council (RLC) is urging governments to streamline planning systems to boost housing supply, following a decline in confidence in age-friendly construction activity. Read more
Retirement Planning
New laws to boost women's retirement savings through paid parental leave
The Australian Parliament has passed new legislation that will see superannuation guarantee contributions paid on the Commonwealth Government's Paid Parental Leave (PPL) scheme. Read more
