Costs for Australians seeking a comfortable or modest retirement have remained steady for the second consecutive quarter, according to industry data released yesterday.
The Association of Superannuation Funds of Australia (ASFA) Retirement Standard figures found a couple looking to achieve a 'comfortable' retirement will need to spend $55,080 a year, while those seeking a 'modest' retirement lifestyle need to spend $31,643 a year.
These costs have remained steady and are again marginally lower, down by a dollar or two a week, on the equivalent figures for the previous quarter for the first time since June 2010.
"The aggregate costs for a couple living comfortably in retirement were down by 0.3 per cent in the March quarter 2012 from the December quarter 2011," the report found.
"For a single female living at the modest level, costs were down by 0.1 per cent compared to the previous quarter."
The shift in costs over the quarter for retirees at the modest level was similar to the 0.1 per cent increase recorded in the All Groups Consumer Price Index (CPI), the report said.
"Along with generally owning their own home outright (so cost increases for housing are less important for retirees), on average they spend a negligible amount on education services, ensuring the rising cost of both secondary and tertiary education in the March quarter 2012 had relatively little impact on retiree expenses," it said.
"In contrast, food, health, transportation and recreation spending form a large part of retiree budgets."
Between the December quarter 2011 and the March quarter 2012, retirees experienced a 2.1 per cent decrease in the cost of food and over the year to the March quarter, there was a decrease of 2.5 per cent, it said.
The largest falls for the March quarter were recorded in Melbourne (-2.3 per cent), Adelaide (-2.3 per cent), Sydney (-2.2 per cent) and Perth (-2.2 per cent).
Largely responsible for this negative movement in all cities was a fall in the price of fruit over the quarter (by 30 per cent), due to impact of natural disasters such as Cyclone Yasi.
Electricity costs rose on average by three per cent, reflecting substantial price increases in a number of states.
Typically electricity prices in each state are relatively constant for a few quarters followed by a large increase. The price increase over the year was 9.9 per cent.
Transport costs increased 1.1 per cent, with a 2.5 per cent increase in the cost of automotive fuel. This was partially offset by a decrease in the cost of motor vehicles.
The 4.4 per cent increase in the price of health services reflected a 14.1 per cent increase in pharmaceutical prices due to fewer individuals benefiting from the Pharmaceutical Benefits Scheme safety net.
Over the year there was a 4.2 per cent increase in the cost of health services. Over the longer term, health services tend to experience higher increases in price than other categories of consumer goods and services.
