The latest data from the Association of Superannuation Funds of Australia (ASFA) has shown Australian retirees will require a slightly higher annual income to cover the cost of living for those seeking a comfortable lifestyle in their retirement.
ASFA’s Retirement Standard for the December 2020 quarter indicated the cost of living for retirees aged around 65 wanting to enjoy a ‘comfortable retirement’ increased by 0.9 per cent compared to the September quarter, with couples needing to spend $62,562 a year and singles needing to spend $44,224 each year to meet the lifestyle standard.
The association pointed out health insurance premiums increasing by around 3 per cent from 1 October after remaining unchanged for most of 2020 would have contributed to the additional rise in expenses for many retirees.
In addition, the December quarter saw the price of domestic holiday travel and accommodation go up by 6.3 per cent as a result of state and territory borders being reopened for a time following the pandemic.
ASFA also noted the reopening of restaurants had contributed to the price of dining out increasing by 1.1 per cent during the same period.
“COVID-19 impacted just about every aspect of Australia’s financial and economic conditions. Now, price increases are returning to a more standard pattern following a few quarters of suspension or delay in key costs, such as health insurance premiums,” ASFA deputy chief executive Glen McCrea said.
“As a greater number of people ventured out of their homes in search of a meal out or a domestic holiday, we saw price rises in those areas, which is not altogether favourable for retirees on a budget.”
In October, Association of Independent Retirees president Wayne Strandquist said self-funded retirees had been overlooked in the federal budget, which should have included support measures to offset retirement income losses stemming from the impact of COVID-19 on the economy.
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