Gen X don’t think they’ll be able to retire until they’re 72
Young Australians estimate they'll need between $1.5m and $1.74m in savings to retire.
In recent weeks there's been a lot of talk about the age that Australians will retire. Newly announced prime minister Scott Morrison revealed he would not be raising the retirement age from 67 to 70, much to the relief of Australian workers. However, new research released today by ING reveals generation X, those born roughly between the mid-1960s and 1980, don't think they'll be financially able to retire until they're 72 years old.
This is despite generation X wanting to retire at age 63. The following generation, known as gen Y or Millennials, don't think they'll be financially ready to retire until they're at least 68, despite wanting to retire slightly early at age 61.
ING's research also reveals that younger Australians are in no way underestimating the funds needed to retire comfortably. On average, generation X, Y and Z estimate they'll need between $1.5m and $1.74m in savings alone to be able to retire. This doesn't even include the value of any assets, like a property. And they shouldn't expect too much help from their parents either, with over 41% of baby boomers planning to spend their kids’ inheritance.
In comparison to these savings goals, the ASFA retirement standard for March 2018 estimates the lump sum needed to support a comfortable lifestyle for a single person in retirement is at least $545,000. Couples would need at least $640,000 saved in order to retire comfortably.
Head of retail banking at ING Melanie Evans said, “Gens X, Y and Z are clearly thinking cautiously about retirement and are under no illusion that you can retire whenever you want without adequate savings. However, there seems to be a reluctance to make plans, and this could be because they’re just not sure where they can go for help."
And although young Australians think they need up to $1.74m saved to retire comfortably, they don't have extravagant of overly-lavish retirement plans. The top two things Australians are aiming for in retirement is having enough money to live comfortably and not need to worry about a mortgage or rent.
If you want to start preparing for your retirement, take a look at our retirement hub which offers a bunch of resources to help you get your super sorted and save for retirement.