The incomes of people living on the Age Pension and renting are inadequate. The gap between their income and the cost of living is made up by debt and poverty.
At the end of last year, The Benevolent Society’s advocacy campaigner Joel Pringle was invited to contribute an article to the Retirement Affordability Index™, published by the team at YourLifeChoices. This issue of the index is a comprehensive ‘survival guide’ for 2019. It contains a wealth of information to help Australians prepare for retirement and make the most of their retirement savings.
In 2016, The Benevolent Society partnered with Per Capita and The Longevity Innovation Hub to explore the experiences of people living on the Age Pension in Australia. In his article, Joel shared some of the findings from their report, Adequacy of the Age Pension in Australia, and his insights into the outlook for 2019 for this ‘cash-strapped pensioner tribe’:
- The biggest indicator of poverty amongst older Australians is relying on the Age Pension whilst living in private rental accommodation. The single easiest way to address poverty experienced by older people would be to increase Commonwealth Rent Assistance by 50 per cent for single people and 30 per cent for couples.
- To keep up with these crippling costs, people relying on the Age Pension and renting are under spending on other essential goods and services. Only 16 per cent of people on the Age Pension who rent have health insurance, compared to 46 per cent of people who own their own homes. They are also under spending on other types of insurance, utilities, vehicle fuel and even food.
This shows that being stuck in private rent and on low incomes affects people’s entire well-being, including health and safety, and is a major concern.
- There is a serious issue with unequal access to council rate discounts or exemptions for people on the Age Pension in some regions. The financial capacity of councils in areas of disadvantage to provide this relief requires serious attention.
- While the current housing downturn and falling rents may bring some relief to people living in the highest cost rent areas, it is unlikely to increase the availability of affordable private rental properties for people relying on the Age Pension. Being in private rent will still be the biggest cause of financial distress for older Australians in 2019.
Advice for people living on the Age Pension
Joel shared two crucial pieces of advice for cash-strapped retirees:
1. Find out if you’re eligible for any additional government or other supports, and make sure you’re receiving them, such as:
- Rebates on medical supply costs for diabetes or incontinence, and energy rebates or low-income support from your telecommunications provider.
- Contact your local not-for-profit financial counselling service for information and support, or check out a program like MoneyMinded.
2. Join The Benevolent Society and our partners, National Seniors for the Fix Pension Poverty Campaign, in calling for better assistance for people struggling on the Age Pension.
Find out more at www.fixpensionpoverty.org.au.
You can read Joel’s full article on page 15 of the Retirement Affordability Index™.