Australians adjust retirement expectations as cost
of living pressure impacts confidence

• Fewer retirees say they can live comfortably, with cost of living the biggest concern
• Most Australians over 50 cannot see themselves achieving a comfortable retirement 
• One in four retirees are using their pension to pay down debt
• Australians who have received financial advice are significantly more likely to say they are on track to achieve their retirement goals

Monday 24 February 2025

A new report from Colonial First State (CFS) has found that retirees feel less financially comfortable than they were a year ago, while those approaching retirement are losing confidence amid ongoing cost-of-living pressures. 

The annual CFS Rethinking Retirement report found that 64% of retirees said they are currently able to enjoy a comfortable retirement, down from 71% a year ago. 

Among those yet to retire, over half of Australians (54%) cannot see themselves achieving a comfortable retirement, with this increasing to 57% for those over 50 years of age.

Based on a national survey of 2,250 Australians, the report identified the cost of living as the number one concern. More than three-quarters of retirees say their pension payments are being absorbed by essential living costs such as groceries and utilities. 

As a result, Australians have adjusted their retirement expectations in the last 12 months with a more modest outlook. Maintaining their current lifestyle and affording basic needs rated as the number one retirement goal.

Despite a desire to retire debt free, close to one in four retirees (22%) are servicing debt with pension payments, with this figure jumping to almost one third (30%) among those that do not own a home.

CFS Superannuation CEO Kelly Power said challenging economic conditions have prompted more Australians to reach out for help.

“The cost of living has shaken confidence in retirement expectations. However, it has also led to more people engaging with their super and seeking assistance with retirement planning,” said Ms Power.

The report found 41% of Australians have actively reviewed the performance of their super, up from 36% a year ago. Meanwhile, 28% have sought advice from their super fund, up from 23% last year. 

Australians who have received financial advice are significantly more likely to have a positive outlook on their financial situation, with 85% of advised Australians saying they are on track to reach their retirement goals compared to 47% of unadvised.

“The findings once again highlight the positive impact of financial advice, with those who receive advice twice as likely to feel financially prepared and on track to reach their retirement goals,” added Ms Power.

Given the positive correlation between receiving financial advice and retirement confidence, it is encouraging to see that a majority (70%) of Australians are interested in receiving information from their super fund on goal setting. Similarly, 72% of respondents said they would be happy to share their financial goals with their super fund.

Click here to download the full Rethinking Retirement report.