Cost of living the top concern to retire | Australian Markets

The latest version of Colonial First State’s (CFS’) annual Rethinking Retirement report has discovered a drop in retirement confidence amongst retirees and pre-retirees primarily due to the value of residing.

The analysis, primarily based on a survey of 2,250 Australians, indicated that the quantity of retirees who really feel financially comfy has fallen in comparison with final 12 months, with 64 per cent now in a position to “comfortably enjoy retirement” – down from 71 per cent 12 months in the past.

Of the respondents on the pre-retirement stage, 54 per cent mentioned they don’t consider themselves succesful of retiring comfortably. For these over 50 years of age, this determine will increase to 57 per cent.

Respondents additionally cited the associated fee of residing because the “number one concern” that has effects on their expectations of consolation in retirement, with over 75 per cent of retirees having their pension funds taken up by important prices comparable to groceries and utilities. Equally, precisely 50 per cent of retired owners mentioned they’re additionally utilizing their pension funds to save lots of for surprising emergencies or bills.

Additionally, slightly below one quarter of retirees (22 per cent) have needed to proceed paying off debt utilizing pension funds; amongst those that don’t own a home, this determine rises to virtually one third (30 per cent).

The report additionally emphasised the connection between financial advice and knowledgeable retirement choices as suggested respondents confirmed more confidence throughout a number of points, together with managing one’s own funds (70 per cent versus 58 per cent unadvised), general financial scenario (72 per cent versus 42 per cent unadvised), retiring debt-free (71 per cent versus 45 per cent unadvised), having enough money to retire (70 per cent versus 30 per cent unadvised) and attaining one’s financial targets (70 per cent versus 45 per cent unadvised).

The analysis additionally steered that youthful Australians had been more open and keen to interact with a financial adviser so as to obtain their financial targets.

“The cost of living has shaken confidence in retirement expectations. However, it has also led to more people engaging with their super and seeking assistance with retirement planning,” Kelly Energy, CFS Superannuation CEO, mentioned.

“The findings once again highlight the positive impact of financial advice, with those who receive advice twice as likely to feel financially prepared and on track to reach their retirement goals.”