Leisure items determine level of retiree comfort: ASFA

The costs for retirees living 'comfortably' and 'modestly' are largely affected by varying costs of leisure goods and services, according to new figures released for the ASFA Retirement Standard.

A couple looking to achieve a comfortable retirement will need to spend $55,080 annually, while those seeking a modest retirement will need to spend $31,643, according to ASFA.

ASFA said differences in costs for couples living comfortably and single females living modestly varied due to the cost for leisure goods and services.

The aggregate costs for a couple living comfortably in retirement decreased by 0.3 per cent in the March quarter from the December quarter 2011, however, costs for single females living at a modest level were down by only 0.1 per cent. 

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The prices of leisure goods and services fell by 2 per cent between the quarters, with the costs of overseas holidays falling by 4.8 per cent and domestic holidays by two per cent, particularly affecting retirees on comfortable budgets.

The movement in costs for retirees at the modest level was similar to the 0.1 increase in the All Groups Consumer Price Index for the quarter, said ASFA.

Retirees experienced their second consecutive month of steady costs in March, according to ASFA who reported costs mainly consisted of food, health, transportation and recreation spending, with few affected by cost increases for housing and education.

Costs of food for retirees decreased by 2.1 per cent between the December quarter 2011 and March quarter 2012, and 2.5 per cent over the year to the March quarter, which ASFA said was a result of a fall in the price of fruit.

Substantial price increases in electricity were recorded, along with marginal increases in transport and fuel costs - although these were partially offset by a decrease in the cost of motor vehicles.

While communication costs increased only slightly over the year, ASFA said health experienced a 4.2 per cent increase over the year, reflecting a decrease in retirees covered by the Pharmaceutical Benefits Scheme safety net.