Lifestyle status check
What type of lifestyle do you want when you retire?
The type of lifestyle you’ll be able to lead once you retire will depend on your budget and how much money you will have available to spend.
Modest lifestyle
A 'modest lifestyle' includes the basics but very little else. For example, both eating out and entertaining at home will be restricted and no overseas travel is possible.
The extra expenditure associated with a shift from a modest lifestyle to a comfortable lifestyle in retirement adds a lot to enjoyment, comfort, style, holiday travel, health insurance cover, and the ability to more fully participate in modern Australian society.
At the modest level, many retirees would not be able to participate in a range of sport and social activities that involve out-of-pocket expenses of various sorts.
Comfortable lifestyle
A 'comfortable lifestyle' includes entertaining at home on a fortnightly basis, seven glasses of wine (or equivalent refreshment) a week and eating out three times a week at a club/restaurant or once a week at a more expensive restaurant.
It also includes approx. $40 a week or so per person for expenditure on items such as drinks at the club, some gambling on lottery tickets or the like, tobacco purchases (if a smoker) as well as the purchase of magazines, compact discs and DVDs allowing greater enjoyment of printed material, music and movies.
Your retirement lifestyle
The following table is based on research conducted by ASFA and Westpac in August 2004 and updated in December 2008 which assessed the amount of income required to meet a retired couple's needs, for both a modest and a comfortable retirement, in the major capital cities.
Income requirements for a couple
| |
Modest lifestyle |
Comfortable lifestyle |
| Annual expenditure |
$27,366 pa per couple($1,052.54 per fortnight) |
$50,414 pa per couple ($1,939 per fortnight) |
| Government Age Pension |
$24,746.80 pa per couple($951.80 per fortnight) |
|
To have a comfortable lifestyle, research shows that retired couples need an income of around $50,414 per year. This assumes that the retired couple owns their home.
The modest lifestyle requires an income of $27,366 pa per couple.
In comparison, the Government Age Pension pays couples only $24,746.80 pa and a single person $14,814.80 pa. Additional payments and supplements are also available if you qualify as an age pensioner.
Is this enough to provide you with the type of retirement you have been dreaming about?
