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Do you own, or are you working towards owning, your own place? Or are you planning to continue renting indefinitely? Research from the Association of Superannuation Funds of Australia (ASFA) suggests non-home owning couples who hope to enjoy retirement with a few frills may need seven figures in the super fund to pay for it.1
The Australian Bureau of Statistics (ABS) states that just over 76% of Australian households headed by an individual aged 65 or older own their homes outright. It says 8% are still paying off mortgages and almost 14% rent privately.2
But skyrocketing property prices nationwide mean it’s taking people longer to get into – and pay off – their own places and a growing number of Australians may never do so.
According to the Australian Bureau of Statistics’ Housing Occupancy and Costs study released in late 2015, 67% of households owned their own homes, with or without mortgages, while 31% of households were renting.3
According to the research, a comfortable lifestyle in Brisbane costs around $77,000 a year for a couple aged around 65 and living in private rental accommodation, while a single renter hoping to enjoy a little of the good life can expect to outlay around $58,000, according to ASFA’s December 2016 Retirement Standard Update.
Published quarterly, the Retirement Standard benchmarks the budgets Australians need to maintain themselves in a range of circumstances during retirement.
In order to generate these levels of income, ASFA estimates that couples will need a superannuation balance of $1,112,000 and singles a balance of $940,000.
A couple prepared to live more modestly – think cheap eats, no overseas holidays and limited funds to spend on clothing, grooming and leisure – will need around $49,000 a year and a super balance of $395,000.
Singles living modestly will need around $37,000 and a super balance of $325,000.
By contrast, couples over 65 who own their own homes need around $60,000 per a year and a super balance of around $640,000 to live comfortably, according to ASFA.
For home-owning single folk, the figures are around $43,500 and $545,000 respectively.
QSuper offers members exclusive access to financial advisers from QInvest,4 who offer different levels of advice to suit the needs of our members. QInvest has helped more than 100,000 Queenslanders plan for a more comfortable financial future and can help members with a range of advice offerings.
Call Qinvest advisers at 1800 762 033 or qinvest.com.au
1 ASFA media release: Retirees renting need more than $1 million to be comfortable. 13 March 2017
2 Australian Bureau of Statistics. 4130.0 - Housing Occupancy and Costs, 2013-14. Table 10
3 Australian Bureau of Statistics. 4130.0 - Housing Occupancy and Costs, 2013-14; released 16 October 2015
4 QInvest Limited (ABN 35 063 511 580, AFSL and Australian Credit Licence number 238274) is ultimately owned by the QSuper Board (ABN 32 125 059 006) as trustee for the QSuper Fund (ABN 60 905 115 063). QInvest Limited is a separate legal entity, responsible for the financial services and credit services it provides. Advice fees apply.
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