Yahoo Finance Superannuation squeeze: The staggering amount you now need for retirement
Singles need to have $982 per week to retire comfortably, while couples need $1,382 per week.
The amount Aussies need to retire and fund their golden years has hit a new record high, as insurance, food and electricity costs weigh on retiree budgets.
A single retiree now needs $51,278 per year for a comfortable retirement, while a couple needs a new record high of $72,148 per year, the Association of Superannuation Funds of Australia (ASFA) has revealed.
This is an increase of around 3.5 per cent annually, which is lower than the official inflation figure of 4.1 per cent.
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Increased insurance prices drove retirement costs higher, with premiums up 16.2 per cent annually. Food and electricity prices also rose above inflation, up 4.5 and 6.9 per cent, respectively.
“Retiree budgets have been under substantial pressure for the past two years due to the high cost of essential goods and services,” ASFA CEO Mary Delahunty said.
“Fortunately, we are seeing [an easing in] price increases in the key categories that make up retiree budgets – home and contents insurance, fruit and vegetables, fuel and electricity.”
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Singles now need $982 per week at their disposal to be comfortable, while couples need $1,382 per week - both well above the current age pension payment. This is currently $1,002.50 per fortnight - or $501.25 per week - for singles.
Importantly, these budgets assume the retiree owns their home outright and is relatively healthy.
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Cost breakdown
Here’s a weekly cost breakdown for singles aged around 65 wanting a comfortable retirement:
Housing: $139.37
Energy: $51.54
Food: 141.76
Clothing: $28.26
Household goods and services: $85.24
Health: $112.94
Transport: $179.02
Leisure: $221.33
Communications: $22.88
Total per week = $982.34. Total per year = $51,278.
How much superannuation do I need?
A single retiree needs $595,000 in their superannuation balance to retire comfortably and get the age pension at age 67, ASFA says. A couple needs $690,000 in their nest egg.
This allows retirees to maintain a “good standard of living”, including daily essentials, insurance, exercise and leisure activities, and occasionally eating out and travelling.
For a more modest retirement, which is slightly above the age pension, ASFA says singles and couples need $100,000 in their superannuation. Per year, ASFA said singles would need $32,666 and couples would need $46,994 to fund this modest lifestyle.
