Boomers are delaying retirement because of the cost of living

- May 31, 2024 3 MIN READ
Australians are delaying retirement

More than a third of working Australians are planning on delaying retirement due to the rising cost of living.

The intergenerational war has never been more heated as the Baby Boomer generation are accused of everything from inflating house prices, increasing inflation and living a privileged lifestyle they supposedly don’t deserve.

And the accusers are their own adult children.

Just for a bit of perspective, 47 per cent of 55–64-year-olds still have a mortgage and 15 per cent of 65–74-year-olds… even 5.4 per cent of those over 75 have a mortgage. So oldies are also being hit by higher loan repayments.

Most Australians will work into their 70s

And this week Equip Super found only 26 per cent of Australian workers aim to retire at the age of 65. Those planning to retire later are delaying retirement by an average of six years, meaning many are choosing to work into their 70s.

More than a third of working Australians are planning on delaying retirement due to the rising cost of living. It illustrates the financial strain felt by households nationwide due to increased economic pressures and rising living costs.

The research also found that 85 per cent of Australians are becoming more cautious about their spending.

Maximise your super to stay on track

If you don’t want to keep working into your 70s, now is the time to maximise your super to support your ideal retirement age. There are four key things you need to do to stay on track.

1. Consolidate your accounts

Multiple accounts means multiple sets of fees eating away at your savings, so it’s crazy not to pool them together.

To figure out which of the super accounts you want to keep, hop onto the government’s Your Super website. You can compare your super accounts to see which one is giving you the best return. Don’t just check the super funds you’re currently a member of – you might end up finding a better option elsewhere and moving all of your super to the new account.

There’s currently $13.8 billion in lost super out there – if you think some of it could be yours, call the automated super search line on 13 28 65.

2. Nominate a beneficiary

If you pass away unexpectedly and haven’t nominated a beneficiary, your super fund will decide who gets your money.

This is because super is held in trust for you by the trustee of the super fund. It’s not covered as part of your will because wills only cover assets you own, like property, cars, investments and personal items.

To make sure that your super, and any life insurance you hold inside super, goes to the person you want, you need to nominate your beneficiaries. Take the time to lodge a beneficiary nomination form with your fund. Most funds let you do this online.

3. Review your insurance

Super funds often automatically provide new members with some combination of death, disablement and income protection insurance.

But this cover can be fairly basic and may not be suitable for your personal situation, so take the time to review it carefully.

  • Do you have enough cover?
  • And is it cost-effective for you to make the premium payments out of your superannuation?

You might find your better off holding your life or income protection insurance outside of your super.

4. Choose your investment option

Most super funds offer a choice of different investment options to cater for a range of investment strategies. To maximise your superannuation, you may need to move to a different investment option.

Think about what you want to achieve and how comfortable you are with risk, and invest accordingly.

Also keep in mind the time frame between now and when you’ll need to access your super. The risk you’re willing to take at age 30 will probably be very different to the risk you’re prepared to take on at 60 years. That’s one of the many reasons why you need to keep a close eye on your account if you want to maximise your superannuation when it comes time to retire.

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