More retirees worried about retirement income a warning for Govt

The ABS today released its national FY23 Retirement and Retirement Intentions report, revealing an increase in the number of retired Australians and heightened concern about retirement income.

RLC Executive Director Daniel Gannon said Australia’s rapidly ageing population means governments need to “double down” on affordable age-friendly housing initiatives.

“This report tells us what we already know – Australia is fast approaching a ‘silver tsunami’, bringing with it significant socio-economic challenges for the nation,” Mr Gannon said.

The Retirement and Retirement Intentions report released by the ABS reveals:

  • The main factor influencing someone’s decision about when to retire is financial security.
  • Between FY21 and FY23, the government pension remained the main source of income for most retirees.
  • There are 4.2 million retirees around Australia, with 130,000 people retiring in 2022 and the average age being 64.8 years.
  • 710,000 people around Australia intend to retire in the next five years, with 226,000 in the next two years.
  • Between FY21 and FY23, Queensland had the greatest increase in retirees (+32,000), South Australia had the highest increase in proportion of retirees (from 45 to 46%), and Tasmania had the largest decrease in proportion of retirees.

“Given household debt and financial security are impacting the age at which Australians are retiring, suitable and affordable housing options are more important than ever,” Mr Gannon said.

“Unfortunately, a rapidly growing number of Australians are retiring with mortgage debt while the aged pension remains the main source of income for most retirees.

“This spells bad news for a lot of older Australians who have recently retired or many of the 226,000 people intending to retire in the next two years.

“Units in retirement communities are priced on average 48 per cent lower than median house prices in the same postcode, meaning these communities can help address retirement income challenges.

“There is also an important role older Australians can play within housing markets when they consider ‘rightsizing’ into homes better designed and suited to their ageing needs.

“This serves a dual purpose in freeing up housing stock for younger aspiring home buyers, but it also frees up retirement income given the affordability value proposition of retirement communities,” he said.

However, Mr Gannon reiterated the RLC’s critique of the recent Federal Budget.

“The budget provided no plan to accommodate and care for older Australians at a time when the nation is ageing and battling a housing supply war,” Mr Gannon said.

“The unfortunate reality is that Australians aren’t getting any younger, and every day that passes without a plan to house and care for older Australians appropriately and affordably is a missed opportunity.

“While commonwealth rent assistance is welcome news for some Australians, the existing eligibility thresholds exclude the majority of people living in affordably priced retirement units.

“To say that reform is needed in this area is a chronic understatement,” he said.

/Public Release. View in full here.