Why many Australian retirees fear for the future

Why many Australian retirees fear for the future, by Robert Gottliebsen.

A great many retirees are now cutting back and some cruise operators in the up-market areas are reporting a 25 to 30 per cent fall in advance bookings and unheard-of cancellation rates, despite the consequent deposit losses.

Retailers in that sector will also notice the difference. Centrelink pensioners and those enjoying bonanza public service pensions are not affected. It’s those who sacrificed their living standards in past years to put money away for retirement that the politicians are targeting.

Among the self-funded retirees the most deep-seated anger is directed towards the Coalition, which retrospectively savaged retirement planning and broke all the previously established rules of government.

It’s not what the self-funded retirement community expected from the conservative forces in the government.

Having said that, they have adapted, which is why they are travelling overseas. Some are running down their retirement savings to greatly increase their dependence on the government pension. They hate doing it but we have a government that thinks little about the long-term implications of what it did.

Had the ALP said they would make no further changes, the retirement community might have supported them in droves.

Instead the ALP decided that if it was good enough for the Coalition to kick the sector it should join the party, so launched an all-out assault on self-managed fund funds in pension mode with assets roughly between around $400,000 and $800,000, reserving a special kick for retiring small entrepreneurs.

Shadow treasurer Chris Bowen believes there are big sums to be harvested but I don’t think he understands the retirement community and in my view he is simply wrong.

Indeed an angry retirement community is already carefully planning strategies to make sure the ALP does not harvest their franking entitlements. …

The Reserve Bank has lowered official interest rates to help young people, leaving the elderly relying on bank deposits for income to suffer.