Aussie seniors stressed about the cost of living impacting their super, new research finds

Senior thinking about her budget and the cost of living.

Retirement approaches quickly for some, which makes the rising cost of living a particular worry for those laying down future plans. Indeed, a new survey from Australian Seniors reveals 9 in 10 participants over fifty expect inflation to continue in 2023 – and are deeply concerned about how it could affect their super

Superannuation returns can fluctuate with the market, which usually means we don’t have to panic about short-term super losses. However, for people with a pressing need for retirement funds, a downturn can be a much bigger deal. 

To combat the budget squeeze, surveyed Aussies have either done or considered the following:

  • Reducing everyday spending (73%)
  • Increasing work hours (18%)
  • Putting off retirement (18%)
  • Creating other sources of income (10%).

Only a slim percentage of respondents (4%) suggested they have or would reduce their voluntary super contributions.

Recession could worsen super gap

Three golden oldies laughing while dying inside about the fact that somehow there's still a super gender gap.

Many of the aforementioned tactics are common go-tos for safeguarding finances during a recession, rumours of which have abounded for the last few months. 

In fact, Australian Seniors reports that a recession could worsen the already egregious gender super gap, with 88% of women and 75% of men over fifty reporting that a dip could seriously impact their superannuation savings. 

A recession is just one of many life events that can negatively affect your super balance, such as switching careers, changing salaries, caring for children, and divorce – many of which disproportionately affect women. 

“Being a passive financial participant is not a luxury women have, and even more so with the recession looming, women should be taking more control of their positions,” explains senior financial advisor at Wealth Designers, Dawn Thomas. 

Thomas suggests the following strategies for building up your financial security ahead of retirement:

  • Get clear on your retirement goals. While planning for the next thirty to forty years can seem daunting, it’s vital to make decisions now about how you plan to financially tackle them. No life event is too small to be overlooked, from weddings to new cars to travel. 
  • Pay attention to your super. Thomas recommends getting engaged with what’s actually happening with your super: how your returns have been performing, how your fees stack up, and if everything’s in the same place. 
  • Get on top of your household budget. Knowing which expenses are eating into your balance sheet can make a huge difference. Consider downloading a budget app to help do some of the cost-crunching for you. 
  • Make voluntary contributions. Depending on your circumstances, topping up your super fund can be an effective way to grow your nest egg. 
  • Hire a financial advisor. Finally, get some professional eyes on your finances. The right advisor will help you with custom insight, advice, and workarounds that work for your specific situation. 

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