The latest ASFA Retirement Standard showed that couples aged around 65 now needed $73,077 per year to achieve a comfortable retirement, with $51,805 for singles, after both retiree budgets rose by 0.1 per cent in the December quarter. The budgets at the modest level of retirement were basically unchanged.

Higher costs for domestic holiday travel and accommodation and home and vehicle insurance added to the cost of retirement in the December quarter.

Retirees have made up some of the shortfall through strong investment returns gained last year. Balanced superannuation fund options showed a typical return of at least 10.5 per cent for calendar 2024, with some funds recording nearly 12 per cent, while returns for accounts in the retirement phase were even higher.

“While recent strong investment returns are helping retirees and those planning for retirement in achieving their desired retirement lifestyles, the most recent Retirement Standard budgets reinforce the fact that Australians need both compulsory superannuation and voluntary contributions which are preserved until retirement to have the sort of retirement they need and deserve,” Delahunty said.

Electricity prices fell 9.9 per cent in the December quarter and 25.2 per cent in the past 12 months, driven largely by the introduction of the 2024–25 Commonwealth Energy Bill Relief Fund (EBRF) rebates from July 2024.

Insurance cost rose 1.1 per cent – the weakest quarterly rise since the June 2022 quarter – thanks to easing reinsurance and replacement and repair costs contributing to a moderation in insurance premium price growth across house, home contents and motor vehicle insurance.

Pharmaceutical products fell 1.6 per cent due to an increase in the proportion of consumers who qualify for subsidies under the Pharmaceutical Benefits Scheme (PBS). Increased take-up of 60-day prescriptions also lowered the cost for some prescription medicines.