Plan for a retirement not just an Age Pension 

The Age Pension is designed to be a safety net provided by the government to support those who aren’t able to support their retirement years alone. 

Female sitting in garden

Whilst this isn’t meant to be relied on as a person’s main source of income, around 50% of retirees currently do [1]. One of the reasons why this might be the case, is a lack of planning ahead when it comes to our retirement years.

In truth, the Age Pension should be viewed as one aspect of your overall retirement plan, not its entirety. A recent survey by the ASX revealed that while 50% of people surveyed believed that saving for a holiday was their number one financial goal, only 12% said that their goal was to plan for retirement [2]. 

Why aren’t we planning properly for our golden years?

There are a lot of reasons why we haven’t always planned ahead for our retirement. One of the bigger ones is that superannuation has only been compulsory since 1992, so a large proportion of the current retiree population may not have had super for much, if any, of their working lives. 

Additionally, superannuation may not be enough to support a person in retirement alone. According to ASFA  the average man retires with $270,710 in their super, whilst the average woman retires with just $157,050 [3]. ASFA also says that the lump sum needed to support a comfortable lifestyle is $640,000 for a couple and $545,000 for a single.

Thirdly, there is a proportion of retirees in Australia who have been forced into retirement early due to illness or injury, where they are often in limbo until they reach Age Pension age. The report on the Retirement income review revealed that around 28% of retirees are in this position [4]. The report also suggests that those who don’t own their own home and are paying rent in retirement are also disadvantaged. This can be either due to higher financial stress or a lower pension (the principal family home isn’t included in the means test, but savings and assets are) [5].

What can you do?

It’s not a bad thing to include the Age Pension in your retirement plan. But we think it should really only make up one element of your plan. The best thing you can do is build a strategy to ensure your money works hard for you in retirement.

Need help managing your retirement income?

TelstraSuper Financial Planning can help you understand what your pension entitlements are together with advice about your super.

They can sit down with you to develop a plan and help you with things like:

  • reviewing your retirement goals and your income stream
  • establishing a budget for retirement
  • maximising your government entitlements
  • contribution strategies and maximising your savings if you’re still working
  • reviewing your investment strategy

If you’d like to speak to a Financial Adviser from TelstraSuper Financial Planning call 1300 033 166 or you can request a call back online.


1. https://www.moneymag.com.au/pension-not-a-retirement-plan
2. https://www.moneymag.com.au/pension-not-a-retirement-plan
3. ASFA, Superannuation account balances by age and gender, ASFA Retirement Standard, September 2020
4. https://treasury.gov.au/sites/default/files/2021-02/p2020-100554-udcomplete-report.docx
5. https://www.theguardian.com/australia-news/2020/nov/21/bet-your-house-on-it-three-things-to-know-from-australias-retirement-income-review