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Centrelink age pension ‘not enough’ as Aussies urged to seek retirement advice

New research found Aussies think they need an extra $10,000 a year, or $15,000 a year for couples, to meet their basic retirement needs.

Tamika Seeto
·Finance Reporter
·3-min read
Jenny and retirement money
69-year-old Jenny Wynen said she was worried about the cost of retiring and encouraged other Aussies to seek help. (Source: Supplied/Getty)

With the cost of living pushing everyday prices higher, Aussies have said the Age Pension is “not enough” for them to meet their basic retirement needs. Aussies are being urged to seek help about their superannuation and retirement so they aren’t “worse off”.

The Age Pension recently increased to $1,144.40 for singles and $1,725.20 for couples per fortnight, following government indexation. However, 90 per cent of Aussies over 50 surveyed by the National Seniors and Challenger said this wasn’t enough to meet their basic needs by itself, even if they owned their own home.

Half of homeowners surveyed believe they need an extra $10,000 a year on top of the age pension payments to meet their basic needs, while couples would need an extra $15,000 a year.

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National Seniors Australia CEO Chris Grice said the age pension wasn’t enough to cover costs like private health insurance, heating and cooling, and vehicle and home maintenance costs.

“This research clearly shows that many older Australians are struggling to reconcile the cost of living with their retirement income,” Grice said.

“It’s not just about making ends meet; it’s about ensuring that retirees have the financial security to live with dignity and peace of mind.”

The Association of Superannuation Funds of Australia (ASFA) estimates that singles need $33,134 per year for a modest retirement and $52,085 for a comfortable retirement, while couples need $47,731 and $73,337 respectively. This assumes the retiree owns their home outright.

These amounts are below the current age pension rates of $29,754.40 for singles and $44,855.20 for couples.

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Former carer Jenny Wynen retired three years ago and told Yahoo Finance she had concerns about how she would fund her life in retirement.

The 69-year-old said she had limited superannuation, despite making extra contributions, and had taken time out of the work to have her daughter.

“I was of the impression that you needed $1 million to retire. Being single I thought I would be having to do this in my 70s and it is a daunting thought,” she told Yahoo Finance.

“You don’t want to do that because most people want to retire when they are healthy and not wait until they have worn themselves out.”

Wynen said she received an inheritance from her mother and was the push she needed to seek financial advice. By getting advice on her situation, she found out she could afford to retire earlier than she initially planned.

Research from ASFA found a staggering 49 per cent of all adult adults and around 40 per cent those over 65 hadn’t consulted any source information on preparing for retirement.

That could be through a financial adviser, friends and family, online resources, super fund advisers, or through the media.

“It means many Australians may end up worse off than they should be in their post-working lives, simply because they haven’t been empowered with the relevant guidance,” ASFA CEO Mary Delahunty said.

Delahunty noted the cost of receiving financial advice remained a barrier for “the average working Australian”, with Adviser Ratings noting the average cost can be at least $3,500.

Wynen said this cost ended up being worth it for her and she urged others to seek advice early if they could.

“After speaking with [a financial adviser], we looked at all my finances and worked out what I could live on,” she said. “It worked out that I could have a comfortable retirement.”

Wynen currently receives a part-pension from the government. After receiving financial advice, she used her superannuation and savings to set up a lifetime annuity, which provides a guaranteed income.

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