The latest statistics on superannuation balances shows women’s superannuation balances, on average, are 40% lower - the average super balance for women is $92,000 compared with $154,000 for men.
Why is this so? As I see it, the main reason why women accumulate less is because generally they take more time off from work to have children and some never return back to work, they are on lower average incomes and they mostly retire earlier.
So how much would a person need in retirement? The Association of Superannuation Funds of Australia (ASFA) keeps statistics on the retirement living costs and according to them a couple seeking a comfortable retirement lifestyle will need $55,249 per year. Their definition of “comfortable retirement styles” is: one that enables a healthy retiree to get involved in a broad range of leisure and recreation activities including domestic and occasional international travel
I have seen other statistics, which show this figure to be only $31,675 per year – my conclusion is that may be this estimate is for those wanting a “modest retirement” e.g. better than Age Pension, but still let's a retiree only afford fairly basic activities.
Unfortunately, for me both definitions may roll off your tongue, they don’t really reflect the reality of ongoing price increases. Just consider these 3 increases in the last 12 months:
- Over the 12 months food costs have increased by 2.5%.
- Electricity costs went up, on average, by 0.6%
- Health services increased by 3.6%. Interesting fact: statistically, over the longer term health services tend to have higher increases n prices than any other category of goods and services.
So can you live on those amounts yourself?
Let me tell you: RETIREMENT is a tough business. If you think you are struggling now while working just think about retirement and the fixed incomes waiting for you.
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