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Younger Australians think they’ll need $1.74m to retire

Published on 11/09/2018
ING research reveals Gens X, Y and Z are resigned to working longer than what they want to

Tuesday 11 September: New cross-generational research by ING reveals, on average, Gens X, Y and Z think they’ll need between $1.5m and $1.74m[1] each in savings (excluding assets) to retire. This is more than double the ASFA recommendation for a standard couple that own their home.

Gen X don’t think they’ll be financially ready to retire until they’re 72, despite wanting to retire at 63. For Gen Y they’d like to retire at 61 but don’t think they’ll have the funds to do so until they’re 68. Gen Z is more optimistic, wanting to retire at 62 and being ready at 65.

Less than half of Gen X say making a plan for retirement is something that’s on their radar, while high proportions of Gen Y (64%) and Gen Z (79%) admit to not having a retirement plan on their to do list.

Melanie Evans, ING’s head of retail banking says:

“Gens X, Y and Z are clearly thinking cautiously about retirement and are under no illusion that you can retire whenever you want without adequate savings.

“However, there seems to be a reluctance to make plans, and this could be because they’re just not sure where they can go for help.”

The research found more than a third (35%) of Gens X, Y and Z that are concerned about not having enough to retire just don’t know where to start and some (25%) are choosing to stick their heads in the sand and hope for the best.

The research shows that on average, Aussies generally become serious about planning for their retirement at 45.

What does a happy retirement look like?

Having enough money to live comfortably and not having to worry about a mortgage or rent are the two top things that will make for a happy retirement, across the generations. Regular holidays and being able go out for a nice meal whenever you want also score highly.

More than 45% of respondents say that being able to work casually, when it suits them would make them happy. This was particularly the case for Gen Z with more than 60% of respondents saying so.

“For Aussies it’s the simple things that will make us happy in retirement – having enough money to live well and home security. We’re also a nation that’s not prepared to completely stop work with many choosing to continue some sort of casual work throughout retirement.”

Boomers most likely generation to spend kids’ inheritance

Over 41% of all Baby Boomer respondents say they plan to spend their kids’ inheritance.  While only 28% of Gen X, 31% of Gen Y and 14% of Gen Z say the same.

“Baby Boomers that say they will leave an inheritance for their children might want to also leave some financial guidance as 76% of Gens X, Y and Z say they don’t feel confident about managing an inheritance.”

Notes to editor

Research was conducted in July 2018 by Rice Warner with more than 2000 participants aged 16 to 64.

For more information or a copy of the report please contact:

Megan Landauro

Megan.landauro@ing.com.au/ 0413 317 225.

David Breen

David.Breen@ing.com.au/ 0412 933 060

[1] Respondents were asked to select a range of savings they require for retirement. The midpoint of each range was subsequently utilised to derive the average savings required for each generation.

Media Enquiries

media@ing.com.au

David Breen
Head of Corporate Affairs
0412 933 060

Megan Landauro
Public Relations Manager
0413 317 225

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