Why Some Retirees Could Require an Additional $300k in Savings

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Renters starting their retirement will need an extra $300,000 in superannuation to maintain the same retirement standard as those who own a house, according to a new analysis by Super Consumers Australia (SCA).

The superannuation advocate group has found that a single retiree who rents will need $659,000 in superannuation if they want to enjoy the same living standard as those who own a home and have $322,000 in super.

An analysis from SCA earlier this month found that if a single Australian who has just started their retirement wants to keep their spending level at $1,690 per fortnight, they will need to have at least $322,000 in super by the time they turn 65.

The group then swapped the spending of homeowners on their house — such as maintenance — with rental costs for renters, to calculate the savings they will need.

According to a recent analysis by SCA, renting during retirement significantly increases living costs, with renters needing to allocate 30 to 47 percent more finances compared to homeowners to maintain an equivalent lifestyle.

SCA deputy CEO Katrina Ellis, who authored the report, says the $300,000 gap reflects how much more it costs for a renter when they are retired compared to a homeowner.

She says this has become “an impossible financial problem” for renters to solve.

“We know that home ownership is getting less and less across Australia, so there will be more people reaching retirement who are renting,” she told SBS News.

The study further reveals that a retired couple who rents will require $786,000 in superannuation to enjoy a comfortable retirement, whereas a couple owning their home would only need $432,000.

York has urged government intervention by implementing “targeted strategies” to aid female retirees who rent, alongside advocating for the construction of more public and community housing.

Fiona York, CEO of Housing for the Aged Action Group, says she’s happy to see the retirement gap “recognised” by the SCA report.

“We’ve known for a long time that there’s a really big difference in renting as an older person compared to owning your own home,” York told SBS News, adding that the issue is often overlooked in Australia’s retirement housing system.

“We know that older renters are living in really expensive housing, it’s often of poor quality, and this is having real impacts on their mental and physical health.”

She said older women can be disproportionately impacted by the retirement saving gap: “We know that older women have got less superannuation than men. They are more likely to be living in poor quality and expensive housing.”

Data from the Australian Institute of Health and Welfare indicates that as of June 2025, one-third of age pensioners receiving Commonwealth Rent Assistance still faced rental stress, spending more than 30 percent of their income on rent.

While the federal government updates the Commonwealth Rent Assistance Rate twice a year in line with the Consumer Price Index (CPI), Ellis says the rate rise doesn’t align with rapid rent increases, and suggested the government could raise it to ease rental stress.

Under the scheme, which can be available for people on certain welfare payments such as the Age Pension and Austudy, a single renter can receive the maximum fortnightly payment of $215.40 if their fortnightly rent is over $439.20.

“This issue isn’t isolated to specific areas; it spans across all of Australia,” the analysis states, emphasizing the widespread nature of rental stress for retirees.

Issues won’t be solved by ‘moving around’

The SCA report also compares renters across capital cities on how much they need to save to share the same standard of living with homeowners in their cities by the age of 65.

In Adelaide, a single person who rents a one-bedroom apartment will need $509,000 in retirement savings, while a Sydneysider in the same situation needs $794,000.

Ellis says the differences result from the varied rental prices. A single retiree who pays $380 per week for rent in Adelaide may have to pay $590 per week for an equivalent in Sydney, according to the report.

“Even in the cities that have cheaper rents, we’re seeing that renters still have more out-of-pocket costs than what homeowners do,” she said.

“So it’s not like there’s a cheap place to rent where this problem goes away. It’s across all of Australia.”

For those who are yet to reach retirement age, Ellis says it’s important to have a plan around superannuation.

She says while many young Australian workers will get at least 12 per cent of salary being put into superannuation, those who are retiring today would have received 9 per cent for much of their working life.

“So younger people are getting a larger contribution to super, which should help them save a decent superannuation balance by the time they retire,” Ellis said.

“But hopefully by the time they retire, the government has also improved rent assistance and done the work to build more affordable housing, so that there’s secure housing options for retirees who rent in the future.”