Australians are underestimating by up to 20 per cent the amount of money they’ll need in retirement, according to a new survey from an international investment manager.
The responses, collected from active Australian investors*, reveal a mismatch between the income people believe they need in retirement and the actual cost of living. Non-retired Australians expect living expenses will take up just 39 per cent of their retirement income, in reality it accounts for 58 per cent of expenditure, a gap of almost 20 per cent.
This stands in stark contrast to our Asian neighbours who were on point with their expectations of living expenses. Non-retired people in the region on average estimated they needed 32 per cent while retirees report actually needing 38 per cent.