It’s how much a single renter in Sydney will need at retirement, according to Association of Superannuation Funds of Australia (ASFA) CEO Dr Martin Fahy. For renting couples, it’s around $1,166,000.
This compares to $545,000 for a single person and $640,000 for a couple who own their own home, he told the Fin Review.
A single person renting privately in Sydney needs around $320,000 to support “a modest standard of living in retirement”, with a couple needing around $450,000.
Currently three-quarters of Australians aged over 65 own their own home, while eight per cent are paying off a mortgage and another eight per cent are renting privately.
But with housing prices increasingly out of reach for many, the number of renters is set to jump dramatically.
More Australians renters for life
There are around 425,000 people over 50 renting in Australia, rising to 600,000 by 2030 and 830,000 by 2050, according to the University of Swinburne.
The fact is most retirement policy is based on people owning their own home – and being able to use it to fund their aged care if they need to.
And you can’t rely on the Age Pension, which is currently $23,096 for a single person and $34,819 for couples – nowhere near the figures recommended by ASFA.
So what can you do if you do rent? As we reported here last week, retirement planning is key.
Get advice about increasing your super or setting up an annuity.
It could mean the difference between a ‘modest’ retirement – and one you can really enjoy.
