Aussies believe things look dire for when they retire

A majority of Australians want to see the Age Pension increased amid fears that they won’t have enough money to retire comfortably when they stop working.

The Australian National University (ANU) has released data from a longitudinal survey of 3459 Australians that found 70.5 per cent thought the current Age Pension wasn’t enough, while a minority of respondents (21 per cent) thought it should be roughly equal to its current rate.

The average Age Pension payment supported by respondents was $1115 per fortnight for a single.

One of the surprising findings was that older Australians (those aged 55 years and over) have a lower preferred Age Pension rate than the average response.

The report found that this may indicate that their personal experiences on receiving the Age Pension, or closer interactions with others on the Age Pension, resulted in them feeling that the payment is overly generous.

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There was also significant change in the number of people who thought that everyone should receive the full amount of the Age Pension as a right.

Nearly 27 per cent of people thought this way in early 2021, when the survey was conducted, which was up from 16 per cent when this question was last asked in an ANU poll in 2015.

The survey also found that 56 per cent feared that they wouldn’t have enough savings for a comfortable retirement, which was up significantly from 40 per cent when the question was asked in 2015.

Report co-author Professor Nicholas Biddle said that the COVID-19 pandemic could be responsible for the drop in retirement positivity.

“In early 2021, as Australia was continuing to emerge from the COVID-recession, the majority of Australians who weren’t currently retired thought that they would not have enough money when they did,” Prof. Biddle said.

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“Of those Australians who say they are worried about not having enough money in retirement in 2021, females, people who hadn’t finished year 12 and those living outside capital cities were most concerned.

“Our study shows a large increase since the last time we asked this question in 2015, when only 39.6 per cent of Australians thought they would not have enough money to live comfortably.”

According to the findings, 38 per cent of Australians think they will have enough savings to live comfortably in retirement – a similar level to 2015 when 39 per cent of people said the same.

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“But we have seen a very large decline in the per cent of people who said they definitely would have enough money – 21.3 per cent in 2015 compared to just 6.1 per cent in 2021,” Prof. Biddle said.

The only good news from the survey was that those who had already retired were much less worried.

More than 71 per cent of those who had already retired said they definitely, or probably, had enough money to live comfortably for the rest of their retirement.

The survey also found strong support for the legislated increase in the superannuation guarantee, with 55 per cent supporting the increase to 12 per cent by 2025 and a further 21 per cent thinking that the rate should be even higher.

Asked whether they would use their superannuation for other purposes if they could access their savings early, 47 per cent of people said yes.

Of those, 26.9 per cent said they would use it to purchase a home or reduce their mortgage, while 10.2 per cent said they would use their savings to meet current living expenses.

Would you like to see an increase in the rate of the Age Pension? How much do you think a single pensioner should receive per fortnight?

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Written by Ben