Australia’s baby boomers say the retirement system and pension needs work

It seems as though the government sometimes forgets that superannuation wasn’t compulsory until 1991 and many baby boomers don’t have

It seems as though the government sometimes forgets that superannuation wasn’t compulsory until 1991 and many baby boomers don’t have that huge nest egg that gets spoken about regularly. But now, a survey of over 4000 over-50s has proven this is a reality, and it needs to change.

Australia’s retirement system has been the source of much debate in the last year, and with the Budget just around the corner, Australia’s seniors are nervous for what their future holds. The pension doesn’t seem to be increasing, and there’s talk of asset tests and changes to super.

In a survey conducted by Your Life Choices, 60 per cent of respondents either agreed or strongly agreed that a family home, if valued above $2.5 million, should not be excluded from the pension eligibility assets test, reports SMH.

“Perhaps the most surprising result in the survey, and contrary to expectation, is that the family home is no longer considered sacrosanct when it comes to the age pension assets test,” publisher Kaye Fallick told Fairfax.

Surprisingly, there’s been support for changes to super – especially for high income earners. 2 out of 3 respondents believe reform of the superannuation system is required to reduce generous tax concessions.

“Older Australians are not averse to change nor overly protective of all retirement assets and tax advantages, as much current ‘generational warfare’ hype might lead us to believe,” Ms Fallick said.

Another interesting result from the survey showed big support for Labor’s policy of doubling the rate at which super contributions are taxed for those earning more than $250,000 a year.

But the main issue that was widely agreed upon was an overhaul of the entirely retirement system – 82 per cent agree that a review is necessary as the ageing population swells.
But Labor’s proposal to tax super earnings at a concessional rate for earnings above $75,000 in a year was not popular among respondents even though it would only really affect the wealthiest superannuants.

Tell us, how do you feel about Australia’s retirement system? What needs to change?

  1. Michael Leitch  

    If only some of our politicians showed a little empathy towards baby boomers we wouldn’t be needing this debate

  2. Mark  

    $2.5 million sounds a lot but sure as eggs it won’t be indexed. In the years to come this will be average house price. Would you like to lose your pension if you lived in a house valued at no more than average?

    • Fiona Mason  

      Mark, $2.5 is not a lot of money for a house if you live in some Sydney suburbs. There is no situation in which it is necessary to offer an aged pension as a loan against anyone’s home or force old people who are just hanging on for a few years before going into aged care to sell their homes to live. This is a suggestion from the Australian Business Council that Your Life Choices disgracefully ran with. To rundown people resources early in their retirement will place an unsustainable burden on aged care that is not adequately funded now. We have an appalling attitude to old people in Australia and it is disappointing to see people who should know better going along with the notion that it is ever OK to force the old and frail out of their homes. We have really become a morally bankrupt country.

  3. Lillian Wallace  

    As your article states Super didnt start until 1991 and small business wasnt taken into account,as a small business operator my late husband and I couldnt afford Super,the rules got changed constantly so we didnt go into Super.Four years ago my husband passed away and if we hadnt had the old Pension Bonus Plan we wouldnt have survived his illnes which affected our business.Because the bank didnt support us I lost my home and now at 72 have to rent and am told I cant get a loan because I am too old and close date is 75 years for a loan.So how canpeople on the pendsion get out of the rent rut if they want to.The only way I could own a home again is if I win Lotto and after all the years as a small business operator paying tax etc it has become a joke

  4. Hels  

    I w orked in a low paying job(NSW Govt). never asked the Govt to help me raise four kids on my own. When women were allowed to partake in Super I put in the most I could afford which was the lowest amount of 6%. I was medically retired in 19 98 and now live on the pension
    It was not my fault that I couldn’t save anything to help me now. But I am proud of my children because even with having to be latch key kids, none of them had a police record, none of them were pregnant till married. They have all been in a job and paying super since they left school. That’s the one thing I have made sure of, so they won’t have such a hard life as me.

  5. Fiona Mason  

    It would seem that the people Kaye Fallick said are open to including the family home in the assets test are actually only open to including other people’s homes in the assets test if you check the YLC website. No one wants their own home included in an assets test and it should not be. Australians in their late 70s plus should not be forced out of their homes to receive a basic pension. Australia is the only country in the world as far as I can find out that does not pay a contributory aged pension. All European Countries, The US, New Zealand, South and Latin American Countries, Canada and all the African and Asian Countries I have checked have one. We are more backward that North Korea, South Korea, China, Outer Mongolia, South Sudan and India in that respect, to cite just a few examples, as they all have universal aged pensions.
    In 1946 a 7.5% tax was introduced in Australia to provide a universal contributory aged pension and is still collected. Mr. Menzies, who agreed to the setting up of the contributory pension levy with the Labor Government of the day, stated that the Compulsory Contribution levy would remove the stigma of charity from the Age Pension. It would be an entitlement earned by the person’s personal contribution to the fund.
    The Government has since purloined the proceeds of that contribution mainly for the building of New Parliament house and recent Governments confabulate it with the extension of superannuation, introduced in 1993. This system was set up to give some superannuation to people who did not have any. In all countries superannuation is additional and separate to the aged pension
    Australia spends a lower portion of GDP, 2.9%, on pensions and aged care than any western country. Enormous cuts have been made to retirees’ incomes and aged care in the past three Budgets to provide tax cuts for business and higher income earners.
    We need to insist on having a proper retirement system not just for present retirees but for the generations to come and not accept the appalling statement of Scott Morrison that the pension is welfare.
    It is of grave concern that the seriously flawed survey quoted, which used push polling to get a positive response to the inclusion of the family home, is the first thing this cited in this report. I wonder what the purpose of this website is. It is not helpful to retirees to have people with no understanding of retirement or no empathy for older people trying to make money out of them by running sponsored discussion pages or worse still representing groups like the AIB lobby that have denigrated seniors and used all kinds of perverse arguments in the past two years aimed at pushing pensioners out of their homes and cutting pensions.

  6. [email protected]  

    Be that as it may. Have or have not.

    Taxes have always been paid according to present income (businesses aside)
    All pay them over a fixed minimum figure.

    Pension schemes. here and elsewhere.
    were implemented to cover the “lower working class,” that had no wherewithall to accumulate any reserves.
    Wage scales. costs of living etc.

    A person who owns a $600k up hose. is NOT needing.
    they have the assets there, to use if necessary. NOT to keep and others do without to give them a “Pension” part or part thereof.
    You do NOT need a house of that value/size etc. if you going to live off the country. and others around you who have nothing.
    You got there. make sure YOU have enough on top of to cover your lifestyle.
    or do same as everybody else. downsize to suit YOUR income/savings level..
    NOT your wants.

    I worked. and paid taxes in UK for 16 yrs and get part pension from there monthly (pre paid)
    I also worked rest of time here. now collecting pension accordingly on top of.
    UK Pension is mine. BY RIGHT. PREPAID for. Aust pension is according to politicians whims.

    We only have each other to blame, for allowing it. and not voting out/in. the party that would do so.

    People are sheep.
    Look at those idiots voting for Labor. after their past record over decades…..Every country they get their hands on
    goes immediately into debt. Controlled by the unions..
    I’ve lived in 5 country’s. they all went through a labor cycle. they all ended up in debt.

    NOBODY can survive and prosper by borrowing. Man or country.
    Me. I don’t even own a credit card and have not borrowed for anything,
    house cars yachts or caravans for over 50 yrs.
    Don’t even have a credit rating.

    I have no debt. and live comfortably. at my choice of level. on the pension…
    With a and tinnie. all mine and paid for.

    The levels of pension entitlements SHOULD be based on what YOU have in total.
    and a lot less than what it is.
    It’s for the “never had a chance to haves” . NOT the users……
    Pension should be raised to a decent minimum. Less spent overseas.
    MORE inside Australia.
    and people with assetts made to use them more fairly. Not hang on to because it’s nice to live in such.
    on somebody elses money.

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