Women worse off when they retire
The poorest quarters of the Australian community remain dependent on the age pension after retirement, with single women worst off, according to an Actuaries Institute report.
Entitled For Richer, For Poorer, the report found the Age Pension constituted 93 per cent of retirement income for people with low income and 44 per cent for “middle Australia”, demonstrating that there is a strong reliance on the age pension for half the population.
“Single women are likely to experience the worst outcome in retirement compared to couples and single men, with many unable to achieve a comfortable standard of living,” the report also found.
The report indicated that super will fund a larger proportion of retirement incomes in the future, but the reduced cost to the government will be offset by an ageing population who are living longer.
“While the super system is working well generally, it will not deliver comfortable retirements for all groups,” said David Bell, Chief Executive Officer of Actuaries Institute.
“We think there’s a risk that the Middle Australia of the future will have to pay higher taxes to fund current and future retirees — which in turn reduces their capacity to pay for their own retirement, and it’s likely that the growth in property values experienced by current retirees won’t apply to them.”
The Institute's president, Estelle Pearson, added: “To have an informed debate that leads to a fair and sustainable pension system, policymakers need to have a much clearer overall picture of the financial position of all Australians in retirement.”
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