Do retirees have an income problem?

Is the Age Pension adequate or are those advocates living on a different planet?

Do retirees have an income problem?

For older Australians, information and advice about the financial aspects of retirement has never been more available – which, for some, makes the ‘correct’ path ever more confusing.

How much do we need for a ‘comfortable’ retirement? Are we being asked to save too much? Does the Age Pension allow for a dignified retirement? For home owners and renters?

A recent panel discussion at the Grattan Institute looked at how current generations are faring in retirement, and what kind of life in retirement we can expect. Panellists discussed the policy levers such as the Super Guarantee, superannuation draw-down rules, retirement age, the Age Pension and means testing.

Grattan Institute editor and moderator Paul Austin sought the views of:

  • John Daley, chief executive of the Grattan Institute since it was founded eight years ago
  • Peter Davidson, senior adviser with the Australian Council of Social Service, specialising in employment, social security, superannuation and tax policies, income distribution and poverty
  • Kaye Fallick, publisher of retirement website YourLifeChoices, writer and commentator on all matters retirement and retirement income.

Their views and robust debate can be heard below:

Is it too big a challenge to rent on an Age Pension? Is rent assistance out of touch with reality?

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    COMMENTS

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    tisme
    7th Jun 2018
    10:07am
    im not on the age pension yet but on the carer pittance its hard to rent , I have about 200.00 per fortnight left after rent, then I have all the other expenses I do have a daughter on disability but that doesn't go far either if you add medical and disability expenses.
    jackie
    7th Jun 2018
    10:59am
    Tisme...Sadly, ALL low income renters are suffering in an inflated property market. Thanks to Governments and overseas investment that won't be stopped because GREED has turned homes into commodities.
    Linda
    7th Jun 2018
    11:51am
    I agree jackie. Someone I know is trying to purchase a home to live in, adequate savings are there, home loan approvals in place, and yet the competition for them is the older folks selling out of their large homes and bidding for the smaller homes. The oldies are cashed up and ready, and are outbidding the young folks starting out.

    This kind of management of the economy illustrates what poor economic managers our current government is.

    If one can get a rental they can afford, it will most likely be over priced and in poor condition. This is a blight on our society and creates a lot of harm. It should be a number one priority of all levels of government.
    Anonymous
    7th Jun 2018
    2:58pm
    Rental assistance is available of your rent is over $150 a week you get around $68 (single) and $181 plus $65 for couple
    I suggest moving to a town or suburb where you cant rent for about $200 single or $250 couple
    Not hard to find a 1 or 2 bedroom place for that amount .
    MICK
    7th Jun 2018
    10:42am
    Retirees in many cases do have an income problem. The old farming problem of asset rich and income poor.
    The current government is intent on retirees selling all their assets, including the family home, and living off the proceeds. Whilst I see the point the family home should NEVER be used as food money. Morally wrong. And why should parents not leave their children a small leg up in life? Only the aggrieved and would consider that as being unsuitable.
    Perhaps the biggest issue for self funded retirees is that some who barely earn the equivalent of a pension on their investments are being tarred as rorters by the current bad bad government. I fully do not understand how this crop of MPs does not comprehend that retirees getting zero assistance from the state are a liability. Perhaps they would rather this group spent it all and then joined the pension queue. That'd do wonders for our already high national debt.
    Linda
    7th Jun 2018
    11:55am
    I think our retirement savings are seen as giant honey pots to be raided. Those with a lot of money can exercise various tax avoidance, those with a reasonable savings may not be in a position to do that.

    When the trust in the advisers goes down as it has, then we can't feel safe to even get good advice.

    Things are very bad, and complicated. I think it is wrong and incorrect to say Liberals are better at managing the economy.
    Anonymous
    7th Jun 2018
    12:01pm
    Self funded retirees are being treated as rorters by Labor
    Shorten wants to take franking credits away from them ,
    He will hurt the middle class the hardest
    Bad policy by a clueless party
    MICK
    7th Jun 2018
    1:30pm
    Liberals are absolutely poor managers of the country's money Linda. Their strong points are sacking workers and giving money to the rich. The current government is the worst in living history and clearly has no fear of being turfed out because it has media propaganda saturation at election time and they know Labor will find it difficult to dispel the lies told to the public.
    I have hope that voters will one day get it. Maybe when they are out in the streets and begging for a bowl of rice.
    GeorgeM
    7th Jun 2018
    12:19pm
    Sickening, the amount of publicity we get for the views expressed at this Right-wing Lobby Group, Grattan Institute. Many may want to vomit on hearing the usual spiel from this right-wing group with NO touch of reality. I am sure Kaye must have had a hard time listening to the rubbish from John Daley. This forum is clearly one to throw ideas out there (to see reactions) to hit retirees with more nasty policies including attacking people in owner-homes who sacrificed very large amounts on mortgages and expenses of owning a home - unlike renters, and who deserve better. The basic Pension is the real issue, not how to help this group or that.

    These forums are encouraged, even by YLC, to pit one group against each other (having an ACOSS member on the panel doesn't help), and THAT NEEDS TO STOP! People who SAVED were severely attacked by the Liberal Govt through insane Asset Test changes in 2017, and that needs to be reversed / negated to have FAIRNESS for all.

    We note the other day that we are 2nd lowest on the list of OECD countries for assistance to Pensioners! It's a direct indictment of the UTTER FAILURE by BOTH major political parties to treat the Age Pensioners decently in this highly Resource-rich country with a small population.

    Universal Pension for ALL with NO Tests, based only on Age (65 yrs) and Residence (say 15 yrs) is the ONLY FAIR SOLUTION. Ask your MPs to push for it. Also, remind them we will be getting rid of them if they don't help. Politicians Special Pensions also need to be scrapped to make them equal to other humans!
    MICK
    7th Jun 2018
    1:32pm
    The problem we have in our so called democracy George is that the rich own the media and the media can convince the mentally challenged amongst us that black is white. That is how bad bad governments get back in.
    GeorgeM
    7th Jun 2018
    8:11pm
    Wonder how many listened to the audio in the article above? I did try, but John Daley's comments were too nauseating to continue listening to the end.

    While Kaye did let him know most YLC Members (around 250,000 they said) would consider John Daley to live on another planet (given his nonsensical spiel that all was OK with pensioners), I am rather disappointed that Kaye agreed with John that a majority of YLC members agree that the home could be part of an assets test (subject to a high value such as $3Mil). I can't believe that's true (given the large number of comments against it), and I believe serious damage has been done if the right-wingers such as Grattan now consider that an acceptable policy change for retirees to recommend to their Liberal party bosses (maybe even Labor who may latch on to such sick policy attacks on retirees in future). Once such a policy gets implemented (say even by Labor), the next Liberal Govt after that will cut that $3Mil down to say $1Mil, and so on Just like they did for the Assets Test - Keating introduced it, and Liberals screwed it up further - the disgusting Tag Team who have now been attacking pensioners for decades.

    So, my advice to all - VOTE OUT both Liberal and Labor seat-warmers (and Greens), and get in anyone else including Independents - to save the country from these disgusting 2 Major Parties. Put them last in preferences.
    HarrysOpinion
    7th Jun 2018
    2:06pm
    Is it too big a challenge to rent on an Age Pension?
    -Not, if you move to regional cities or a large country town.
    Aussie
    7th Jun 2018
    2:33pm
    Yes I agree HS but the only places to afford rent or buy a home for around or less than 200K is very deep in land in Queensland ... I found some places that sell for about 200K and others that rent for about 100 x week .... so yes I agreed but there are many considerations to take care for instant Health .... How far is the closer hospital or medical centre ..... can I still drive long distances ????? ..... maybe I need to live and share with someone else to help each other ?????? not sure but as simple as you indicated ....."-Not, if you ...." well that is statement without considering all the consequences of moving to a remote place ..... maybe much better to move overseas cities and live a better life ....... sorry if I disappointing you
    Aussie
    7th Jun 2018
    2:36pm
    Some samples here ....

    https://www.realestate.com.au/news/queensland-has-the-cheapest-rental-houses-and-untis-in-australia/

    Or maybe buy a Church in Adelaide ?????

    https://www.realestate.com.au/news/a-decommissioned-church-on-the-eyre-peninsula-is-going-for-a-50k-steal/
    Aussie
    7th Jun 2018
    2:49pm
    And this is for OG the perfect place for his retirement he he he he

    https://www.domain.com.au/49-buena-vista-avenue-coorparoo-qld-4151-12231814

    Rich pensioners can afford this ..... no worries he he he he
    Old Geezer
    7th Jun 2018
    3:08pm
    Already live in something just a little better than that and it's not in a city but in a nice peaceful rural setting instead.
    GeorgeM
    7th Jun 2018
    7:56pm
    Agree, HS, by definition renters chose to live in temporary accommodation and are used to moving to wherever they can afford it. They may have invested their money rather than pay a mortgage or other house expenses. It is NOT JUST the Rent Assistance they can use to pay rent (it is a supplement) but also part of their pensions just like homeowners who have to bear all expenses of owning and running their homes without any supplements.

    Targeted assistance always ends up being criticised as either not enough or (rarely) too much. Best solution is the Universal Pension for all, and you are free to do better than that if you can.
    HarrysOpinion
    7th Jun 2018
    8:12pm
    Aussie, you nearly got "bingo" Now run your search on https://www.realestate.com.au
    1) Homes under $200,000 Australia wide
    2) Home Units 2 bdrm and 1 bdrm under $200,000

    Do a similar search for rental up to say, 2 bdrm unit under $180 per week and you will discover that there are many opportunities all round Australia's major regional cities and country towns. Not necessarily deep inland QLD.

    Each major regional city has an airport, railway connection, strong health care system and strong commerce system.

    If one can afford to stay in capital state city then stay, waste your money. I don't care. But, let no one whinge that you can't afford to downsize or to afford to rent in regional cities.

    I have suggested many times before. If you want an affordable retirement life on a full age pension then move to a regional city of your choice. If your family really cared about you then they will understand why you have to move away and they would be happy to visit you from time to time where ever you live but if they don't care about you then it's probably a blessing in disguise.
    GrayComputing
    7th Jun 2018
    2:24pm
    It is time for all of us to rant at our MPs and Senators to take action for human decency and a huge stress reduction for pensioners

    NO ASSET TEST FOR A PENSION EVER AGAIN!
    A pension is not welfare.

    Most economist say we will save taxpayers money by dropping asset testing because of the massive overheads cost in running Centrelink and the 10,000 conflicting rules.

    Hiring more Centrelink staff will only increase taxpayer’s costs for processing the creeping insane red tape monster system politicians and well paid bureaucrats have created.

    Help scrap it now. Become a hero.

    Even poorer New Zealand has a NO ASSET pension so it is cheaper and user friendly.

    Why worry that few million$ earners get it too. That is peanuts to them, not enough for a good vintage champagne.

    Do retired and retiring people really look forward and want 100++ visits to/from Centrelink and be part of 3 million waiting queues and lost calls?

    Does your MP really like being part of the system that allows this indirect abuse of the elderly?

    This abuse is actually sponsored by our government and forced down to Centrelink and borders on a criminal act.

    Why do MPs normally compassionate persons let this Centrelink abuse happen at taxpayers’ expense?

    Some opposition and independent MPs stand to lose their chance at being part of the needed government changes

    We need to tell our MP and senators that these criminal asset tests for a pension must be dropped now.

    NO ASSET TEST FOR A PENSION EVER AGAIN!
    Aussie
    7th Jun 2018
    2:42pm
    Sorry mate we have to many rich pensioners here just read OG and many others than are against any changes to pensions ....and they call it a welfare .... so your chances are minimum ....but what you are saying is good if we manage to set up a global petition and been electronically sign by all the members here maybe we get somewhere ...... but your ideas are good mate ,,,,
    MICK
    7th Jun 2018
    3:02pm
    The whole issue is a political football with the current government. It's wish is simple: destitute retirees because this is where a fair bit of money sits. The problem is those in this cohort who have money are not about to throw it away and they WILL FIND A WAY. The rich always do. So this government then comes after those it can destitute: average citizens.
    The system is flawed and no politician has the backbone to fix it. If there was bipartisan support this could happen but the toxic government in power now has a hatred of Labor and cares nil for average Australians or the nation. So it governs in a vacuum and gives its wealthy supporters what they demand: money, money and more money. Bugger everybody else!
    GeorgeM
    7th Jun 2018
    7:59pm
    Fully agree, GrayComputing, the more who follow your advice and write to their MPs (and vote against them if the don't listen) the better. MUST NOT let them forget this major issue!
    Anonymous
    11th Jun 2018
    5:32pm
    It's about CONTROL. They can control people when the people are dependant on the government for their basic existence. They know they can never take it off the rich, so the rest of us are fair game. If they can reduce huge numbers to hardship, they can manipulate to do as they please and we'll have no power to fight back.
    HarrysOpinion
    11th Jun 2018
    7:29pm
    When the time comes, OGR, the common people always win in the end and the elitists perish but, the vicious circle, of those who rise from commoners to power greedy elitists, will always continue. It's a never ending evolutionary tragedy, whether it's under communism, dictatorship, democracy, monarchy or the hegemony of dominant social and religious groups. It's like incurable cancer.
    Old Geezer
    7th Jun 2018
    3:05pm
    Most people have an income problem. No matter how much they have it is never enough.
    Lou Lou
    7th Jun 2018
    3:17pm
    The joke with rent allowance is it’s based on one factor only if you pay over $150 you get an allowance.
    As the average rent in Australia has risen to round
    $350 to $400 a week how do you pay that on a age pension. The allowance should be based on what you pay
    I pay at present $400 a week and live on just an aged pension work out how much I have to live on
    Anonymous
    7th Jun 2018
    3:25pm
    Plenty of towns and suburbs where you cant rent for $250 a week
    And you dont have to pay rates, insurance and maintenance

    Problem is mots of pensioners are reluctant to move
    AutumnOz
    7th Jun 2018
    6:38pm
    Raphael, it is not so much that pensioners are reluctant to move house but that they are physically unable to move far away from hospitals and doctors as they can no longer travel long distances for appointments with them.
    It is pointless moving if it worsen their life style.
    Old Geezer
    8th Jun 2018
    11:18am
    Why do they need doctors and hospitals? Poor lifestyle and not enough exercise causes this.
    jaycee1
    8th Jun 2018
    2:15pm
    Actually no, OG - poor lifestyle and lack of exercise does not always cause the necessity off being near a hospital.
    Sometimes it can be because of accidents or even that they were born with the problem to start with.
    Stop lumping everyone in the same baskets - which is what you seem to do.
    Anonymous
    11th Jun 2018
    5:30pm
    Those I know who need extensive medical care it's either because they were abused in institutions as children, or because they were injured in work accidents or unhealthy working conditions for which they never got compensation for various reasons - generally because they couldn't afford the legal costs to pursue claims or, very often, because the employer closed up shop and declared bankruptcy - AFTER transferring all his wealth to a Trust or family members.

    OG is heartless and inhuman, jaycee1. Hasn't an ounce of decency in him.
    patti
    7th Jun 2018
    3:17pm
    It would be a real challenge to be renting and the pension the only income, especially here on the Sunshine Coast. But being a home-owner and only having the pension is no picnic either, especially if paying a mortgage still. Those who own their homes still have to fork out for rates, perhaps body corporate fees, insurance, refurbishment and repair costs, I worked out that I am as much out of pocket as my brother-in-law who rents a unit. One can only give up so much....I want to keep my car but may be forced to let it go. Then I've lost my independence, and would have to pay for taxis etc. Ya can't win, I tell yah!
    jaycee1
    8th Jun 2018
    2:18pm
    patti, I can understand you not wanting to give up your car if you can help it. Traveling by public transport can be very, very frustrating.

    Especially if you're going shopping, as you need to break it down to what you can carry. Not fun at all. :(
    Charlie
    7th Jun 2018
    4:37pm
    I have an income problem, too much going out and not enough coming in.

    There is an age pensioner concession that the government has forgotten about and it has slowly been eroded. It is the annual free rail trip. I'm assuming its still there as I haven't used it for a few years, because it was just not competitive with air travel.

    On some trains it is not free anymore, there is a $50 fee coming and going. There must be a lot of age pensioners living a long way from nearest relatives because of the way people have needed to travel for employment, leaving the oldies on their own.

    Instead of making this concession ineffective, the government should have made it an air fare once a year to anywhere in the state, so people with medical conditions don't have to sit up on the train for a day and a night. This would define the kind of service the age pension should be.
    Old Geezer
    7th Jun 2018
    4:51pm
    Airfares are so cheap that one wouldn't worry about even getting a discount now days.
    Old Geezer
    7th Jun 2018
    4:52pm
    Booked a flight from Gold Coast to Sydney the other day for $45.
    MICK
    7th Jun 2018
    5:26pm
    That's off the retired MP Gold Card OG. Charlie does not have one of those.
    Air fares are not all cheap and if you listed to $20 million man Alan Joyce the Qantas CEO fare increases are a coming. Likely because they have to find the money to pay Joyce.
    Old Geezer
    7th Jun 2018
    5:43pm
    These airfares are available to anybody who wants to fly.
    Charlie
    7th Jun 2018
    5:55pm
    I need to go from Townsville to Brisbane. Last time on the train it took an afternoon and a full night to get there. That was the fast train.

    Last time I tried discount air fares I found they got me into Brisbane at times when there was a long wait for public transport and a taxi quickly made the air fare discount disappear.
    Then the airline got more money when I booked the seat I wanted and when I payed some anti terrorist insurance I never heard of.
    A pair of play school scissors I use to cut up medications had to be left at Brisbane because they were a security risk.
    Old Geezer
    7th Jun 2018
    7:25pm
    Charlie like everything you have to learn the rules and play the game. I don't worry too much about picking seats and we usually buy one lot of luggage between the two of us. I also unlick all those boxes they have ticked for you which means I pay nothing extra. Got annoyed last time I booked as they didn't have a free way of paying for the flight and charged me $1.33 extra. So I used a credit card where I got points so I clawed bit of that back too.

    At Perth airport the taxi line and shuttles lines were very long do I walked about 50 metres and caught a bus into the city for $1.80. I usually take the train in Sydney and Brisbane even though I have to pay extra as they are private trains. In Auckland and Christchurch I take shuttle buses and local buses which are quite cheap.
    Anonymous
    7th Jun 2018
    10:45pm
    o.g. you are wasting your breath and time for even trying to put sense to this lot, all they want is complaining and complaining, you have to feel sorry for this miserable lot who should enjoy their retirement instead of hoping to find and even are spending time searching for things to bitch on, easier to blame the government then putting in some efford yourself.
    Old Geezer
    8th Jun 2018
    11:20am
    Agree no one today wants to take the blame for their own failures. Most just want to blame others instead of giving themselves a big kick up the posterior and moving on. People are such fools most of the time.
    HarrysOpinion
    8th Jun 2018
    3:24pm
    Do retirees have an income problem?
    One thing for sure is this, many pensioners who expected their pension to be in their bank account on Monday 11 June will be very disappointed. They will need to starve for 24 hours and get access to their pension on Tuesday! Now that's a real problem!
    Old Geezer
    9th Jun 2018
    4:25pm
    No Labor Day Coffee Shop treat then.
    HarrysOpinion
    9th Jun 2018
    9:57pm
    You meant, no Queen's Birthday treat!


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