Over half of older Australians are worried they will outlive their savings, and two-thirds of retirees who have been retired five years expect to spend their savings over the next 20 years, according to the National Seniors Australia (NSA).
The NSA’s latest research, in partnership with Challenger, found of those worried of outliving their savings, women (59%) were more worried than men (47%).
People without any super reported the highest levels of worry, with 23% worrying frequently, the advocacy group said.
NSA chief executive, Professor John McCallum, said: “Australia has one of the best pension systems in the world, yet Australian retirees are still showing high levels of worry that they will outlive their savings.
“This shows a need for better advice and education to help older Australians manage their savings so they can have the confidence to spend their money and enjoy retirement.”
NSA noted that women were more worried than men due to the higher likelihood of relying on the age pension as their main source of income. Divorced women were among the most worried about their financial situation in retirement.
Challenger chair of retirement income, Jeremy Cooper, said while women on average lived three years longer than men, the super system did not cater for this difference in longevity.
“…[The] research clearly highlights is that people treat the age pension and their own savings differently. They fear running out of their own money, even though the safety net of the age pension will be there for them,” he said.
“This sends a strong signal that people worry about being solely reliant on the age pension. It’s therefore important that super funds explore ways of providing more lifetime income to their members.”
The research also found that having a reliable source income that would last for life was a key factor for worrying less, with those people with a defined benefit pension or a lifetime annuity reporting the lowest levels of worry.