Older Australians are entering retirement more than $158,000 in debt

An increasing number of older Australians are retiring burdened with massive debt.

Older Australians are entering retirement more than $158,000 in debt

Many older Australians are failing to pay off their homes prior to retirement and, as a result, face the prospect of living out their end-of-work days with a mountain of debt still to repay.

According to research by ING Direct, in 2015, thousands of Australians aged between 65 and 80 owed an average on $158,500 on their mortgage.

The increase may be blamed on the rising cost of housing, as well as borrowers buying their first houses much later in life – some maybe too late. The average age of a first home buyer is now over 31 years of age, meaning it’s more likely that they’ll retire in debt.

“We’re seeing more Australians carrying over into retirement with debt,” said ING Direct’s Tim Newman. “If you buy in your mid-30s it’s likely you’ll still carry debt when you retire … people are borrowing more at a later age.”

What is concerning to Mr Newman is that people borrowing so late in life may not have truly considered how they will pay back their loans, which may mean that downsizing to release equity is the only way to repay debt.

Another way Australians heading towards retirement may choose to clear debt is to use a superannuation lump sum to pay an outstanding mortgage, which could put increased pressure on our Age Pension system.

Although housing prices may be partly to blame for debt, there are also many Australians who, according to Curtin University’s Bankwest Curtin Economics Centre associate professor Rachel Ong, “dip into their housing wealth to meet spending needs”.

“They typically do this through the use of financial products that allow them to withdraw equity from their home by increasing the mortgage debt secured against the home,” said Ms Ong.

According to the Association of Superannuation Funds of Australia (ASFA), single retirees will need $23,651 per year to live a ‘modest’ lifestyle, with couples requiring $34,064 to do the same. Whilst this figure takes into account home maintenance, improvement and insurance, among other things, it does so assuming that the home is fully paid for. So for retirees who rent, or who have large debts, living comfortably, or ‘modestly’ in retirement becomes a difficult proposition.

The research underlines the importance of sound financial planning at all stages of life, but with the Australian financial planning industry currently lacking sufficient credibility, once again, the risk of funding your retirement is all yours.

Are you still repaying a mortgage? Or are you debt-free? Do you have any tips for people who may be in debt?

Read more at www.domain.com.au

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    COMMENTS

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    Mojobomber
    13th Jun 2016
    9:01am
    Sorry, unrelated, but the link to which is the correct concession card isn't working.
    Queensland Diva
    13th Jun 2016
    9:42am
    Me either Mojobomber - must be their site
    Anonymous
    13th Jun 2016
    9:49am
    Crickey, MY card article isn't there EITHER!
    Polly Esther
    13th Jun 2016
    11:35am
    and the queen has just ignited Rod Stewart :-) :-)
    Anonymous
    13th Jun 2016
    12:17pm
    Yes, it was very kindle of her.
    TREBOR
    13th Jun 2016
    1:14pm
    .. brings tears to your eyes and a frog in yer throat....
    Kaye Fallick
    13th Jun 2016
    3:14pm
    Hi Mojobomber and Qld Diva - apologies but thanks for telling us re faulty link - now working warmest, Kaye
    Jilly B
    13th Jun 2016
    9:20am
    I especially like the statement by ING so I request that they consider that people are working a lot older in these modern times. My Life Insurance is increasing by over AD500 each year and the insured person is only 63years of age. As he will not pay any of the contributions as they will not benefit him I am left to pay the lot. In years gone people retired at 60, 65 or earlier but now we are working longer so I expected that Life Insurance would not go up at this rate at this age. It will become impossible for me to pay this amount after I reduce my working hours so all the money and the security it provides will be lost. They changed the age that one can still pay the policy to 90? so they want it all their way.
    MICK
    13th Jun 2016
    11:57am
    Not at all sure that the story is factual.
    Anybody who takes a mortgage at 31 will have it paid off at 61 because banks only give (maximum) 30 year loans.
    The likely culprit is more than likely people upgrading houses along the way rather than not paying off their FIRST homes.
    Dancer
    13th Jun 2016
    12:30pm
    Yes, I agree Mick - I wonder if many people in their 40s and 50s are choosing to "upgrade" their homes to bigger (more expensive) homes in expensive areas - obviously with another mortgage - and that is why they don't pay off the mortgage before retiring, especially if they are caught out and made redundant before paying off the mortgage.
    LiveItUp
    13th Jun 2016
    12:38pm
    If I was still working I'd be buying a more expensive house and using my super to pay off the debt when i retired. It is just a good way of keeping the value of your assets so you qualify for the pension.
    Anonymous
    13th Jun 2016
    1:33pm
    I know of a people who did just what you said Bonny. Built $2 million home to qualify for part pension.

    However,her hubby died, wife could not handle the upkeep, cleaning etc of home and has now had to downsize and of course has money in the bank after purchasing a unit for $500,000 plus.

    She is worrying herself sick that she will no longer quality for a small part pension even though her husband was an international pilot and went out on a pretty good pension.

    I think it is ridiculous she is living well but has the mindset that she "must" have access to the lurks and perks of the pension. Does not want to spend her own money to keep herself when in fact she has more than enough to see her out. She is in her late 70's.
    LiveItUp
    13th Jun 2016
    1:54pm
    Yes I see that happen regularly too and worse of all are my own relatives. I rarely have contact with some of them now because they whinge too much for me to take. It is simply sad that some only come to see me as they want money even though they have been big income earners all their lives. A relative died last year and left another relative some money. That relative was very annoyed about it and came to see me because if they accepted it they would lose their pension. There was more enough money left to them so they could live comfortably the rest of their life. No matter how I put it to them they just couldn't let their oension mentality go. Very sad really knowing that they could now cruise in a suite whereas before they were lucky uf they could go stearage.

    13th Jun 2016
    9:21am
    I have no sympathy whatsoever for these people, the same as I have none for the ever-increasing number of people who ask for donations to help bury loved ones, or for money when their un-insured house burns down. They are the leeches of society with no forethought who will never learn how to stand on their own two feet.
    Anonymous
    13th Jun 2016
    9:36am
    In general, I agree Fast Eddie. There are exceptions. Some people face a genuine crisis that was totally unexpected and couldn't reasonably be planned for. Low income earners struggle to maintain adequate insurance for all contingencies, and often just have to rely on a ''hope and a prayer''. I know couples who lost their homes when interest rates soared to around 18%, and never recovered. One such couple is fortunate to have an affluent son who bought a house with a lovely large granny flat attached and rents it to them very cheaply. But without that kind of help, they would really be ''up the creek''.

    At around 4% interest, it would certainly be cheaper for most retired couples to owe $158,000 on a home than to be renting.

    The real problem in our society is that while there are genuinely needy folk, the majority of those who claim hardship are in their current circumstances because they lived it up earlier in life. I know one who lives on a pension in public housing and complains of struggling to get by (despite children paying for her annual holiday and having bought her a used car recently) but she was a high income earner, married to a high income earner, inherited money, but freely admits to having spent it all travelling the world. ''No regrets there'' she says! Fine. But why should folk who went without such luxuries to try to be self-sufficient in old age now be deprived of benefits to fund pensions for folk like her?

    I wish I knew the answer to this dilemma. I can't see how people's earlier spending habits can be accurately assessed to determine entitlements to pensions, and even if they could we can't leave people destitute just because they were irresponsible. But on the other hand, if we keep bashing the battlers who strive and plan and save, we will have a lot more irresponsible spendthrifts to support.

    Ultimately, I think removing the means test and paying everyone the same pension rate in retirement, then taxing retirement income might be the fairest and most productive approach for the nation. Or, better still, introduce a basic income for all. It would solve a host of problems and put restore incentives and rewards, which would drive major productivity growth.
    LiveItUp
    13th Jun 2016
    10:42am
    Sounds like a great idea Rainey. I could buy myself and expensive house and live on the pension. My kids would then get everything tax free when my house more than doubles in price. They would pay all the outgoings so that I could use the pension for my personal enjoyment.

    Then again I can already do this now and get the full pension while living in my $20 million house by the sea with awesome views.

    Me thinks I like the idea.
    LiveItUp
    13th Jun 2016
    10:50am
    I agree with Fast Eddie people just wing it without planning anything. Then they cry poor when disaster strikes. A bit of planning and discipline is all that is needed not expensive insurance policies. Insurance is just a lottery you buy a ticket in hoping you never win. I have never had life insurance or furneral insurance but I do have car insurance and had house insurance when I owned a house. I don't have disasters I just have inconveniences in my life now.
    ex PS
    13th Jun 2016
    11:21am
    I really think that for every freeloader there are 1000 genuine people who need support and deserve it. How to sort them out is always going to be the question, unfortunately we often find it costs more to find and sort these offenders out than we ever get back.
    I would rather give ten people something they don't deserve if it meant that one deserving person wasn't left without.
    Maybe the answer is give everyone who applies for it a pension based on a self assessment, then introduce spot checks, anyone found rorting can then pay half of their assets as a fine.
    LiveItUp
    13th Jun 2016
    11:38am
    It is no hard to not own anything but control everything. Many people today use this strategy so that their assets are protected if they are sued.
    MICK
    13th Jun 2016
    12:00pm
    Bronny, Bronny, Bronny. You know full well that if this government is elected with a majority in the senate (not happening!) then it would not only bring the family home into the assets test but also reintroduce Death Duties. It goes without saying that the wealthy would tie their own assets up in companies and Trusts to avoid same.....but mums and dads would get caught. Sound familiar?
    LiveItUp
    13th Jun 2016
    12:11pm
    Mick death duties will not worry me at all.
    Anonymous
    13th Jun 2016
    1:34pm
    Death duties do not worry me either. When I die that is it.
    Anonymous
    13th Jun 2016
    2:42pm
    I don't know why I bother to challenge MICK but I suppose this time he has gone over the top. There is no proof whatsoever that the family home will be included in an asset test nor have death duties been mentioned. Typical Labor scare tactics.
    Sceptic
    13th Jun 2016
    4:08pm
    Yes Old Man, a bit like Bob Hawk saying in his ad that there is a task force looking at privatising Medicare. A complete fiction by Labor. And doesn't he look sincere - I don't think.
    Anonymous
    13th Jun 2016
    5:09pm
    Sceptic, he looks pretty good for his age - almost alive.
    MICK
    13th Jun 2016
    5:18pm
    And the normal LNP trolls rolled out.........just like they brough John Howard back (is he still alive?).
    Hawke hit the nail on the head when he said (short and sweet) that the LNP would not be doing a study into Medicare if it did not intend to privatise it.
    Voters beware. The wolf in sheep's clothing is waiting to pounce. A pity the LNP is set to lose the election. It will however be interesting at the mix...and I hope that Xenophon and his team cream both sides. Needs to happen.
    LiveItUp
    13th Jun 2016
    5:58pm
    Who believes Bob Hawke after all his antics? Best not to go there though. Privatising Medicare is Labor propaganda.

    LNP will win and odds are getting shorter. If anything they are bith concerned about minor parties taking away their votes. Looks like another 1095 days of LNP government.
    MICK
    13th Jun 2016
    8:33pm
    Refresh my memory............Hawke Labor government brought in Medicare. Labor brought in universal superannuation, the NBN and more.
    Can't remember what the LNP ever did? Oh yes....tax cuts for the rich and Baby Bonus.
    LNP will lose despite having the media running its campaign and despite lies on steroids promoted by the media.
    LiveItUp
    14th Jun 2016
    8:18am
    Medicare is just a way doctors can make lots of money from the government without much accountability. Super is a dream for the big money institutions to make a motza out of people's retirement money. Many are no better off. NBN is superceeded technology that is very expensive and not very robust. Wireless technolgy far more robust, far less expensive and more expandable in the future.

    Better to do nothing then do something very badly. A lot less debt burden to carry.

    LNP has it in the bag Mick.
    Anonymous
    15th Jun 2016
    10:00am
    Suggestions that LNP will include the family home in the means test aren't verified. True. But they SAID ''No changes to pensions''. Bottom line: they lie and lie and lie and lie, and if it's cruel and destructive to social welfare, they WILL do it. It's just a question of when!
    Franky
    13th Jun 2016
    9:33am
    Living debt free in one's own home should be the no. one priority in Australia. We never went into debt for our own home, but rather traded up and bought what we could afford. I am grateful to my parents who brought me up with the ethics that one first has to save before buying, and not living beyond one's means. For anyone who wants to learn about sound financial management there is a great book called "Rich Dad poor Dad" by Robert Kiyosaki. There is good debt and bad debt, it's important to differentiate between the two!
    On the subject of today's housing costs, it's obviously a problem of shortage of land releases. The cost of building has not increased beyond inflation. So why is there a shortage of land releases? If you live in a big city where prices have been driven up by overseas buyers, maybe we should look at the system that exists in most of Asia, where foreigners can't buy and own land - they can lease it and use it for a defined term, after which it reverts back to the original owner. This keeps a lid on foreign investment in housing, and that investment would flow more into commercial activities benefiting the country's economy.
    Anonymous
    13th Jun 2016
    9:47am
    I agree with much of what you say, Franky, but you were very lucky to be able to buy ANYTHING to live in debt free. The situation we found ourselves in, with two young children, was that prices were rising faster than we could save and rent was keeping us poor. We eventually had to borrow way more than we could really afford, and buy.

    We settled for the cheapest house we could buy and renovated, then traded up. We owner-built homes and renovated old dumps (living in horrid conditions in the interim) to enable us to profit on sales and gradually increase both quality of home and equity in it. But we couldn't have done it without significant debt.

    In the mid-70s, we found that inflation was such that it was way smarter to borrow heavily and rely on wage increases to service debt than to suffer constant rent increases and watch house prices jumping every quarter. But we did focus on reducing debt and increasing equity as quickly as possible, thankfully, because otherwise 17%+ interest rates 15 years later would have wiped us out.

    I think what is needed in Australia is to introduce budgeting and financial management as a compulsory school subject - but the problem is devising a curriculum that really teaches kids what they need to know. There's a country mile between the theory I was taught in economics classes and the reality that I experienced. Very few really understand the challenges of poverty, the available solutions, and what one has to do to drag oneself up out of it. It's not easy, but it is achievable.
    LiveItUp
    13th Jun 2016
    11:19am
    All people need to do is spend less than they receive. It is not that hard but few manage it.
    LiveItUp
    13th Jun 2016
    11:21am
    Rainey a lot us went through those periods of high interest. I actually loved them and made a lot of money.
    MICK
    13th Jun 2016
    12:06pm
    Owning one's own home is the key to managing in retirement. A no brainer Franky!
    The release of more land is a way to get rents down a bit. The cost of building is high and vacant land has been locked up by wealthy Australians and their businesses and is only released in dribs and drabs to keep the price up....for them.
    To survive in the system we have people have to save hard from day one, pay off their debts as soon as they can and then put money away for retirement. Sadly genY is all about 'me' and the lifestyle 'I want to become used to'. And when they hit 40 it is mum and dad's fault that they do not have a home, not theirs.
    LiveItUp
    13th Jun 2016
    12:19pm
    I better buy one then Mick. Then again I manage quite well without one.
    MICK
    13th Jun 2016
    5:20pm
    Bronny: BS! You sound just like your LNP mates: full of dishonest rhetoric meant to deceive.
    LiveItUp
    13th Jun 2016
    7:02pm
    Odds getting shorter for a LNP win.
    MICK
    13th Jun 2016
    9:09pm
    Only in the right wing media outlets. Labor already ahead and voters will make a last minute decision to dump Turnbull because he has no credibility.
    LiveItUp
    14th Jun 2016
    8:11am
    Can't see the betting agencies being that wrong myself. People may vote independent but they fail to realise that they are really just voting for one of two parties.

    It wil make little difference to me personally who wins but for the sake of Australia we do not need another Labor government especially one governed by the Greens.
    Anonymous
    15th Jun 2016
    10:10am
    Bonny, it's a SICK individual who makes comments like yours on the high interest period. So you were LUCKY to have money to invest. Good for you. A lot of folk lost their homes - not through being irresponsible or spendthrift, but through misfortune or simply being unlucky enough NOT to have opportunity to pay off more or save before those rates hit. For my part, I was paying off debts for medical care for a disabled child - debts incurred partly because of a bureaucratic stuff-up and partly because I wasn't prepared to accept third-rate treatment. I wanted to give her the best opportunities available to overcome her disability.

    It's DISGUSTING that people like you are so hideously arrogant, self-opinionated, judgmental, and just plain NASTY. Have a little RESPECT. (Oh, sorry, narcissists are incable of that.)
    Mindy
    13th Jun 2016
    10:02am
    I agree with Fast Eddy, Franky & Rainey. However, if you look back over your life there were many turning points and some of us just lucked in by making one decision (be it for employment, driving decision, life partner, etc), the outcome of which could not have been accurately predicted.

    Judgement is a key skill for our young people - it is never 100% but it sure beats spur of the moment - which could have whole of life implications.
    LiveItUp
    13th Jun 2016
    11:14am
    The opportunity of a lifetimes comes around twice a week. There is no such thing as luck it is simply good management that gets results. If you don't plan how can you reach your goals?
    Anonymous
    13th Jun 2016
    11:39am
    Bonny, I disagree with you. There IS luck and there is luck in everything, but to different degrees for different people. But luck is something which cannot be ignored when it is bestowed upon you. It has to be re-newed or regenerated by a reciprocary action of generosity or kindness to someone or something if you want it to return. It is something you have to BELIEVE IN and MAKE happen. It is in that way similar to "faith". It DOES exist.
    LiveItUp
    13th Jun 2016
    11:44am
    I for one don't believe in luck and any success I have had has come from good management and planning. Sure I get lots of returns from my generosity but that is not luck.

    So I could concentrate on parking my car I used to get my kinds to imagine a parking spot at the front entrance of a shopping centre. If there was one there I told them that they did a good job imagining it but if there wasn't we all agreed they'd do a better job next time.

    Luck does not exist.
    MICK
    13th Jun 2016
    12:07pm
    Agree Mindy.
    Janran
    14th Jun 2016
    12:06pm
    I agree with you, Mindy, about being lucky.
    We bought our first home (a 60 yo weatherboard house on a flood-prone urban block with dual-occupancy zoning), only because my parents had both just died and so I had the 20% deposit. My temporary job in a Govt agency gave me enough paperwork (3 x fortnightly pay slips) to secure the mortgage. The temp job finished the week after we took possession.
    The house more than doubled in value in just 2 years. It was simply lucky timing, if you can call it lucky that my parents died. Friends and colleagues congratulated us for our business acumen, but it was just lucky timing.
    Granted, we chose that house for its potential value, not its lack of any storage cupboards or kitchen benches! People today are not prepared to sacrifice their living standards, not even temporarily, for the sake of getting into the housing market.
    Anonymous
    15th Jun 2016
    10:15am
    Bonny, you are an extreme egotist who can't acknowledge the truth,

    There is certainly a huge amount of LUCK in anyone's success, and many people DO NOT have much opportunity, no matter how carefully they plan or how well they manage.

    You DID NOT achieve success through planning and good management, but through pure LUCK, because if that were not the case, you wouldn't be an egotists and a narcissist and you wouldn't make the false claims you make here. People who make it through hard work and struggle against the odds DON'T become egotistical and judgemental and DON'T boast.
    tams
    13th Jun 2016
    10:03am
    This research shows the changing face of retirement income. I think these figures represent a number of differing scenarios.
    1) The Reverse Mortgage market is starting to gain traction under greater consumer protections. A reverse mortgage is not for everyone, but neither is a standard home loan or credit card.
    2) Superannuation is a nest egg which allows a lump sum withdraw, and those entering retirement, or post retirement can` repay an existing debt.
    3) A new trend is the majority of assets to be in the family home and either a standard home or reverse mortgage loan is used to fund retirement without affecting age pension entitlements.
    MICK
    13th Jun 2016
    12:08pm
    Spot on. But don't be surprised to see governments (both sides) come after the family home when the money they waste dries up.
    LiveItUp
    13th Jun 2016
    12:17pm
    The sooner the house is included in the pension assets test the better.
    Anonymous
    13th Jun 2016
    12:25pm
    For whom?
    LiveItUp
    13th Jun 2016
    12:31pm
    Everyone the current system is just so unfair.
    Anonymous
    13th Jun 2016
    12:42pm
    The family home IS ALREADY INCLUDED in the Age Pension. Have a look at the anomalies between homeowner and non-homeowner. The provision penalising those who save and strive has always been there! Are you Blind Freddie?
    LiveItUp
    13th Jun 2016
    12:47pm
    A $2 million one is not. Not much difference between home owners and non home owners. If you saved and strived why are you on the pension? Blind Freddie can see that.
    MICK
    13th Jun 2016
    5:22pm
    You might be missing Bronny's point Eddie. The government is going to levy at Death Duty on the family home. Whilst the LNP trolls on the site will deny deny deny the trigger will be when the money dries up. Then it's game on. You can bet your house on that one!
    LiveItUp
    13th Jun 2016
    7:04pm
    Only for those on welfare Mick.
    TREBOR
    13th Jun 2016
    7:32pm
    Nobody here in Australia is on 'welfare' - any recipients of Social Security are... on bought and paid for Social Security.

    Robbing the till and hiding it in 'consolidated revenue' - the graveyard of all great social ships of state - in no way removes the absolute responsibility of governments respective to Pay The Bill As They Fall Due!
    LiveItUp
    14th Jun 2016
    8:07am
    Way too many people on welfare in Australia and invludes family tax benefits. It us welfare because the government receive no economic benefit from it. No matter how hard you hsve worked or not you get same deal. Hardest and most productive workers get zilch as they are deemed able to look after themselves. All social security is welfare.
    TREBOR
    14th Jun 2016
    10:10pm
    NO Social Security is welfare - it is an absolute bought and paid for entitlement.

    Government has already gained economic advantage from garnering the revenue for it from taxation - do try to keep up in class.

    By what standard do you imagine government has any entitlement ™ to gaining some economic advantage from accepting taxation? Do you suffer the delusion that government is a business pure and simple and can only function on a profit basis? In that case every one of your purported rorts would long ago be sailing down the Bondi Outlet River... since NO government dedicated to 'profit' could afford to give away all the perks it does to its mates.
    Anonymous
    17th Jun 2016
    8:03am
    Fast Eddie is right. The family home IS already included in the pension system. What is seriously wrong is that it's included at the same value whether it's a $200,000 unit or shack or a $50 million mansion. It costs many retirees $15600 a year to own a home (based on differences in asset thresholds), plus rates and insurance and maintenance costs. Many could easily find themselves up for $25,000 a year to own a home ($480 a week), while renters are getting extra assistance on top of their pension. We hear a lot about how hard it is for non-homeowners, but it seems to me there's a lot of discrimination in the system against those who struggled for 5+ decades to pay off a modest home.
    mogo51
    13th Jun 2016
    10:34am
    living 'modestly' what does that actually mean? Living in a room in a guest house, share everything for $200 or 1 b/r flat small but ok $250, eat mince and sausages, nothing left over for any niceties, sit at home watch tv no money for a movie etc? Is this what is expected?
    I moved o/s to try and live a better standard of life, but all we get is flack from politicians who live in the ivory castle, rort the public purse and point fingers at us. I have a decent size 1 b/r apartment, can eat quite well (but again not lavishly), meet up with other Aussies twice a week for breakfast and a chat (cost $4 each time), can go to the movies or eat out at cheap restaurants a couple of times a week and feel human!
    I have a small Super fund that gives me a few thousand extra each year but with the falling Au$ it just offsets the losses from exchange rate.
    I am happy as I can be, would rather be living back in Oz but just can't afford it, nor do I want to seek handouts from soup kitchens etc.
    I would just like to stop being treated as if I was some sort of criminal!
    MICK
    13th Jun 2016
    12:12pm
    If you are surviving and happy then..........be happy. Plenty of third world people would give their right arm for what you have. Having said that, and without knowing your circumstances, you should have save more during your working life.
    Hope life is nevertheless good mogo.
    ex PS
    13th Jun 2016
    10:45am
    It proves one thing, the difference between living well and just surviving is whether you own your own house or are renting, Yet we have people advocating asset testing the family home in order to qualify for a pension.
    It makes no sense from an economical or fairness point of view. If you don't own your own home you get a rental subsidy if you do you get a reduction in pension, we are heading for a social clime where the average Australian just won't bother to buy a home. As is considered quite normal in Europe.
    Wonder what the government of the day will try to steal of us then?
    LiveItUp
    13th Jun 2016
    11:03am
    Houses cost money to run them so it makes no sense to own them yourself.
    MICK
    13th Jun 2016
    12:13pm
    Yes PS. Answer: the inheritance we leave our children!
    Anonymous
    13th Jun 2016
    12:31pm
    Houses are an appreciating asset. To invest in one today is better than tomorrow, but not as good as yesterday. To think otherwise is not to own one and display obvious envy.
    LiveItUp
    13th Jun 2016
    12:35pm
    I am not envy of anyone owning a house as I can do better things with the money myself.
    Anonymous
    13th Jun 2016
    12:44pm
    Of course you are! You are green with envy!
    LiveItUp
    13th Jun 2016
    12:50pm
    Certainly not when the owner of my estate runs the estate like a business and makes money instead of losing money every year like home owners. I know who is green with envy.
    Anonymous
    13th Jun 2016
    4:07pm
    You are talking just crap, again. Your eyes are brown, aren't they?
    MICK
    13th Jun 2016
    5:25pm
    You can't believe anything from Bronny. I maintain she is an ex LNP MP now working for the Party as ex Libs always do. I caught out a poster called Solomon a year ago and he said that he was paid a yearly retainer for "Services to the Liberal Party". Bronny is likely the same. And as you say.....full of (contradictory) crap.
    LiveItUp
    13th Jun 2016
    7:30pm
    Gee that's a big claim for someone who has never even been to the new Paroiaament house. I'll keep any eye out for those payments but I feel that they will be a long time coming if at all.

    Will you wrote a letter for mr Mick to remind them about those payments?
    LiveItUp
    13th Jun 2016
    10:53am
    What should be of a bigger concern is the increase in the number of people in Australia today borrowing money on their credit cards. I'm not talking about credit card purchases but using credit cards to get cash out of ATMs. That is just one step above payday loans. How are these people getting these credt cards? Seems that it may not be responsible lending to me.
    JJ
    13th Jun 2016
    11:56am
    The ready availability of credit in large amounts is one of the major reasons for the problems many face today. It discourages the mindset which is so necessary in order to keep afloat financially - and that is to live within one's means. We can thank the privatization of banks for most of that! They enthusiastically urge us to borrow big, so that we can have the luxuries we cannot afford and may never have the capacity to ever pay for. I brought my children up to live by the rule of living within their means, but unfortunately not all of them married partners who agreed with this ruling.
    LiveItUp
    13th Jun 2016
    12:15pm
    Some of those partnets really need educating. We had one that we nearly had to starve before they got it. Now they can't believe how stupid they were and how much more they enjoy life knowing that dusasters are now minor inconveniences.
    Alex
    13th Jun 2016
    12:56pm
    Hi Mick, 30 year loans can easily be extended or renegotiated and often are. People may remortgage their homes or get extensions on their mortgages to pay for children's education, repairs and maintenance and other necessities.
    People may buy a home unit to start with and upgrade later to a family home. The huge increase in interest rates in the late 1980s 1990s meant that many people paid interest only for a lengthy period for time and could not touch the capital.
    MICK
    13th Jun 2016
    5:27pm
    I agree....but the argument in the article is about people buying a house and retiring without having paid it off. The reason I put this up is that people can elect to pursue folly but if they end up in trouble it is a problem of their own making.
    FM
    13th Jun 2016
    6:00pm
    Thanks Mick. I am sure people who bought houses hoped to have them paid off at retirement but that did not work out for many people who had to cut back on repayments not to fund luxuries but to cover bare essentials when interest rates rose unforeseeably and astronomically in the 80 and 90s. They had no other option. People who had already paid off their homes may have got by, but many people with children even those on very good incomes struggled at that time especially if they were in expensive cities and had to make high after tax contributions to compulsory superannuation. The financial crisis was not of their making. People looked at using some of their Lump sum if they had one on retirement to get rid of the debt but many have found that after many years of doing the bare minimum their homes need quite a bit of repairs and maintenance which is expensive. Current low interest rates makes debt more affordable and gives people a chance to catch up. Eventually people with debt they cannot service will be forced to sell. Many try to hang on to the family home a bit longer before moving to a retirement village or aged care.
    Alex
    13th Jun 2016
    1:07pm
    I have been searching hard for a country to suit Bonny where there are low wages for a significant portion of the population who can be exploited by the wealthy and who can therefore save little for retirement and where there are no aged pensions or assets are taken in lieu of a pension. Alas so far I have not found one. While North and South Korea, India and Outer Mongolia may have low wages they have a universal aged pension. India’s universal aged pension set up by Indira Ghandi around the same time as Ben Chifley set up ours. They have maintained theirs so that everyone gets and aged pension while our money was taken by previous Governments and Treasury. I thought perhaps South Sudan which has had some recent strife might not have an aged pension but South Sudan Law provides for both full and early pensions. For a full pension, a worker must have attained 60 years of age with at least 240 months (20 years) of contributions. An Early pension is available to the workers who have attained the age of 50 years with 240 months (20 years) of contributions. The minimum total pension is 40% of average monthly earning in the last three years before retirement s while the maximum total pension is 80% of average monthly earnings. The total pension is reduced by 15% if the worker is aged 50-54 years. The pension is reduced by 10% for workers aged 55-59 years. The old age pension entitlement conditions may be relaxed for the persons involved in hard labour or who practice such occupations which require early retirement.
    I am still looking hard for a country for Bonny that will operate on her dogma of how others should be treated can anyone help? Perhaps in the end Australia will be the only country where a significant portion of people are paid low wages, not adequate to make substantial savings for years of retirement and will have their homes and assets confiscated if they are to get any financial support in old age and ultimately become destitute in old age. Perhaps sadly we are not so far from Bonny’s ideal state.
    LiveItUp
    13th Jun 2016
    1:43pm
    You can stop looking as I am very happy on my country estate with my toyboy and housekeeper.
    Aussie
    13th Jun 2016
    4:02pm
    Hey Bonnie I am looking for a sugar lady .... can we have coffee sometime ??? please :-) :-) ... I live on a house with water views but I have a hard time with finances so I will love to share my 8 rooms home with large water views balconies ..... with you ... please let me know if this may be suitable for you :-) :-)
    Anonymous
    13th Jun 2016
    4:20pm
    Saccharine
    Rae
    13th Jun 2016
    5:15pm
    There are adds in every Land newspaper for caretakers of country estates. A bit of usefulness with machinery, or a working dog or two will get you at least an interview.

    There are also very cheap rentals if you ask around in rural areas.

    Having a pile of grandkids might help as the schools are always looking for new enrolments.

    I have a certificate of farm management from Tocal and 18 years farm ownership and could get a caretaker position next week if I wanted.

    Get a few skills and some experience and go for it.

    We should never have fallen into Keatings superannuation trap. We need to work out how to get out of it. It only effects wage and salary earners so that might be an out. Everyone self employed on contract but then that was very scary to a lot of people too.
    MICK
    13th Jun 2016
    5:30pm
    Alex: Bronny needs to be in a Nicaraguan jail doing time for crimes against her country methinks. That would just reinforce what I already know: there is a God.
    LiveItUp
    13th Jun 2016
    6:16pm
    I grow my own coffee so you must be game to want to try it.

    Sorry it would be easier to get a job than one of those caretaker roles around here. One of the best schools in the area is close by but you need to put your childs name on waiting list when they are born to get a place.

    I do agree about Keatings super though. Unless you have SMSF you get the scraps left after everyone one else had had their share.
    Anonymous
    15th Jun 2016
    10:34am
    Keep looking, Alex. And also look for a way to have this nasty narcissist evicted from Australia. It's people like Bonny who are destroying what was once a great nation.
    Anonymous
    15th Jun 2016
    10:34am
    Keep looking, Alex. And also look for a way to have this nasty narcissist evicted from Australia. It's people like Bonny who are destroying what was once a great nation.
    TREBOR
    13th Jun 2016
    1:08pm
    Personal anecdote time:- We're lucky - the ex for whom I am carer and I - in order to establish her in a user-friendly home, we are only running a retirement debt of $77k, including the vehicle she can sit in.

    Should've spent me life as a politician....
    TREBOR
    13th Jun 2016
    1:11pm
    In order to resolve this issue I plan to simultaneously apply for work while campaigning for a better deal for the Pensioner Retiree in terms of how such additional income is treated, i.e. no loss to Pension, and treated for tax on income same as everyone else (opens the doomsday door to the fat superannuant demographic)....

    Pay 'em all the Pension and tax income above that the same for everyone.. that'll slow down the hungry bastards out there a bit.
    FM
    13th Jun 2016
    3:07pm
    I agree Trebor. Good luck.
    Rae
    13th Jun 2016
    5:17pm
    Couldn't agree more Trebor. Good luck.
    MICK
    13th Jun 2016
    5:32pm
    It's tough. Some people slip through the cracks with bureaucrats having little compassion..
    Not Senile Yet!
    13th Jun 2016
    1:33pm
    So many on here have been Sacked in by Liberal Propaganda......not that Labor are any better!
    Only 10% are RORTERS....be they Pensioners...unemployed....or disabled!
    90% are dealing with genuine hardships!
    The conn is that they have Sold you the Lie that the 10% are the Majority!
    Getting all fired up by Labels and Name Calling is their deliberate ......Divide & Conquer Strategy.....and the masses Fall for it!
    500 people applying for 100 jobs....means 400 are trying.....not budgeting! 10% of 400 equals 40! But somehow you all believe that 360 were not genuine.....but the reality is that it is more likely 40!
    Of that 40....approx 10 are not employable....for whatever reason.....another 10 have given up....and the Bludgers the other 20!
    Stop being conned by the Parties Negative Propaganda!
    Unions are not Corrupt.....it is people within them that are.....And that applies to Every Profession.....even Political Parties and their Party Puppets!
    Grow a Brain and STOP Voting for the Party Puppets.....who by being human......are also Corrupt!
    Vote the Parties OUT!
    Stop giving them the Power ......Vote Independant!
    LiveItUp
    13th Jun 2016
    1:58pm
    But there are no dependants on the ballot paper for my area. There is a good chance my seat will go green too. So I will then be a green seat for both state and federal government. Good or bad I really can't decide.
    MICK
    13th Jun 2016
    5:35pm
    NOt as many as you might think Not Senile. Some posters here are not legit. It's wrong that there is no ANTI PROPAGANDA LEGISLATION to prevent either side of politics from running dishonest and malicious campaigns against the other side.
    Maybe in the next parliament. I'll be taking up the issue along with the media involvement trying to distort the political landscape by running blatant one sided propaganda and hate campaigns.
    MICK
    13th Jun 2016
    5:36pm
    Well there it is Bronny. You live on the moon! Hope your helicopter gets you back to vote.
    LiveItUp
    13th Jun 2016
    7:14pm
    Now that would take some explaining Mick. We went sailing once and didn't get back in time to vote.
    FM
    13th Jun 2016
    2:19pm
    I have noticed that the senior's petition
    https://www.change.org/p/jenny-macklin-it-s-time-to-protect-our-pensions-5ba876d6-be9d-44c2-8ca1-4fb4cc79b7b7?recruiter=550430732&utm_source=share_for_starters&utm_medium=copyLink
    needs more signatures to get to 100. It may be circulated by Change.org when it reaches that but it is all happening slowly and it would be better if it could reach politicians well before the election. If people on this website have friends or family who are interested in social issues perhaps you could circulate it so that it does not seem that nobody cares about having a decent retirement system in Australia and perhaps they could forward it to their friends.
    Anonymous
    15th Jun 2016
    10:46am
    Thanks FM. Signed and circulated.
    Hairy
    13th Jun 2016
    2:29pm
    God forbid you have a divorce.you know when your left with half if your lucky.and I'm sure there's plenty it happens to.just remember the next divorce is cheaper half of a half is a quarter.so you can plan all you like circumstances beyond your control can put you in the street.but do judges centreclink X wife's give a dam.spare a kind thought for those poor fools who are in the crap for just being normal humans.thats life.
    TREBOR
    13th Jun 2016
    7:40pm
    Been through all those, Hairy... (personal anecdote time again)... and went from $100k pa in 1992 (at that year's dollar rate, mind you) to homeless, sick, injured and totally unwanted in what should have been my years of solidification into retirement.

    NOBODY gives one damn about you or what you are going through, and many pile on you as if you are some worthless sack of shot who's drugged and boozed it all his life instead of putting in 100+ hour weeks.

    No wonder there is a day of reckoning coming here.....
    mogo51
    13th Jun 2016
    2:35pm
    Mick, rather quick to judge me without any evidence to back yourself. Ever heard of a late life divorce? Many of us go through it and find themselves in my position.
    Was going along ok before that!
    My point was we should be allowed to live where we want without judgement once we have reached retirement age. I worked 45 years in Oz, divorce and a couple of other bad luck incidents left me behind where I had planned to be.
    It is called 'life'
    FM
    13th Jun 2016
    3:10pm
    I am amazed at how judgemental some people on this site can be. It used to be 'once to die and after that the judgement'! Now it seems to be 'to retire and after that the judgement'. People who have had reasonable lives seem unable to understand that many workers are paid low wages that barely meet their weekly necessities and do not allow them to save much for retirement; that people in good jobs have been made redundant mid career and have not been able to find similar employment; that businesses have gone bankrupt during downturns and taken people's saving with them; that people have become ill or that adverse family circumstances or retirement investment schemes have taken savings. There seems be a holier than thou attitude that presumes that good fortune in the lottery of life is down to one's own personal virtue and no understanding of the fact that many people start out handicapped by lack of education, support and ability among other things and that all kinds of things can go wrong along the way.
    Anonymous
    17th Jun 2016
    7:55am
    You are so right, FM. This site is full of ''holier than though'' arrogant JUDGES who have never experienced real hardship and haven't an ounce of compassion for those who did.

    I have done quite well, in spite of a very underprivileged childhood and unbelievable challenges. I will retire, eventually, struggling but self-funded. But the hardship has taught me never to judge or condemn others, but just to be grateful for the strength, resilience, and very occasional blessings that have enabled me to jump the hurdles.

    ''There but for the grace of God go I''.

    Decent human beings look at those who are struggling and say a silent prayer of thanks that they have been more fortunate, then look for ways to help. They DO NOT condemn. Maybe you are more fortunate because you are smarter, more capable, stronger, more determined... all of those attributes are blessings that luck has bestowed on you. You may deserve some credit for hard work, persistence, and being frugal, but you deserve NO CREDIT AT ALL if you cannot have the empathy and decency to realise that LUCK is the most significant factor of all in success. Even if all luck gave you was strength and intelligence, you are LUCKY to be able to do what you have done, and those who couldn't deserve respect - not your vile sneers and insults.

    13th Jun 2016
    2:39pm
    The reason a lot of people who are still carrying debt at retirement age is the way banks and other lenders have allowed a redraw of a mortgage. Whilst the idea may sound good it means that the purchase of a car will be spread over the remaining term of the loan. Assuming a change of car each 3 years, a borrower could be actually paying the balance of a loan for 7 cars.

    Before the redraw system was allowed, a home loan was over a fixed period and the loan was repaid within that period. Any loans for non real estate items, cars, caravans, holidays, furniture etc were granted as a personal loan usually with a maximum of 5 years. Additionally, loans were granted only if an ability to repay was there so borrowers tended not to overspend. If a home loan is not repaid but redraw is allowed, the interest rate is not reducible and the cost of interest over the period is excessive.

    The above is one reason but another more sensible reason is to upgrade a home until a very large, expensive home with a comparatively small mortgage is owned. This is sensible because it gives people the only way to invest in housing which is tax free. The expensive, large home can be downgraded to a more sensible home with the profits being free of capital gains tax. The profit can be invested to give an income during retirement.
    Rae
    13th Jun 2016
    5:34pm
    Everything you have said here old man is the reason people retire with large debts. They have made themselves slaves to the banks for no sensible reason. Paid oodles of bank interest to save a little bit of tax.

    You assume a new car every three years. That is very wasteful.
    Only my first car was bought using finance and it was second hand.

    I now have a car account and pay into it fortnightly to pay cash for the next car. Hopefully the car will last around 12 years. I look after it well and 12 years is a decent run.By then I have cash ready for the next one.

    Why pay the bank interest to save a piddling amount of tax. Better to make money and pay tax. Not by buying a liability, which is what a house is. Unless you buy a positively geared investment and collect the rent and pay tax like people making money do.

    Anyone wanting to use this strategy please sell up soon before the bottom falls out of the housing bubble.

    Sorry old man but this is entirely the sort of thinking that keeps people asset rich and cash poor as church mice.

    They end up with a big house, new car, lots of toys and no money to upkeep or insure it all.Still up to the neck in debt. No money to enjoy life.
    LiveItUp
    14th Jun 2016
    8:23am
    Present pension system rewards those who trade up their housing when it is better in many other ways to trade down. People are then asset rich and cash poor when they should be spending their wealth on their bucket list. Seems very stupid to me.
    Kaye Fallick
    13th Jun 2016
    3:13pm
    Hi Mojobomber and Qld Diva - apologies but thanks for telling us re faulty link - now working warmest, Kaye
    TREBOR
    13th Jun 2016
    7:43pm
    Forgiven - (says that old chauvinist) - a lady as lovely as your good self could not possibly be held to fault.......
    Anonymous
    13th Jun 2016
    9:29pm
    Crawler.
    Sundays
    13th Jun 2016
    5:03pm
    The article represents a lot of baby boomers I know. Have always lived well, redrawn on the mortgage to fund expensive furniture, holidays etc. Now facing retirement and they suddenly realise that the pension is not going to be eneough. They used to say to me, we don't know what you do with your money. Very boring, but we paid off the mortgage, and saved extra for a comfortable retirement.
    Rae
    13th Jun 2016
    5:42pm
    In my experience of working with hundreds of people Sundays I noticed very few are able to see consequences or show foresight at all. It is only when it happens that they realise that actions have results.

    They will say I just can't see it. And they can't.

    That is why we need strong and moral leadership teams in government and experienced public servants with some of them able to foresee future consequences and take effective actions.

    What we don't need is the current shortsighted actions for short term gains regardless of consequences.
    LiveItUp
    13th Jun 2016
    7:17pm
    Too many people buy stuff to impress others they don't like anyway. Never saw any sense in that myself.
    Anonymous
    15th Jun 2016
    10:05am
    The people I know who forward planned and saved for retirement are those who grew up poor and did it really tough early in adult life. The experience of having to fight for survival teaches you a valuable lesson. But the sad thing is that those folk are now suffering big time for their responsible planning and saving, while those who didn't bother get handouts. This government has totally destroyed the incentive to save - not that it was strong to start with, but they've wiped it out completely for anyone who hasn't managed to accrue very significant wealth. That middle bracket of battlers who saved are being very unfairly targeted for income losses that no other citizen suffers. And that's AFTER having their incomes slashed by deteriorating economic conditions.
    Jilly B
    22nd Jun 2016
    9:41am
    `Hi Sundays, My brother and his wife did exactly what you have done but now with Interest rates so low and little or no pension and a house that they have owned for years they are NOT enjoying life. Singles will have a very hard time existing on an aged pension if they do not own a home. Paying rent and all the necessary insurances keeps everyone poor. You can always choose NOT to pay the Insurance on some items but then again if you have no savings and something happens you are on your own. For female or males for that matter if all they have in superannuation accounts are compulsory amounts since 1991 and they are retiring or retired that is not a lot of money. There are a million reasons why people find themselves in this situation. A low level public servants wages do not even let you pay off your house and educate your children let alone insure for the mountains of things that you would like to be covered for these days or contribute to extra superannuation. Everything keeps going up except wages. My Health Insurance went up AD7.00 fortnightly but the pension went up AD6 so that is real progress? Sad
    FM
    13th Jun 2016
    6:10pm
    I fully agree Rae.
    As they say you can't put an old head on young shoulders. Younger people are struggling with the big issues and challenges of their time of life. Many do not have the resources or skills to do much forward planning. With regard to retirement there needs to be a properly planned social system in place that will enable all people to achieve reasonable security in retirement.
    Rae
    13th Jun 2016
    7:36pm
    I totally agree FM.

    It is so unfortunate that we are one of the only countries not to pay a universal aged pension.

    It skews investment behaviour from the very start as people are fearful of not having enough money in retirement.

    Countries that have no retirement welfare usually suffer from the consequences of it in the longer term.

    The idea of paying everyone a pension and taxing other income sounds fine.

    I've never minded taxes. It means I'm making good money.
    Needy not Greedy
    13th Jun 2016
    7:22pm
    I think your right Mick, Bronny is an LNP infiltrator, but I do have a soft spot for her as she doesn't have a home (maybe) Whereas I am one of the lucky ones that managed to just get my place paid off by working til 68yo, I have a small amount of land with the house and run two sheep, two alpacas and a duck, the duck lives alone in a barn and is looking for a partner, the bugger is one of those evil Labor voters but he told me he would still like to meet Bronny with a view to her moving in with him,I would love to see him with a partner but the duck is a bit of an intellectual and I don't know if Bronny could carry a conversation with him.
    MICK
    13th Jun 2016
    8:28pm
    Ha, ha, ha. Funny.
    LiveItUp
    14th Jun 2016
    8:01am
    Mmmmm I thinking duck dinner and a nice feather down pillow.
    Needy not Greedy
    14th Jun 2016
    12:46pm
    Good one Bronny, but he's just a plain old duck, Turnbull has the Golden Goose and he is slowly choking it to death, an upset election result won't save the Goose because Shorten will have his hands on its throat quick smart, the only hope poor old Goosey has is that enough Independants get in to prise the fingers apart, but sad as it is, that is a forlorn hope.
    LiveItUp
    14th Jun 2016
    2:42pm
    If enough Greens get in they will feed him to all the asylum seekers they want to bring in so the poor old duck doesn't stand a chance.
    LiveItUp
    14th Jun 2016
    2:43pm
    I don't think that Golden Goose is going to lay golden eggs for anyone for a very long time.
    ayers
    18th Jun 2016
    10:11pm
    From the article, who calculated the figures given in the article:
    "
    According to the Association of Superannuation Funds of Australia (ASFA), single retirees will need $23,651 per year to live a modest’ lifestyle, with couples requiring $34,064 to do the same.
    "
    This is not correct, and it contains deception. "Modest" lifestyle” is a tricky word to be used here, instead it should be "just right over the poverty line" expression. In order to keep the pensioners to have relevant comfortable and free of fear economic difficulties, those given figures should be increased min 50 %. So, the singles need 32 000 $/yr minimum, and couples pensioners combined needs, 50 000/year minimum.

    For one pensioner and the other partner who does not earn money, still the same amount $50000/year. The current situation is ridiculous as for one partner rate, reduced to amount around 595 $ fortnightly (less than single's rate), or 15470 $/yr only pensioner income for a couple, unfortunately. There is no pensioner spouse allowance to the other partner born over 01 July 1955, so nothing to support! If the non-pensioner has the job by luck and enough income, the age pensioner does not pass the income test, and state gives nil age pensioner money. So one partner becomes automatically beggar to the other partner.

    I expect ALP focuses on this odd situation (Coalition and or liberals by nature, they keep blind eye on the such rights. If I am not right, why they have not resolved so far this basic issue since 2013!) and restore the old rules which had been applied till 2008, when the Gillard Govt. abolished the pensioner's supplements by acting upon overseas outside money patrons directions. Everybody knows. So the present ALP Leaders must have BALLS to resist such kind of orders, bounce back such inhumane orders to their mouths.
    Mindy
    20th Jun 2016
    6:49am
    Yep,
    more Govt handouts - That'll fix it.
    PIXAPD
    23rd Sep 2016
    11:32am
    You have got to be joking? retiring or retired and in debt? you have got to be joking.

    29th Sep 2016
    5:39pm
    This is why retirement planning is a must. For those who are not yet retired...heed the warning...plan for your retirement..pay off your home, car etc.

    Most people take not notice.
    KB
    26th Jul 2019
    11:46am
    There are many factors as to why people are still paying off their mortgage. People do get retrenched and unable to find work .People like my daughter will be starting later as she needs to save for a deposit which takes longer even just for a small apartment or unit .I am debt free I do not take out loans to buy new items such as fridges. Never take out a loan with Centrelink as you are left with very little to live on. Use a budget planner and work out your incoming and outgoing expenses..Cut back on things you do not need and put the money towards whatever you need to pay off urgently. People must lean to live within their means
    KB
    26th Jul 2019
    11:46am
    There are many factors as to why people are still paying off their mortgage. People do get retrenched and unable to find work .People like my daughter will be starting later as she needs to save for a deposit which takes longer even just for a small apartment or unit .I am debt free I do not take out loans to buy new items such as fridges. Never take out a loan with Centrelink as you are left with very little to live on. Use a budget planner and work out your incoming and outgoing expenses..Cut back on things you do not need and put the money towards whatever you need to pay off urgently. People must lean to live within their means


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