Aussies seek advice as inflation threatens retirement goals
Australia continues to rank strongly in the global retirement index, but with high inflation threatening their retirement goals, a third say they would get professional advice to improve their chances.
Natixis Investment Managers’ annual Global Retirement Index (GRI), created with CoreData, assesses factors that drive retirement security across 44 countries from over 7,000 individuals.
This is measured using 18 performance indicators across four thematic subindices: health, finances in retirement, quality of life, and material wellbeing.
It revealed that Australia ranked seventh for the third consecutive year, although it is down from fifth place in 2022, and also scored highly for health, material wellbeing, and finances in retirement. This marks a decade that Australia has featured in the top 10.
Norway held the top spot, displacing last year’s winner, which was Switzerland. A rising star this year was Slovenia, which entered the top 10 for the first time this year and has risen from lows of 21st position just three years ago.
“Australia tops life expectancy among high-income English-speaking nations, with investments in public health, preventive care, and lifestyle initiatives offering a model for improved longevity,” it said. “Inflation has eased, in part due to falling electricity costs from government subsidies and softening rents and home prices. But core inflation remains at the top end of the central bank’s target range.”
Investors’ five biggest retirement fears globally were that they won’t have enough money to enjoy retirement, inflation is impacting their retirement goals, they worry government benefits will be cut, they will be unable to save enough, and they will ‘go broke’ from healthcare costs.
Looking specifically at Australia, some 80 per cent said they were saving less for retirement as a result of grappling with higher costs for medicine, utilities, and groceries. This was significantly higher than the 66 per cent of investors globally.
A third of Australians said they would get professional advice to improve their chances at retirement.
“Many advisers bring investment expertise together with income optimisation and insight on the ins and outs of pension policies to provide individual support for clients. These unique capabilities are essential to developing the personalised retirement plan that individual investors see as the best step to ensuring retirement success,” it said.
Overall, almost half of individual investors globally (46 per cent) said it would take “a miracle” to achieve retirement security, and 25 per cent worry they will be unable to save a sufficient sum. Some 69 per cent said higher inflation has eroded the future value of their retirement savings.
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