Two years ago, National Seniors asked older Australians about their retirement income worries. Our researchers found the degree of worry about retirement income was:

• Sixty-eight per cent higher in those not already retired – previous research indicated that people adjust to their actual circumstances in retirement, whether they planned for them or not.
• Sixty-five per cent higher in those with less than $500,000 in savings – this is as expected since they may not have the money to pay for a ‘comfortable’ retirement.
• Fifty-three per cent higher in those who expect their primary source of income in retirement to be the age pension. 
• Four per cent higher in women – this is after taking out the effects of one or more of the previous three factors and may be associated, in part, with expecting greater involvement in caring roles and a real risk of outliving their partners.

Unfortunately, by the time we access our superannuation, it is too late to put in place actions that may have lessened those worries and made a significant difference to our retirement income. 

To help you prepare for retirement journey challenges, here are some common mistakes to avoid. 

Family and friends may have the best intentions, but they are unlikely to have expert knowledge of the complexities of superannuation, tax law and pension regulation to provide the best advice for your circumstances.

Seeking retirement advice from friends or family should not replace quality, objective, financial advice from an experienced and qualified adviser.  

It is natural to choose a more conservative approach to investment and move your money into defensive assets like bonds or cash.

Keeping your super diversified is a long-term investment strategy that helps to reduce risk without sacrificing returns. Also, think about ensuring your savings last for as long as possible. Being too conservative may mean your money runs out.

Most people retiring at age 65 can expect to live at least another twenty years.

Health declines with age, and medical and health care are expensive. You may have to adapt your home as your mobility decreases and pay for help in the home.

The Association of Superannuation Funds of Australia’s (ASFA) retirement income standard estimates that healthcare costs increase from 16 per cent of weekly expenditure for a 65–84-year-old couple enjoying a comfortable retirement to 21 per cent of weekly expenditure once they hit 85.

For those with a modest lifestyle, healthcare costs will rise from 12.5 per cent during early retirement to 17 per cent of the budget post-85. 

This is ok if you have the money to spare. But for pensioners, there are pension implications. If you are retired, giving away some of your financial assets may impact your lifestyle in the long run, and there are tax law implications on gifting. Before leaping in, talk to a qualified adviser.

Do not defer saving for retirement until you are almost retired—it can be costly. Those who put away little extra savings earlier can afford a better lifestyle in retirement.

Those who never get around to it or start saving later must work longer or become reliant upon government financial assistance.  

The average Australian male born in 2018–20 can expect to live to the age of 81.2 years, while females born at the same time can expect to live to 85.3 years.

A man aged 65 in 2018–20 can expect to live another 20.3 years, or until 85.3 years, while a woman aged 65 in 2018–20 can expect to live another 23 years, or until age 88.

That means most people retiring at age 65 can expect to live at least another twenty years. What many forget is that these numbers are averages; half of this group will live beyond age 85.

For example, the Australian Bureau of Statistics life expectancy tables shows that if a male did manage to make it to 85 years old in 2018–20, their life expectancy was 91.6 years. For women, aged 85 in 2018–20, the life expectancy was 92.7 years.

If you retire at 65, you may need your super and other retirement savings to last for more than thirty years. If do not want to live solely on the Age Pension, you need to put in place contingencies for your super to last if you do.