The 2024 Challenger Retirement Happiness Index revealed a score of 70 for Australians over the age of 60, citing financial wellbeing as a primary determinant.
Namely, more than two-thirds of Australians over 60 would be “much happier” if they didn’t have to worry about finances in retirement, according to a new study.
Among the more than 1,000 Australians surveyed, 72 per cent said that they would be much happier if they had a guaranteed income for life in retirement, with over four in 10 (42 per cent) strongly agreeing in this regard.
However, education regarding financial options in retirement also emerged as a key factor influencing contentment, with 77 per cent of respondents indicating that this would have a positive impact on their happiness.
“Almost half of respondents identify financial security as an area they wish to improve, highlighting the work we must do as an industry to safeguard retirees’ golden years and foster a better, happier retirement,” commented Mandy Mannix, Challenger chief executive, customer.
“Reassuringly retirees felt their happiness would improve with access to the right financial education, as well as support through financial advice and a regular income to enjoy a safe, stable retirement. This would empower retirees with the confidence to spend and capacity to pursue their passions.”
Notably, unadvised Australians were more likely to report cost of living as having a significant impact on their financial security (39 per cent) compared to those who have received financial advice (25 per cent).
Nonetheless, rising cost of living and affordability remained a growing concern among both groups. Two-thirds of Australians over 60 indicated it impacted their confidence in having enough money for retirement.
Previously, State Street Advisors’ Global Retirement Report in January produced similar findings, observing that “many of the measures of confidence appeared to have weakened rather than strengthened” despite a dramatic reversal in markets in 2023.
Among the top factors affecting Australians’ retirement decision were inflation and cost of living (73 per cent), while 50 per cent of respondents weren’t confident they would be able to retire when they planned to.
However, according to Challenger, running out of money in retirement is gaining traction as a primary concern for older Australians, only losing out to physical health/fitness and losing mental sharpness.
Unmarried Australians were more likely than their married counterparts to rank not having enough money to do what they want to do as a top three concern they have about getting older.
“We know the fear of outliving savings is a growing concern among older Australians,” Mannix noted.
“Providing retirees with the confidence to convert their retirement savings into a regular income can materially improve their quality of life, supporting better retirement outcomes as well as benefiting broader society and the Australian economy.”
