With the introduction of compulsory superannuation for employees in place since the early 1990s, there is an ongoing shift from the reliance on government benefits to self-funded retirement; however government benefits continue to be the leading source of income for the majority of retirees. For Australians aged 55+ who have already retired, 78.6% currently receive some form of government benefits. The proportion of retirees receiving government benefits has decreased compared to four years ago (82.9%) according to the April 2014 Roy Morgan Research Single Source survey.
In comparison, 41.3% of retired Australians aged 55+ currently have superannuation, an increase from 33.5% four years ago. Three in five retired Australians have a savings account (60.3%) such as a term deposit, up from 54.1% in 2010. With investment properties being another potential source of income for retirees, ownership of property investments has also increased over the same period. Currently 7.2% of retired Australians aged 55+ have property investments compared to 6.4% four years ago.
Sources of Retirement Income
Source: Roy Morgan Single Source (Australia) May 2009 (n=12,799) – April 2010, May 2013 - April 2014; (n= 11,735)
Across the same four-year period, the average income retirees are living on has increased from $21,020 to $24,630 per annum however this remains well below the Australian average of $45,000 per annum. Retirees aged 55+ with property investments ($37,360 pa) have the highest income on average, followed by those with superannuation ($31,194 pa), while retirees receiving government benefits have the lowest income on average at $22,950 per annum.
Norman Morris, Industry Communications Director, Roy Morgan Research says:
“The majority of retirees live in a single-income household, which highlights the importance of having sufficient income in retirement. While 79% of retirees own their home outright, maintaining a similar standard of living as pre-retirement would be impossible for some, with the average income among retirees being far below the average.
“In the future, a greater number of Australians will be retiring with superannuation and the government’s push towards increasing the compulsory superannuation contribution, should reflect positively in the disposable income of retirees. Almost nine out of ten people aged 55+ intending to retire in the next 12 months (87.7%) have superannuation, one fifth have property investments (19.7%) and 6.1% have managed investments. This will lead to a continued trend of less reliance on government benefits in the years to come.”
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Roy Morgan Research is Australia's best known and longest established market research and public opinion survey company. Roy Morgan Single Source is thorough, accurate, and provides comprehensive, directly applicable information about current and future customers. It is unique in that it directs all the questions to each individual from a base survey sample of around 55,000 interviews in Australia and 15,000 interviews in New Zealand annually - the largest Single Source databases in the world. The questions asked relate to lifestyle and attitudes, media consumption habits (including TV, radio, newspapers, magazines, cinema, catalogues, pay TV and the Internet), brand and product usage, purchase intentions, retail visitations, service provider preferences, financial information and recreation and leisure activities. This lead product is supported by a nationally networked, consultancy-orientated market research capability.
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