YourLifeChoices reveals the biggest drain on retirement savings

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The rising costs of energy are starting to bite retirees hard, according to the data from YourLifeChoices’ Retirement Matters survey.

Nearly 6000 members took the time to complete the survey on a range of topics related to retirement, and findings showed that there was a variety of opinions when it came to the biggest drain on financial savings.

The question asked members to rank eight different expense areas (healthcare, energy costs, housing, insurances, recreation, transport, food and drink, and communication) in order from the smallest drain on their savings to the biggest, on a scale of one to eight.

Energy costs came out as the biggest drain on the savings of retirees, which is no surprise given the way they continue to spiral out of control. However, energy costs were only narrowly ahead of healthcare costs (5.56 compared to 5.36) as a weighted average. Insurance costs were not far behind the leading two either, at an average rating of 5.16.

While energy costs had the highest total average, more people (22.82 per cent) rated healthcare costs as the no.1 biggest drain on their retirement savings than they did energy costs (21.61 per cent).

At the other end of the spectrum, recreation was considered the smallest drain on retirement savings, with more than a quarter of respondents (27.88 per cent) rating it as such, perhaps reflecting the fact that recreation expenses are non-essential for those who are in the cash-strapped retirement tribe.

Housing expenses also provided some interesting results, perhaps reflecting the difference between those who owned their own homes outright and those who didn’t.

There were 16.55 per cent of survey participants who considered housing expenses as the biggest drain on their retirement savings. However, 19.11 per cent considered it the smallest drain on their retirement savings.

Do these survey findings reflect your own view of retirement expenses?

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Written by Ben

52 Comments

Total Comments: 52
  1. 0
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    Got the cheapest internet plan one can get but it is still the biggest drain on my retirement.

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      OG (and others) my NBN to the curb plan is 60.00/month so that’s probably as cheap as you get! Much to my irritation SBS on demand and Iview keep dropping out and didn’t before. Iinet keeps suggesting that if I upgrade my package by 20.00 a month it won’t do it as much. I don’t watch Foxtel or Netflix, don’t download naughty stuff and there is just me so the bigger cost packages will largely go to waste. Does your ‘cheap’ package drop out during peak periods? I’m really loathe to buy something I don’t need!

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      What do internet plans have to do with anything.

      Electricity – get yourself a $4000 system and do not use energy as though it is free. The problem is people in all walks of life live unaccountably and then complain “they have no money”. It is mostly BS and complaints from those who have no self restraint or are unwilling to cut back.

      Health Care – a tough one….but we have Medicare. Go to the Unites States and see if the government is going to pick up the tab. Third world even worse.
      We have luckily been in good health so far apart from self inflicted injuries so we play the health care game. You have to be somewhat philosophical and not hang on to life too hard if things go against you. I have seen cancer sufferers who keep getting the next bout hang on like the clappers when it might be more appropriate to cash in the chips and thank God for a good life if they had one.

      I have written before that retirees who own their own home and are on a full pension cannot help but do well as long as they are not too indulgent and live to the lifestyle they can afford rather than the one they demand.

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      Mine is $60 a month too and includes my landline and all calls except 1300 ones. I have wireless NBN that does lose it signal occasionally but streams on demand very well. We have a smart TV and can stream SBS on demand on it via WIFI without any issues.

      Mick my solar panels and solar HWS cut my electricity bill down to very little.

      Health I have good private health care and get bulk billed. Health fund pays for 2 dental check ups a year and new glasses every year. I have had cancer twice so know how harrowing that can be too.

      I only buy what I need and yes I stick to a shopping list when grocery shopping. I find that as I age I need less and less material things.

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      I understand the battle between the haves and have nots. Given the greed of the top end for an ever increasing cut of the (limited) pie average citizens have no choice other than to tighten their belts and begin going without. Having said that there is wriggle room for those who CHOOSE to help themselves. Your account is testamy to that. It can still be done.

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    Private Health Insurance is Number One for us – roughly $95 a week for the 2 of us. Live in a place where we do not need a car and that helps. Electricity is no problem with $3 a day normally, air con of course higher.

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    Private Health care. Electricity. Fuel. Insurance. Council rates, get absolutely nothing in return for $1500 per year, except emptying rubbish bins. Roads are stuffed where I live and they do nothing to keep them maintained or SAFE. Of course how could I leave out bank interest on meagre savings.

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      Count yourself lucky, clarkey, our rates are $2000 a year and that’s after the pension rebate. Only a country town, mind you, not all services available either.

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      Cowboy Jim, my experience living in a large country town was that the rates covered both council and water. Our rates are about $1400 (after pensioner rebate) but we also have a water rates bill of about $1100 (after pensioner rebate).

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      Old Man wow those water rates are incredible! I’m on a septic so pay bugger all for water. Sympathy!

      Cowboy what really irks me is my neighbour pays half that and he has a ten acre property, no livestock, just the land and he pays half of what I pay for 5 acres. I queried it and they told me it was set on what I paid for the place 5 years ago. Still cannot figure that one out and don’t want to waste my time going to the people who set the rate prices in NSW.

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      Rates for me $3500, VIC large VIC town, residential block, 898 sqm

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      Greg – labor government and labor council – say no more

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      olbaid, hear hear.

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      You are correct larky. Pay no attention to the government sponsored trolls pushing the LNO wagon. None of the serious posters give these comments any credence because they are political BS.
      You sound like you live in my area. Certainly all of the things you mention are the doing of right wing governments of all manner who have not only run up huge debt but also made sure the club did well whilst average citizens paid and paid and paid. Tax cuts anyone?
      Shorten sure ain’t the sharpest tools in the shed but he is no Daryl Maguire either no matter how hard the trolls try to insinuate that.
      Bring on the election and lets get it over and done with. I’d like to see the propaganda TV stations choke on their own spew as their relentless promotion of their man (now Morrison) counts for zip. We’ve all had enough of the lying deceitful bastards who claim to be doing the work of the nation. I know a traitor when I see one!

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      I e-mailed an Objection to my local Council (live 25kms from Central Melb on an average size block & home now 50yrs old) after received current 2018-2019 rate notice as the CIV had increased by just short of $200,000 (20% above last yrs rates). Well worth it, cut the CIV increase down to a $115,000 – not a big $ saving re rates payable, did it for justice.

  4. 0
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    I keep my expenses as low as I can but need my airconditioning when it is hot in Summer because of a serious medical problem. My luxury that was reduced was eating out. It is now special occasions only.

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      Blossom, you can 17% off with a medical condition. Check with your state and doctor to receive that.

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      Blossom you should be able to get assistance for electricity , Check with your state and federal government for special concessions. You will probably need to fill out a form via your GP

  5. 0
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    Living in a rural area our biggest expense would be petrol as we have to drive to the nearest city every week, sometimes twice a week for medical appointments. Although our little town has doctors, dentists, optometrist, a grocery store, several cafes, hotels and thrift shops, unfortunately medical specialist and imaging services are all in the city.

  6. 0
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    Maybe winter gas bill is a problem but if you have solar on your roof then electricity is not. One of our neighbours covers her gas as well from what she earns from the solar. Food should be the top expense if people are eating well and that does not count unnecessary restaurant eating as that is not possible for many anyway. Health is a big expense for the elderly with scripts until they reach the safety net, private health cover, vitamins like vitamin D and fish oil, etc. as well as any pain relief they need for arthritis, etc.
    Internet is under $100 a month so not sure what other people have that inflates that. This covers entertainment as well in ours.
    Hence, health comes in as our big one if food is not counted.

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      Our internet is more than $100 but it does include the phone as well within Australia and 20 countries world wide.

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      Cowboy Jim, all our calls are covered too. One thing not covered in that is my mobile. Netflix and Foxtel now are included however. Unlimited downloads and uploads! Pretty good for just over $20 a week. We are mostly home too so important to have our entertainment covered.

  7. 0
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    We live in Townsville, and when I retired I thought I could at last kick-back and enjoy our last years together. The last couple of weeks has shaken this to the core. First an electricity bill of $670 – twice as much as I was expecting. So I read the meter myself and sure enough “Meter reading error”. (I was told there was a $40 call out fee to re-read it, waived if I was right. I stuck to my guns.

    Then a letter from a pest control company stating that our annual termite inspection was due, ($199) and if they performed pest inspection at the same time we could save and it would only cost us $388. The name puzzled me, and a sentence that read that a chemical termite barrier had been installed during construction. As the house is over 60 years old alarm bells rang and I checked the last bill -paid in March, and contacted our regular pest control company. They asked me to scan the letter and email it to them to investigate.

    I’d like to know how this “company” got hold of our name & address details. But what pains me more is that someone thought … retired couple, own home, soft touch. .

    I hope you will print this as a warning to other retired people.

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    Our electricity is not yet a problem and we don’t consider having various insurances as an imposition. I like the definition of insurances, each year we bet the insurance company that our property will disappear and wager about $1,000 against their $450,000 and each year (thankfully) they win.

  9. 0
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    Private health insurance, Body Corporate fees and council rates along with energy and phone/NBN are my largest bills. Body Corporate fees are my biggest worry.

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      Agree! My 91 year old mum has to pay Body corporate fees that are a disgusting rip off! I told her I would come to a meeting to see what is going on but she said no. She doesn’t want any problems after I go home, from the BC thieves.

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      Yes Strata Fees, rates and water are expenses that renters don’t have and none of them do you have much control over.

      I wonder how many of the survey respondents were homeowners to put housing expenses last in priority? Renters have none of those worries. Something breaks, leaks, falls over they just call the agent or landlord and get it fixed. Not so simple for us ‘lucky ones’ who own our home.

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      We pay Body Corp fees, they include the water rates Old Man. So we pay it on BC rather than Council. Had a look at the total bill, wife goes to meetings. The largest slice is the compulsory insurance, about 45% of total bill.
      Of course if you own your property outright, freehold with no mortgage, you do not have to have your place insuranced, but then people like that find themselves on Current Affairs with crying people in front of a burnt out house and a “fund me” plea at the bottom of the screen.

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      A lot of laments but you have to remember the old adage what none of us can avoid, death and taxes.
      The real issue for many Australians is that we are seeing rampant inflation with incomes pretty well stagnant whilst those who govern us shrug their shoulders and quote official nonsense inflation figures which any nitwit who buys the weekly food and many other necessities of life knows is a con.

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      My weekly food bill has hardly changed in the last 6 years
      In fact meat and veggie prices have gone down while non perishables can be bought on offer or in bulk at extremely low prices

  10. 0
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    Electricity health insurance and the internet are a to keep a major cost for me. I am home more and budget conscious. I changed health insurance and saved 6.00 a fortnight. Changed electricity providers due to a government offer in my state which means reduced energy charges, As for the internet I pay 99.00 via Telstra .No phone calls and silent line no charges. Cheapest plan in my area and still feel that I am being ripped off. You just have to keep an eye out for better deals even though it is pain to switch over.

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      I pay $55 per month for NBN 500GB + free phone line but 10 cents per call. Spintel is the company I use. 50 mps d/load and 20 upload. Not that much faster than ADSL but I had no choice as NBN is fully installed in my area and the were cutting off the old system.

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      Car/health/home & contents insurances, Council Rates & elec/gas/water (have ducted gas heating + gas hot water/ducted elec cooling+++) are my biggest costs. I’m frugal with heating & cooling. Approx $67mthly for internet & national landline (just in case) & my dear old Nokia mobile phone is $30mthly which includes everything I want/need & use often daily. Grateful to spend an extra approx $80/wk on my safety, my big now 4+yo super smart, caring & protective male Border Collie (don’t think I’ve had a drink or meal w/out his luscious long locks in it for 4yrs) however never felt so very secure as he jumps up to nearest window when hears the outside sensor lights come on even when TV volume up if I’m in another room (my hearing is 100%, had free check-up 3mths ago) which I can’t hear as very slight low vol little clicks unless standing o/side & close to ’em – the only cost I’m really happy with as includes all his treats/Gourmet tucker/de-worming/pest control (groom him myself, easy as loves catching raindrops & hail stones then just brush & dry him). He’s heaps of fun, a laugh a minute – keeps me fit, no need for gym. Also not concerned abt my own food costs, haven’t changed much altho’ have cut back my fav T-bone steaks to just one a wk, easy. All 3 utilities are my biggest cost increases, followed closely by Health Insurance & Council Rates – all are essentials for we seniors/OAPs (any current discounts should be much higher).

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