RETIREMENT IS FACING EXTINCTION
Australia is facing the extinction an iconic species – the silver nomad.
Migrating from town to town with caravans in tow, the silver nomad was prolific across the entire country, but particularly near the coast.
But, with the future looking shaky, it’s unclear how long until their conditions for survival disappear.
We expect to see less and less silver nomads roaming across the sunburnt country – under threat by the scourge of two new species: the perpetual provider and the dreary destitute.
“WORK TILL YOU DROP”
But, seriously though … it seems like retirement may be becoming a thing of the past.
More and more older Australians are realising that Peter Costello’s famous advice to “Work till you drop” is will be the new reality for many Australians.
It is quite a blow for many who are now reaching retirement age.
WHEN SUPER, IS ANYTHING BUT
In an attempt to stall the devastation of an aging population, compulsory superannuation was introduced in 1992.
Now, 25 years later, the average amount of Super held by those nearing retirement is just a measly $155,000!
That’s about two years’ worth of average income – not enough to fund a happy retirement.
TRADITIONAL ‘RETIREMENT’ IS NOT SUSTAINABLE
Former Australian Treasurer, Peter Costello, thinks retirement is a thing of the past.
“I don’t think there will be a concept of retirement [in the future]. Retirement is a word from another age.”
He says, “We used to have five taxpayers for every person in retirement.”
“Soon, it’s going to be two – and we just can’t carry that.”
It’s no wonder then, that Costello told us to “work till you drop” when he was Federal Treasurer.
WHAT ARE OUT PROSPECTS OF RETIREMENT?
Costello says, when the aged pension was introduced in Australia, the retirement age was set at 65. The average life expectancy at the time was 55.
Nowadays, the average life expectancy is around 87.
Even though retirement age has increased to 67 for baby boomers – that’s still 20 years of retirement that the government never bargained for.
ENTER THE PERPETUAL PROVIDER
According to Costello, retirement is not a sustainable way forward for Australia.
There are currently around 3.5 million people in Australia over the age of 60 facing little or no prospect of retiring.
Many Aussies have had to forfeit their dreams of travelling in order to provide for themselves and their families well into old age.
THE DREARY DESTITUTE
But, not everyone can continue working past 65. Some people have had to stop working due to health problems or a lack of employment opportunities for the older age bracket.
If you find yourself paying private rent while on the aged pension, then you will be doing it tough.
If you also have health problems, you may find yourself living a future that would have seemed so improbable when you were a hard-working youth.
In 2016, OECD found that more than one third of Australian pensioners live below the poverty line.
With property prices rising and many young Aussies facing the possibility of never achieving home ownership, it seems all too likely that many hard workers will be left destitute in the later years of their lives.
Unless, they choose a different course.
TAKING MATTERS INTO YOUR OWN HANDS
It is time for us all to think about how we are going to spend the rest of our lives.
Will we be perpetual providers? The dreary destitute? Or, will we find our own way to build wealth and provide for ourselves and our family – so that we don’t have to work till we drop.
Some people may enjoy working, but many of us don’t want to spend our entire lives at a job that we don’t like.
Building an asset base that will keep on growing, whilst also paying an income stream, is an ideal way forward for Australians who don’t want retirement to become an outdated concept.
In fact, let’s build a new concept of retirement – one of self-sufficiency.
If we can look after ourselves in the twilight years, then the government will have better capacity to look after those who can’t provide for themselves due to health or circumstance – hopefully, giving them a better quality of life too!
How do you feel about your prospects of a tax payer funded retirement?