What I’m learning

Those who follow my writing know that most of it concentrates on retirement income and ways to explain the complexities of creating retirement income streams to the vast bulk of so-called ordinary Australians who don’t have a financial planner. No, I’m not an adviser – far from it – but I do understand most of the rules and take great delight in explaining them in plain English to people who struggle with the bureaucratic detail which usually strangles access to superannuation and Age Pension entitlements.

I also work with Matt Grudnoff from The Australia Institute to keep a tab on the real costs of living in retirement – and not the overly robust projections parlayed around by some in the media, to the detriment of people trying to make ends meet. We’ve been producing the Retirement Affordability Index for eight years now. We believe it is the most accurate measurement of actual spending in retirement. It’s not ‘aspirational’ which is code for what you might like to have in retirement. Instead it recognises the six main ‘tribes’ and how much they actually need to fund their later lives. These tribes include homeowners who are mainly self-supporting, homeowners fully or partly funded by an Age Pension entitlement and those on an Age Pension. Here’s a breakdown of current retiree expenditure, based upon ABS data and updated in line with the CPI changes.