The amount of money Aussies will need to retire to maintain their living standards has increased by as much as 8 per cent.
According to the latest figures from Super Consumers Australia, an independent organisation that has partnered with CHOICE, its revised retirement targets reflect cost of living increases and higher rates of the Age Pension.
These figures are about 3 per cent to 8 per cent higher than the savings targets the consumer advocate organisation released in July last year.
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For pre-retirees aged 55 to 59 who are living on their own and would like to spend about $36,000 a year in retirement (a figure Super Consumers Australia has classified as ‘low”) they will need to have saved $91,000 by the time they are 65 years old.
For singles who want to spend $47,000 a year (medium) they would need $317,000 in super, while those who would like to spend $59,000 (high) would need to have saved $777,000.
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For pre-retiree couples who would like to spend a combined figure of $69,000 (medium) a year, they would need to have accumulated $425,000 in super.
Aussies aged 65 to 69, who Super Consumers Australia classifies as current retirees, looking to spend $41,000 a year (medium), would need to have saved $279,000.
To spend $55,000 (high) a year, a retiree living on their own would need $795,000 in their super.
The savings targets factor in additional income a retiree may receive from the Age Pension, and also assume the person will own their own home.
While the targets have increased compared to last year, the superannuation advocacy group said Aussies who had super in a balanced fund would have seen their balances grow by about 9 per cent over the past 12 months.
The super guarantee, the amount of super an employee has to pay their worker, has risen by 0.5 per cent to 11 per cent, another factor which should help take the pressure off retirees.
The Age Pension has also increased, with single Aussies now entitled to about $27,000 a year, while couples will receive about $20,000.
For renters however, putting more money into their super is easier said than done.
Super Consumers Australia said renters often did not have enough spare income to contribute more, and usually experienced higher levels of financial stress.
“Consumer advice to contribute more to super is often not realistic for this group,” Super Consumers Australia director Xavier O’Halloran said.
“Much more needs to be done to create affordable housing if more renters are going to avoid poverty in retirement.”
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