Health and transport drive up household costs

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The price increases that had the biggest effect in the quarter were transport, driven by a 6.9 per cent increase in fuel; and health, where medical and hospital costs were 3.1 per cent higher.

Transport has been a significant driver of price increases in the past year, mainly due to higher petrol prices, but this has flown under the radar because of electricity and house price rises.

Transport costs had the biggest effect on the Constrained and Affluent tribes, with Cash-Strapped tribes spending a smaller proportion of their income in this area.

Health costs significantly influenced retirement affordability with private health insurance increases the main culprit. Constrained Couples were most affected because they spend the largest proportion of their income on health.

Surprisingly, clothing and footwear also pushed up the cost of living. While the impact was only small, it was unusual because clothing and footwear have been going down in price. In fact, prices are almost identical to what they were in 1990.

Three categories pushed the cost of living down for retirees: recreation, communications, and food and non-alcoholic beverages.

The quarter also saw a small drop in the price of utilities, driven by discounting in electricity and gas, but the decreases were minor when compared with recent increases.

Are you worried your money won’t last? The Retire Planner™ tool has all the information you need.

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Written by Matt Grudnoff

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