Comfortable retirement lifestyle costs increase for couples and singles

According to the ASFA retirement standard figures for June quarter 2022, retired couples will need to spend $66,725 per year and singles $47,383 to live comfortably.

These figures have jumped 2% and 1.9% respectively compared to the previous quarter.

While in the year to 30 June, costs rose 6.2% for couples and 6.7% for singles, climbing above the official inflation rate of 6.1%.

Significant price rises for items such as food, fuel, and health costs are the leading contributors. 

Over the past 12 months, the spending categories showing the largest annual increases were: automotive fuel, 32.1%; vegetables, 14.6%; coffee and tea, 9.3%; and bread, 7.2%. 

ASFA Deputy CEO Glen McCrea said retirees are also forking out more money on wellbeing items amid ever-increasing healthcare costs.

"While there is considerable subsidisation of health costs and benefits being paid from private health insurance, out of pocket expenses remain substantial for items such as dental treatment, optical expenses, and gap payments for procedures in hospitals,” Mr McCrea explained.

"Private health insurance premiums rose on average by 2.7 % from 1 April with some major insurers increasing premiums by more than 3%.

"However, other insurers have postponed premium increases until later in the year."

^{Source: ASFA budgets for households and living standards for those aged around 65}

For retirees aged around 85, retirement budgets for a comfortable lifestyle increased by a comparatively modest 0.8% from the previous quarter.

Older retirees' budgets were not directly affected by the increase in petrol prices as there is no allowance for car ownership for this age group. 

The report found despite comfortable retirement costs increasing, compulsory super is doing its job with helping people deal with rising costs with more retirees having received the benefits of compulsory super since its introduction in 1992.

ASFA also examined data from the Department of Social Services and found 40% of new retirees receive an age pension indicating the success of compulsory super. 

“Despite the challenges of recent years, superannuation continues to achieve its objective of materially lifting the standard of living of older Australians and allowing more retirees to achieve the dignity they deserve in retirement," Mr McCrea said.

Advertisement

Want to earn a fixed interest rate on your cash? The table below features term deposits with some of the highest interest rates on the market for a six-month term. 

Advertisement

Term Deposit - 6 months

Product Features

• Easy online application
• Interest can be paid to other institutions
• Maturity alert by email and phone

Minimum deposit$5,000

5.00%Interest rate p.a.

6Term

More details

Image by Noelle Otto via Pexels