THIS SITE IS INTENDED FOR ADVISER USE ONLY

By clicking through to the Investments or Platforms site below you confirm that you are a licensed adviser operating under an Australian Financial Services License.

Are you retire ready?

Recent analysis of Australians' readiness for retirement shows whether or not we’re on track for a comfortable retirement.

The results are in. Around half of Australian households are expected to have enough for a comfortable retirement1.

While the news could be better, the upside is that many Australians who may not currently be on track for a comfortable retirement are very close. 18 per cent of Australians are projected to have within 80 to 99 per cent of what they would need for a comfortable retirement.

“The good news is that many Australians who may not currently be on track for a comfortable retirement are very close. A little bit of planning could see them reach the comfortable level,” said Linda Elkins, Executive General Manager Advice, Commonwealth Bank.

The findings were recently published in the CommBank Retire Ready Index, a comprehensive analysis of Australians’ retirement savings and resulting retirement incomes.2

The report projects the percentage of the population aged 25-64 who are expected to have sufficient assets, including superannuation, personal wealth and Age Pension entitlements, to meet a comfortable level of retirement.

The analysis captures important factors affecting retirement adequacy, providing insights into the retire readiness of Australians by demographic split, including age, gender, state and couple/single status.

The overall results are mixed across demographics, and highlight the growing importance of superannuation in helping Australians achieve a comfortable retirement.

25-29 year-olds will need to save harder for a comfortable retirement than other age groups, due to their longer life expectancies. Superannuation will play an important role and will comprise, on average, 78 per cent of retirement assets for 25-year-olds working today.
 

In the 60-64 year-old age group, couples are expected to be better off than singles but may have reduced retire readiness as they have not received the long term benefits of compulsory Superannuation Guarantee contributions.

On the other hand, younger age groups are expected to have less in assets at retirement outside of superannuation when compared with their older counterparts.
 

The report also shows that more men than women are on track for a comfortable retirement. Women tend to have lower retirement savings due to career breaks during their child bearing years, and lower average income levels throughout their working lives. And, because women have longer life expectancies, they need more assets to maintain a comfortable level of retirement.

With retirement assets, including superannuation, personal wealth and Age Pension entitlements, 53 per cent of Australians are on track for a comfortable retirement. However, when the Age Pension is removed, the number of households who can afford a comfortable retirement reduces to 17 per cent, and to just six per cent when the calculations are based on superannuation only.

A bit of planning goes a long way


It’s important that people of all ages understand how much they will need to save now to secure their financial futures. Many people are projected to have close to what they will need, so a little bit of planning could see them reach the comfortable level. Younger workers can help their super to be in a good position in three easy steps.

“The CommBank Retire Ready Index shows how important superannuation will be for the long term financial wellbeing of young Australians. Many people do not become engaged with superannuation until later in their working lives, but taking a keener interest in superannuation now, consolidating accounts into one super fund and contributing a little more each week can help younger Australians stay on track for a comfortable retirement,” Ms Elkins said.

How retire ready are you?

To help you work out if you’re on track for a comfortable retirement, Colonial First State has developed a retirement calculator.

This is a good first step to see how retire ready you are, and is a useful resource to help you get on track to reach your goals for a comfortable retirement.

Five tips to be retire ready

  1. If you have more than one superannuation fund, consolidate your accounts to help save on fees.
  2. Find out how much you’ll need for a comfortable retirement using our retirement calculator.
  3. Develop a retirement plan – talk to a financial adviser about your retirement goals.
  4. Revise your household budget to see if there is anything more you can contribute to retirement using our budget planner tool.
  5. Seek advice on how the changes to superannuation on 1 July 2017 will affect your retirement.
     

Disclaimer

Colonial First State Investments Limited ABN 98 002 348 352, AFS Licence 232468 (Colonial First State) is the issuer of super, pension and investment products. This document may include general advice but does not take into account your individual objectives, financial situation or needs. You should read the relevant Product Disclosure Statement (PDS) carefully and assess whether the information is appropriate for you and consider talking to a financial adviser before making an investment decision. A PDS for Colonial First State’s products are available at colonialfirststate.com.au or by calling us on 13 13 36.