Investment management firm Challenger commissioned a survey of over 1,000 Australians aged 40+, with the results showing over a quarter (27%) of retirees were cutting back on their food shopping expenses, while more than one-third (37%) were spending less on clothes and accessories amid COVID-19 induced concerns over their financial future. 

One in twenty (6%) are planning on cutting travel and holiday plans, one in five (20%) are looking to increase their savings balance, and almost half (49%) of retirees say they don't feel confident about their financial security over the next five years. 

In total, 65% of retirees said they were concerned about their income in retirement. 

One retiree of five years, Ian Morris, told Savings.com.au his savings have fallen by 8% thanks to COVID-19's effect on the sharemarket, which is worth about a year and a half of spending money. 

"This has made us feel less secure about our financial future," Mr Morris said. 

"Basically, we will have to be more careful and frugal with luxuries such as restaurants and holidays. Although overseas holidays are forcibly cancelled so that is some advantage for us, we will take limited Australian holidays instead.

"We feel unsure of our long term financial wellbeing as we will need to spread limited resources further over time."


Looking more broadly, the COVID-19 pandemic has caused nearly all (97%) of adults aged 40 and over to be concerned about the Australian economy over their own health (81%). 

Four in five meanwhile (80%) were concerned about their personal financial security in the future, which follows similar research earlier in May that found three-quarters (77%) were experiencing financial stress due to coronavirus. 

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.

Provider

At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]5000$product[$field["value"]]$product[$field["value"]]More details
  • Easy online application
  • Interest can be paid to other institutions
  • Maturity alert by email and phone

Term Deposit - 6 months

  • Easy online application
  • Interest can be paid to other institutions
  • Maturity alert by email and phone
At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]10008$product[$field["value"]]$product[$field["value"]]More details

Online Term Deposit - 12 months

    Annually, At Maturity, Monthly$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]1000031$product[$field["value"]]$product[$field["value"]]More details

    Term Deposit ($10000+) - 12 months

      Annually, At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]100031$product[$field["value"]]$product[$field["value"]]More details

      Term Deposit - 12 months

        Annually$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]5000$product[$field["value"]]$product[$field["value"]]More details

        Term Deposit (Platinum Plus Club Members) - 12 months

          At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]50031$product[$field["value"]]$product[$field["value"]]More details

          Term Deposit ($500 - $1mn) - 12 months

            Annually, At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]1000$product[$field["value"]]$product[$field["value"]]More details

            Term Deposit ($1000-$499999) - 12 months

              At Maturity, Annually$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]50001$product[$field["value"]]$product[$field["value"]]More details

              Term Deposit ($5k-$25k) - 12 months

                At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]10007$product[$field["value"]]$product[$field["value"]]More details

                Term Savings ($1000-$500000) - 12 months

                  Annually, At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]1000031$product[$field["value"]]$product[$field["value"]]More details

                  Term Deposit - 12 months

                    Annually, At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]10000$product[$field["value"]]$product[$field["value"]]More details

                    Term Deposit ($10k-$500k) - 6 months

                      At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]100000$product[$field["value"]]$product[$field["value"]]More details

                      Term Investment ($100k-$200k) - 6 months

                        At Maturity, Monthly$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]2500031$product[$field["value"]]$product[$field["value"]]More details

                        Term Deposit - 12 months ($5000-$25000)

                          Annually, At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]10000$product[$field["value"]]$product[$field["value"]]More details

                          Term Deposit ($10k-$500k) - 12 months

                            At Maturity, Annually$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]100031$product[$field["value"]]$product[$field["value"]]More details

                            Term Deposit ($1000+) - 9 month

                              At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]500031$product[$field["value"]]$product[$field["value"]]More details

                              Term Deposit - 12 months

                                At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]1000$product[$field["value"]]$product[$field["value"]]More details

                                Term Deposit ($1000+) - 12 months

                                  Important Information and Comparison Rate Warning

                                  All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of February 27, 2024. View disclaimer.

                                  Challenger Chief Executive, Distribution, Product and Marketing Angela Murphy said the results show COVID-19's effect on the economy and people's mental and financial wellbeing. 

                                  “Sixty-five percent of retirees are concerned about their income during retirement, and 57% said they plan to make changes to their finances," Ms Murphy said. 

                                  "Due to feeling uncertain about the future, unfortunately for many this means they are cutting back on necessities like food and energy bills.”

                                  Ms Murphy then added that very few Australians have actually sought financial help during COVID-19. 

                                  “This survey showed only a third of respondents have sought help for their finances, and of those, only 1 in 5 went to a professional financial adviser during this time," she said. 

                                  “We know from our previous research in this area that when people feel overwhelmed by their financial situation they tend to stagnate because they find the choices too complex or they simply don’t know how to take the first step.

                                  “The coronavirus pandemic has put retirement income in the spotlight and many older Australians are evidently questioning the confidence they previously had about their financial situation and what this might mean for their retirement plans over the longer term."

                                  Other key stats Challenger's research revealed include: 

                                  • Only half of respondents have taken, or are planning to take, action to address their current financial concerns
                                    (54%)
                                  • Nearly a third said they haven’t done anything to alleviate concerns about their financial security (29%)
                                  • Three-quarters of Australians surveyed were worried about their family or friends’ job status (77%)

                                  Australia Bureau of Statistics (ABS) figures for May show Australians aged 70+ experienced a 13.9% fall in employment figures - the second hardest-hit age group behind under-20s', who experienced an 18.5% fall. 

                                  As a result of all this, Challenger has launched a "retire with confidence" tool, designed to help Australians in retirement. 

                                  “The Retire with Confidence Tool helps Australians aged 60 to 80 understand how long their retirement income might last and the amount of Age Pension they may be eligible for," Ms Murphy said.

                                  "The tool also shows how including different types of investments and sources of income, such as a lifetime income stream, could improve their financial outcomes.”

                                  Need somewhere to store cash and earn interest? The table below features introductory savings accounts with some of the highest interest rates on the market.

                                  Provider

                                  010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                                  • Earn up to 5.40% pa by depositing $1,000 in the previous month
                                  • No account fees
                                  • Easy access to your money

                                  Saver Account (<$250k)

                                  • Earn up to 5.40% pa by depositing $1,000 in the previous month
                                  • No account fees
                                  • Easy access to your money
                                  020001$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                                  • $0 monthly account fee
                                  • Dip into your savings without losing your bonus interest

                                  Home Saver

                                  • $0 monthly account fee
                                  • Dip into your savings without losing your bonus interest
                                  02000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                                  No monthly fees
                                  • Download the App to open your account
                                  • Get better visibility of your spending within App!
                                  • Deposit $200 per month to activate bonus interest
                                  No monthly fees

                                  Save Account

                                  • Download the App to open your account
                                  • Get better visibility of your spending within App!
                                  • Deposit $200 per month to activate bonus interest
                                  4000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                                  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking

                                  Savings Account (Amounts < $250k)

                                  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking
                                  020000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                  HomeME Savings Account ($0 - $100,000)

                                    02001$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                    Growth Saver ($1 - $25k)

                                      010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                      Target Saver

                                        010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                                        For customers aged 14-35 years
                                        For customers aged 14-35 years

                                        Future Saver Account ( < $50k)

                                          05001$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                                          • Maximum Age - 24

                                          Goal Saver

                                          • Maximum Age - 24
                                          010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                          Boost Saver

                                            00.011$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                            Reward Saver Account (31 years +) ($0-$100k)

                                              01000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                              Bonus Saver Account (Amounts < $100k)

                                                0201$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                Reward Saver Kick Start (Amounts ≤ $1m)

                                                  00.010$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                  Life (< 30 years) (Monthly deposit)

                                                    5000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                    NetBank Saver

                                                      000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                      ANZ Save

                                                        010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                        Savings Maximiser (<$100k)

                                                          050$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                          Young Saver Account

                                                            0501$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                            Save up

                                                              02000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                                                              Bonus Saver (<$1 Million)

                                                                Important Information and Comparison Rate Warning

                                                                All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of February 27, 2024. View disclaimer.