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How much do I need to retire comfortably in 2020?

26 February 2020

Heartland takes a look at the latest retirement living standards set by The Association of Superannuation Funds of Australia (ASFA).

Your retirement lifestyle can be defined as either modest or comfortable. ASFA defines these as:

Modest lifestyle: A modest retirement lifestyle is considered better than the Age Pension, but still only able to afford fairly basic activities.

Comfortable lifestyle: A comfortable retirement lifestyle enables an older, healthy retiree to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of such things as: household goods; private health insurance; a reasonable car; good clothes; a range of electronic equipment; and domestic and occasionally international holiday travel.

The below tables from ASFA show the living standards for those aged around 65 and 85 for the December 2019 quarter.

Aged 65

Aged 85

The problem is these figures assume that you own your home outright, but research shows that currently 36% of homeowners are retiring with debt, up from the 23% it was 10 years ago. Retiring with debt means mortgage repayments take a significant portion out of retirement income, so those who have enough for a modest lifestyle may struggle with day to day expenses, and those who are able to live comfortably, may be living more moderately, because of this debt burden.

Some of the latest research from National Seniors Australia also shows that one in five participants frequently worry about outliving their savings and investments for retirement. This research clearly shows there is a need for better understanding of financial products that support retirement planning, such as our reverse mortgage.

A Heartland reverse mortgage can be the perfect solution for some, restoring peace of mind while giving you the freedom to live your retirement the way you choose. Our Heartland Reverse Mortgage Calculator can show you how much you might be able to borrow.

If you would like to find out more about how a reverse mortgage could help you, request our free Information Pack or have a chat to our Customer Care Team on 1300 889 338, we can even arrange for an Accredited Broker to meet you face to face if this is what you would prefer.

Information provided is accurate as at 18 February 2020 and may change from time to time.