New data shows that nearly one in five Australians think they will not be able to retire without government assistance.
According to Mortgage Choice’s Australian Financial Savviness Whitepaper, almost 20 per cent of Australians believe they will have to rely on government assistance if they retire at 65.
The continued rise of the cost of living is being blamed for blocking many Australians from effectively saving enough money to fund a comfortable retirement. Expenses rise and wage growth stagnates, leaving Australians to make the same amount of money go further.
According to the latest data from the Australian Bureau of Statistics, Australian wages grew by two per cent between the September 2016 quarter and the September 2017 quarter. Flavell said that despite the stagnation in wage growth and the rise in the cost of living, those who are most optimistic about their retirement savings were under the age of 30.
According to the Whitepaper 44.8 per cent of those under the age of 30 are confident that they could live lavish or comfortable lives in retirement. Only 26 per cent of those between the ages of 40 and 49 said they would live comfortably in retirement, while the remainder believed their lifestyle would be modest and require assistance from the government.
Gen Y are confident in their ability to save for their future and enjoy a comfortable retirement, but most Australians don’t share the same level of optimism.