Super turns a safety-net retirement into a comfortable one: ASFA

A comfortable retirement for a couple who own their own home now costs $1513 a week, according to the latest Association of Superannuation Funds of Australia (ASFA) Retirement Standard, which found that super remains key to comfortable retirement.

For a single homeowner, it costs $1076 a week.

The full Age Pension covers around 60% of a comfortable retirement for a couple and around 56% for a single.

"The Age Pension is a social welfare net that guarantees no older Australian has to live in poverty," ASFA chief executive Mary Delahunty said.

"It was never designed to fund the kind of lifestyle in retirement that most Australians aspire to. Super is the difference between watching every dollar and having a sense of financial security in retirement."

ASFA provides three levels of budget for retirees for a comfortable, modest and Age Pension-only retirement. The three levels differ little on essentials like food and utilities, while it is the discretionary spending that makes life comfortable.

"At the comfortable level, a couple can afford top-level private health insurance, eat out most weeks, take a domestic holiday each year and an overseas trip every few years. They can run a good car that is regularly serviced," Delahunty said.

"At the modest level, health cover is basic, probably a hospital plan only, holidays are domestic only, and you eat out very occasionally. On the Age Pension alone, most of these things drop out of your budget entirely."

New research by YouGov for Australian Retirement Trust (ART) showed 81% of participants with super would likely spend part of their retirement travelling around Australia if money and health weren't barriers.

"Australians want the freedom to enjoy their time, explore the country and stay connected with family and friends," ART executive general manager of advocacy and impact Anne Fuchs said.

"For many people that means seeing more of Australia at a slower pace, with the flexibility to decide where the road takes them."

However, 65% of Australians with super see the rising cost of living as a concern.

"Retirees are among the groups hit hardest by the cost-of-living crisis because their budgets are weighted towards the things going up in price the most," Delahunty said.

For homeowners aged 65 to 84, the comfortable retirement budget rose 0.5% for couples and 0.4% for singles in the June quarter.