One group of Australians is getting smashed by the cost of living harder than others
Retired Australians are being hit harder by the surging prices than the rest of the population, as the cost of a comfortable retirement skyrockets.
Couples who own a home now need $78,998 a year for a comfortable retirement, according to an updated benchmark by the Association of Superannuation Funds of Australia (ASFA).
Retired Australians are being hit harder by the surging cost of living than the rest of the population. Glenn Hunt/Fairfax Media
The peak body said single home owners need $56,166 a year to have a sense of financial security in their golden years.
Meanwhile, the maximum age pension is currently $905 a week for a couple and $600 for a single, which will rise slightly on September 20.
The full age pension covers about 60 per cent of a comfortable retirement for a couple and around 56 per cent 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.”
The age pension is adjusted twice a year in line with the cost of living, which protects pensioners from rising prices.
However, Delahunty said the gap between the age pension and a comfortable retirement continued to grow every year.
“Super is the buffer between a life in which the bare essentials are covered by the age pension,” Delahunty said.
“Feeling comfortable and financially secure in retirement.”
While the consumer price index increased 3.8 per cent in the 12 months to June 2026, the cost of key living expenses were also on the rise.
Energy prices are just one element of the cost of living that has surged over the past year. AAP
Electricity costs increased 22.4 per cent after the end of state and federal rebates, while the cost of insurance was up 4.9 per cent.
Medical and hospital services went up five per cent and costs related to the maintenance and repair of cars shot up by 6.5 per cent.
Hairdressing and grooming services went up 4.2 per cent, while meals out and takeaways cost four per cent more.
“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.
“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.
“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.”
The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.
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