Research by the Association of Superannuation Funds of Australia (ASFA) has shown that couples aged around 65 living a comfortable retirement needed to spend $62,083 per year, up 0.3 per cent, and singles $43,901, up 0.5 per cent on the previous quarter.
The increase from a year earlier was 1.8 per cent for couples and 1.6 per cent for singles.
“COVID-19 has had a substantial impact on Australia’s financial and economic conditions, but there has been a partial unwinding of both price increases and decreases that immediately flowed from the impact of the pandemic,” said ASFA CEO Dr Martin Fahy.
ASFA noted that retiree lifestyles were yet to return to normal as restrictions on travel and changes to entertainment and dining-out options had a significant short-term impact on retirement lifestyles.
During the September quarter, health insurance premiums remained unchanged but would have increased from 1 October by around 3 per cent for many retirees.
“Recent reductions in interest rates and dividends are having an impact on the financial position of many Australian retirees,” Dr Fahy said.
“Dramatic changes in our lifestyles had a big impact on demand and prices right across the economy, but for at least some categories of expenditure, there is a return to something closer to normal.”
Dr Fahy noted that the increase in the cost of retirement despite lifestyle changes means members who are currently still working require greater accumulation of superannuation during their working lives.
“For wage earners, the increases in costs in retirement have highlighted the need for the superannuation guarantee to move from 9.5 per cent to 12 per cent as legislated. Over the year to September 2020, official figures indicate that wages grew by only 1.4 per cent on average for the entire economy, and by only 1.3 per cent in the private sector. Over the September quarter, increases in wages in the private sector averaged just 0.1 per cent,” the ASFA statement read.
Increases in retirement costs are outstripping growth in wages and higher contributions are needed for future retirees to achieve the standard of living they want and deserve in retirement.
23 November 2020
BEc (Acc), MBA, CPA, FFin
David has been in the Financial Services Industry for nearly 30 years. He was one of the founding Directors of the successful Financial Planning and Stockbroking Practice, Henderson Gregory Forrest, for a decade. Prior to that, he held senior roles in companies such as ING, KPMG Accountants and AMP. David was previously Chairman of OAMPS Superannuation Trustee Board and currently serves as an independent Board Director for several companies.
David’s extensive experience in all forms of superannuation, including Self Managed Super Funds (SMSF), Defined Benefit Funds, retirement funding through Account Based Pensions, stockbroking with a focus on Direct Share Investment, Taxation/Remuneration Planning, Centrelink, Aged Care and business management, equip him to advise expertly on all aspects of Financial Advice.
Those with a particular interest in superannuation/SMSFs, direct share investment, salary packaging or applying for the Centrelink Pension will find his knowledge and ability in formulating and implementing creative, logical and simple wealth creation strategies a valuable asset.
David maintains a strong personalised client service focus, providing tailored solutions for clients.
David Forrest is an Authorised Representative of Integrity Financial (SA) Pty Ltd ABN 16 133 921 187 — AFSL No 334846
Business Finance Manager
B Bus (Acc), CPA
Michelle’s career has spanned across the Financial Services, Retirement Living and Aged Care industries working in the private sector, not for profit and more recently with the state government for over 20 years. Her experience extends to many facets of the financial services industry, having worked in superannuation administration, technical support and financial planning practice administration.
Commencing with AMP and subsequently working in commerce and accounting roles with companies such as Brambles, Adelaide Bank Retirement Services, ECH Inc and SA Health and Wellbeing, Michelle returns to financial services after working in practice financial management at Henderson Gregory Forrest. This wide range of experience from senior accounting and management roles has provided Michelle with a strong background in business administration.
With an astute financial acumen and keen interest in business improvement strategies, Michelle ensures the smooth running of the Integrity Financial Advisory practice providing valued management support to our personalised client service focus.
Client Service Manager
Jasmine has worked in the financial services industry for over 12 years in all areas of client administration, working with David since 2013.
Jasmine has extensive knowledge and experience in client service including implementation of advice, portfolio reporting, assisting with the establishment of Self Managed Super Funds (SMSFs), term deposit management and a long history of helping clients with their enquiries.
Jasmine’s attention to detail, yet gentle approach, means she is able to solve the trickiest of questions for our client community.
Jasmine has gained her Certificate III in Financial Services qualification.
Client Service Manager
Merrilyn has worked in the financial services industry for over 11 years in all areas of client administration, and is a new addition to our client services team, returning from Melbourne to join the team in June 2019.
Merrilyn has extensive knowledge and experience in client service including implementation of advice, managed fund administration, assisting with the establishment of Self Managed Super Funds (SMSFs) and process improvement for the previous practices she has worked with. Merrilyn’s experience with direct shares constitutes the other part of our administrative support for direct equity investments.
Merrilyn’s warm and caring nature continues to endear her to our clients and she has already established herself as a valued member of our team.