Too many Australians guessing about retirement finances

Senior couple planning their investments, getting financial advice in living room

Image: Wavebreak Media Ltd/

More than three-quarters of 45 to 64-year-old Australians are ‘running blind’ concerning their retirement finances; half base their understanding of the amount of money they will need in retirement on a ‘total guess’, and a third rely on family members for their financial advice.

Further, ‘They’re neglecting to get advice, [are] not proactive about planning and a good majority have no idea about the recent government changes,’ said David Bryant, CEO of Australian Unity Wealth about the findings of the Australian Unity Empirica Retirement Planning Research study (PDF).

The research found a heavy reliance by baby boomers on superannuation as their financial solution for retirement, but an ‘alarming number’ have insufficient funds put aside. This is complicated by little knowledge of recent government changes and less awareness of the impact the changes will have on their retirement.

‘What’s clear is that many baby boomers—though reliant on super for their retirement, don’t understand it, and don’t have a plan for their retirement beyond it,’ said Bryant.

What the report revealed

In part, the report also found that:

  • Nearly half of all retirees and those headed for retirement have no investments outside of super
  • Approximately one-in-ten workers over the age of 60 do not know how much they have in super
  • More than 60 per cent of those surveyed were ‘confused’ or completely unaware of the government’s super reforms and what they mean for them
  • Though they don’t have a good understanding of the super changes, more than half the pre-retirees believe they’ll have to work longer and retire later than planned because of them
  • Only 1 per cent of retirees and pre-retirees say they feel ‘well informed from the government and prepared for the changes’
  • Half of all retirees and pre-retirees do not believe they are using the best investment products and strategies to achieve their retirement goals

Lack of financial advice

As mentioned, the survey results show that more than a third of baby boomers rely on family members for their financial advice and nearly 50 per cent say their understanding of the amount of money they believe they need to retire on is based on ‘a total guess’. Only slightly more than 10 per cent regularly meet with a financial advisor.

‘With all due respect to family members, baby boomers are doing their retirements a significant disservice by relying on family members for advice instead of professional advisors’ said Steve Davis, CEO of Australian Unity’s Personal Financial Services business.

In contrast to the uncertainty revealed by the survey, he adds, ‘Surveys of our own clients consistently indicate that they feel better informed and more optimistic about their current and future financial situation and outlook than non-advised clients do.’

Besides, it’s better to know the reality of your financial position than not—even if the news is bad. At least you know what you’re working with.

There’s good news

Bryant adds the good news: ‘Someone five to ten years off retirement still has time to make the right decisions now to put in place steps to help ensure they are preparing for their future.’

If you haven’t done so yet, now is the time to act. Not sure what to do? Start here.

Bruce Manners: the author of Retirement Ready?, Refusing to Retire, and founder of


Category: Finances, Planning

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