Retirement
How long will your savings last? Global giant weighs in on Aussie finances
Retirement
How long will your savings last? Global giant weighs in on Aussie finances
Despite having one of the most advanced superannuation systems in the world, most Australians are in for a rude awakening come their mid to later life, according to the World Economic Forum (WEF).
How long will your savings last? Global giant weighs in on Aussie finances
Despite having one of the most advanced superannuation systems in the world, most Australians are in for a rude awakening come their mid to later life, according to the World Economic Forum (WEF).
The WEF suggests that Australians will have enough savings to last 9.7 years into retirement.
Men will run out of super on average 9.9 years before they pass away and females will outlive their savings by 12.6 years, according to the report.
What is Australia doing to address this?
The WEF believes the Australian system is one of the most well-developed from an accumulation perspective but has an underdeveloped framework when it comes to retirement.
In a recent speech at the Bloomberg Buy-Side Forum, Assistant Minister for Superannuation, Financial Services and Financial Technology Ms Jane Hume addressed this shortage.
In her speech, Ms Hume outlined how the government planned to make sure funds in retirement phase continued to work hard for members in order to help address this issue.
“There is work to be done to ensure that retirees’ money continues to work hard in that retirement phase. Currently, there is very little guidance on how retirees should draw down their savings when they reach retirement,” Ms Hume said.
“The government is addressing this by developing a retirement income framework which will include a covenant required for funds to develop a retirement income strategy for members,” continued Ms Hume.
The fine print
The figures from the WEF are based on starting contributions of 3 per cent of $30,000 salary, which is increasing by 1 per cent a year to 9 per cent and adjusted for salary growth and inflation.
In the study, it is concluded that retirees will reduce spending to 70 per cent of their final pay income. The WEF’s report states that there is growing evidence that spending habits change, meaning investors might actually spend less than 70 per cent of their superannuation.
RELATED ARTICLES
About the author
About the author
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
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 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
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
