Too poor to retire: More Australians than ever will work past 70
It has been reported that more Australians will intend to work beyond 70. This follows a government led superannuation (Australia’s version of CPF) reform in the coming Australian Budget.
The Australia Bureau of Statistics (ABS) show that the number of over-45s who say they will not retire before turning 70 has dramatically increased: from 8% to 23% in just one decade.
This sparks fresh concerns that a comfortable retirement is now “out of reach for hundreds of thousands of low-income earners.
Seniors groups say that the statistics reveal people ageing healthier and intend to keep working. However, it also tells of deep “financial uncertainty” among older workers following a series of superannuation and pension changes.
According to the ABS, financial security was cited as a top concern when making decisions on retirement. Next is personal health and physical abilities.
United Voice – the union representing some of the country’s lowest-paid workforces – said the findings were an indictment on former prime minister Tony Abbott’s decision to freeze an increase to employer super contributions, which had been scheduled to reach 12 per cent by 2019.
“This was incredibly cruel and short-sighted and will have a devastating impact on workers,” union state secretary Jess Walsh said.
“It is no surprise that more and more people are delaying their retirement.”
Ms Walsh said the pension was clearly “not keeping up” and Australians were finding it harder to accumulate enough superannuation to top up the pension to a reasonable level.
She said the value of the minimum wage had gone backwards nearly 10 per cent in two decades, making it even harder to accumulate enough superannuation.
“Our members work hard, they pay their taxes, and yet they can’t afford to retire with dignity.”
National Seniors chief executive Michael O’Neill said the new statistics revealed the “longevity penny has dropped” for people in their 50s and 60s, who were worried they won’t have enough money to fund a long retirement.
“People are saying, ‘I thought I was going to live until about 75, but now it looks like I could be living a lot longer than that … can I afford it?” Mr O’Neill said.
“Longevity has started to become a real issue.”
Mr O’Neill called on the federal government to provide “much greater clarity” about retirement income, including superannuation and the pension.
“People need certainty about what benefits will flow over time … and all the speculation around superannuation causes people uncertainty because they don’t know where it is going to land,” he said.
“And the government needs to stop talking down older Australians, and instead celebrate the fact that they are significant contributors and want to work longer.”