Retirement
How Australians are faring in saving for retirement
Nearly 5.5 million Australians struggle to meet their future needs in retirement. How do your savings stack up?
How Australians are faring in saving for retirement
Nearly 5.5 million Australians struggle to meet their future needs in retirement. How do your savings stack up?
The state of play for retirees
Research conducted by Roy Morgan suggests the average gross wealth (total assets excluding owner-occupied home) is $299,000. The average debt level for the same group is $27,000, reducing the net wealth of soon to be retirees to $272,000.
Household Capital chief executive officer Josh Funder believes funding for retirement is a significant issue for a majority of Australians.
“Roy Morgan’s figures tie in with our research; for many Australians, compulsory super started too late into their working lives,” Mr Funder said.
More than 5.5 million so-called Australian Baby Boomers (those people born between 1946 and 1964) have entered or are about to enter retirement.
“As subsequent waves of Baby Boomers approach retirement, inadequate funding looms as a major socioeconomic problem that must be addressed,” Mr Funder said.
Where has all the money gone?
For most Australians, the majority of their wealth is tied up in their family home. At retirement, the family home plus superannuation may be worth seven figures, but this is locked away.
“In fact, there’s nearly $1 trillion in untapped home equity owned by Australian retirees. Given that most retirees wish to stay in their own home as they age, this untapped savings is a valuable resource that could be used to improve retirement funding,” Mr Funder said.
New options on the market
With so much capital being left in the family home, Mr Funder believes Australians need to utilise their home equity, albeit in an efficient, responsible and sustainable way.
“Clearly, a new and innovative approach is required to meet this major unmet community need and delivered in the context of financial advice and long-term retirement planning,” Mr Funder said.
Drawbacks of reverse mortgaging
According to the ASIC, there are a few drawbacks to new options on the market, like reverse mortgages.
By taking out a reverse mortgage, individuals can face financial difficulties later in life because of interest rates, increasing debt and the effects of compound interest if the value of the property does not rise.
RELATED ARTICLES
About the author
About the author
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
Planning systems under scrutiny as Australia's ageing population grows
The Retirement Living Council (RLC) has called for governments to address planning system shortfalls in preparation for Australia's ageing population, following the release of new data from the ...Read more
Retirement Planning
Retirement Living Council calls for focus on seniors' housing as population ages
The Retirement Living Council (RLC) has urged governments across Australia to prioritise age-friendly housing solutions in response to new data revealing an ageing population. Read more
Retirement Planning
Macquarie University study reveals benefits of guaranteed income in retirement
A new study by Macquarie University's School of Psychological Sciences has found that mental health, enjoyment, and financial security are key benefits of incorporating guaranteed income and annuities ...Read more
Retirement Planning
Retirement villages offer affordable housing amid market crisis, study finds
Retirement villages are providing a significantly more affordable housing option for older Australians compared to the traditional property market, according to new data released today. Read more
Retirement Planning
Age-appropriate housing could reduce hospitalisations for elderly Australians, report finds
A new report from the Australian Institute of Health and Welfare (AIHW) has highlighted the potential benefits of age-friendly housing in reducing hospitalisations among older Australians. Read more
Retirement Planning
Retirement Living Council urges focus on seniors' housing as population ages
The Retirement Living Council (RLC) has called for a renewed focus on retirement villages as a key housing solution to cater for Australia's ageing population, following the release of fresh ...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
Planning systems under scrutiny as Australia's ageing population grows
The Retirement Living Council (RLC) has called for governments to address planning system shortfalls in preparation for Australia's ageing population, following the release of new data from the ...Read more
Retirement Planning
Retirement Living Council calls for focus on seniors' housing as population ages
The Retirement Living Council (RLC) has urged governments across Australia to prioritise age-friendly housing solutions in response to new data revealing an ageing population. Read more
Retirement Planning
Macquarie University study reveals benefits of guaranteed income in retirement
A new study by Macquarie University's School of Psychological Sciences has found that mental health, enjoyment, and financial security are key benefits of incorporating guaranteed income and annuities ...Read more
Retirement Planning
Retirement villages offer affordable housing amid market crisis, study finds
Retirement villages are providing a significantly more affordable housing option for older Australians compared to the traditional property market, according to new data released today. Read more
Retirement Planning
Age-appropriate housing could reduce hospitalisations for elderly Australians, report finds
A new report from the Australian Institute of Health and Welfare (AIHW) has highlighted the potential benefits of age-friendly housing in reducing hospitalisations among older Australians. Read more
Retirement Planning
Retirement Living Council urges focus on seniors' housing as population ages
The Retirement Living Council (RLC) has called for a renewed focus on retirement villages as a key housing solution to cater for Australia's ageing population, following the release of fresh ...Read more
