The difference between a modest and comfortable retirement

 In Finances, Lifestyle, Retirement

Planning for retirement, from both a lifestyle and financial perspective should be part of everyone’s long term future and wealth creation process. I have seen clients that plan carefully well before retirement, generally become the most successful. Clients that defer putting into place a retirement plan until retirement becomes imminent may not leave enough time or scope to create the wealth required to fund ongoing income for the years that they do not choose to work.

Currently in Australia there are about five people of working age for every person above the age of 65. By 2031 it is estimated that there will be less than three people of working age for every person over the age of 65. This will put enormous strain on government revenues to fund the Age Pension. [2]

it’s not just about money. It’s also about what money can provide.

For example:

  • Trying new experiences for you and your partner
  • Spending more time with your grandchildren
  • Holidays so you can explore new countries
  • Great food and wine you can share with your friends.

Experience suggests that most people approaching retirement have little idea how much income or capital is required. The Association of Superannuation Funds of Australia (ASFA) provides numerous resources for the superannuation industry and general public.

One reference is the research on retirement living standards from April 2018. A modest retirement lifestyle is considered better than the Age Pension, but still only able to afford fairly basic activities.

A comfortable retirement lifestyle enables an older, healthy retiree to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of such things as; household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.

Table 1. below describes a modest standard of living in retirement – the estimated cost of this lifestyle is $39,353 per couple per annum, and $27,368 for single persons.

A comfortable standard of living in retirement – $60,264 per couple per annum and $42,764 for single persons. Both these standards of living assume that the retirees own their own home, aged between 65 and 85 years.

Table 1: Modest and Comfortable Budget Standard estimates for older Australians, $ per week, April 2018 [1]

Planning your approach to retirement can make a big difference. If your retirement finances are on track you’ll have much more flexibility when it comes to your post-retirement choices.
People that are planning to retire should first ensure their basic income needs are covered and then also generate discretionary income to allow for a comfortable retirement.

Whatever aspect of retirement you want to talk about, we can help you find the answer. Make the plan to come a visit us to have a conservation about your retirement planning ideas. We may be able to help and guide you through your retirement objectives to give you a certain quality of life in your retirement years.


Written by Peter Hawker, Senior Financial Planner on behalf of Oak Financial Planning.

Peter has been in the financial planning industry for eight years. He has studied a Bachelor of Management, Diploma of Financial Services (Financial Planning) and is SMSF qualified.

He also enjoys creating a comprehensive planning process for his clients. 

                               Peter is dedicated in helping all his clients keep on track during their financial planning journey.


[1] 2018 ASFA Retirement Standard Budgets Review; The Association of Superannuation Fund of Australia Limited; (Accessed on 20 June 2018).

[2] Australian Bureau of Statistics. 2017. 2071.0 – Census of Population and Housing: Reflecting Australia – Stories from the Census, 2016. (Accessed on 20 June 2018).


Oak Financial Planning Pty Ltd ABN 78 126 751 335, trading as Oak Financial Planning is an Authorised Representative and Credit Representative of AMP Financial Planning Pty Limited, Australian Financial Services Licence and Australian Credit Licence 232706.

This blog article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information.

If you decide to purchase or vary a financial product, Peter Hawker, Oak Financial Planning Pty Ltd and other companies within the AMP Group may receive fees and other benefits. The fees will be a dollar amount and/or a percentage of either the premium you pay or the value of your investment. Please contact us if you want more information.

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