For many older Australians, the goal of a secure retirement is becoming harder to afford. Core living costs such as energy, council rates and healthcare have surged ahead of inflation, prompting retirees to revise their financial strategies. According to new data, the cost of a comfortable retirement has reached a record $76,505 annually for a couple and $54,240 for a single homeowner. These figures have risen noticeably over the past 12 months.
The findings come from the Association of Superannuation Funds of Australia, which monitors retirement living expenses. In the year leading up to September, costs increased by 3.5% for couples and 3.6% for singles, both of which exceed the national Consumer Price Index rise of 3.2%. Electricity experienced one of the most significant increases, jumping by 9% in three months. Domestic holidays, a popular option in retirement, rose by 5.2%.
A secure retirement now demands a substantial superannuation balance. ASFA suggests couples need around $690,000 and singles need $595,000, in addition to age pension support and assuming they own their home outright. This amount covers essentials such as quality private health insurance, utility bills, regular leisure activities and occasional international trips. However, rising prices are forcing many to make difficult choices, including drawing more from their super, cutting non-essential spending or downsizing their home.
While greater super savings have helped some retirees cope, many are not in a position to absorb growing costs. Increasing numbers are seeking advice from financial planners, adjusting investment strategies, reviewing risk levels and checking eligibility for government supports like concession and health cards. Some are also considering long-term options such as using home equity or shifting to more sustainable spending habits.
Australia’s superannuation system has improved financial independence for many retirees. Yet, the rising cost of essentials continues to create uncertainty. Experts agree the system is easing reliance on public pensions, but maintaining affordability in retirement relies on controlling inflation across key sectors including energy, healthcare and housing.
