In January, theAustralian Bureau of Statistics published its latest Retirement and Retirement Intentions publication which relates to the period July 2006 to June 2007. The document has provided a few new insights while also continuing to remind that the majority of retirees (aged 45 or older) continue to rely on the Aged Pension as their major source of income.
The key findings were:
- For men the most commonly reported main source of income at retirement was a 'Government pension or allowance' (52%). The 2nd next major source was 'superannuation or annuities' (22%)
- For women the major source was from a partner's income (47%). The 2nd major source was from a 'Government pension or allowance' (33%)
- The main source of income during retirement changed with most people becoming reliant on a 'Government pension or allowance'
- However, more than half of those whose main source of income at retirement was from 'superannuation or annuities', 'dividends or interest' or 'rental income' continued to rely on them as their main source of income.
- 281,100 people previously retired had either re-joined the labour force or were planning to look for work. The most important reason was financial need (43%)
- The average intended retirement age for those aged 45 and over and still working was 63 years (64 for men, 62 for women) (Up slightly from 62 years in the 2004-05 report)
- 49% of those aged 45 and over who intended to retire in the future named 'superannuation or annuities' as their expected main source of income.
- The 2nd most commonly reported expected source of retirement income was from a 'Government pension or allowance' (22%)
My general conclusion from all of this is that people will expect / intend to rely less heavily on government pensions in the future. The question that has to be asked is whether people are properly planning for this?
My colleague, Scott Francis, has published an interesting article in Alan Kohler's Eureka report which looks at the rate at which superannuation assets can be drawn down in retirement - Tap your super, but how much?