Australia: Retirees’ Christmas Bonuses Could End Up under the Mattress Due to Financial Fears for 2009

Latest Citibank Retirement Index Released this Week.

* 40% of Australian retirees and semi-retirees aged 55+ years, say they are worried about having enough money/ investments – up 15% from last year
* 40% are concerned about relying on an age pension – up 33%
* Confidence levels have declined to 63 from 75%
* 44% of women are concerned about their money lasting the distance, compared to 35% of men

Sydney – The Federal Government’s Christmas bonus is welcome relief for the 40% of Australian retirees and semi-retirees with financial worries, the latest Citibank Retirement Index and Australian Wealth Report has found.

The Citibank Retirement Index and Australian Wealth report was released today and found Australian retirees are doing it tough and are making cutbacks of at least $33 per month. Women are particularly vulnerable, having cut back on discretionary spending by almost $50 per month.

According to Tania Browne, Investment Consultant & Advice Coach, Citibank, the global financial crisis has clearly taken its toll on the purse strings of Australian retirees, with significant cutbacks being made across the board compared to last year.

“In the last 12 months we have seen the confidence of our senior Australians decline significantly. Our research shows that they are concerned, and that level of concern is spilling over into their behavior and how they’re spending their money. They’re putting it away for the expected drier times ahead" Ms. Browne said.

“It’s also alarming that about one in three – 35% – of today’s semi-retirees and retirees aren’t sure their money will last the distance. Clearly this level of uncertainty and concern will have implications for how this group will behave and spend in the coming year.

“With these figures in mind it’s likely that our retirees will continue their belt tightening ways and hold on to their Christmas bonuses, saving rather than spending as the Government is hoping they will in order to stimulate the economy. With approximately four million Australian retirees eligible for part of the $10.4 billion stimulus package, this could mean millions being put away for a rainy day instead of lubricating the tills this sales season"

Research Methodology

1. Research conducted by Newspoll in June 2008. The research was conducted nationally among 404 respondents aged 55 years and over who are semi or fully retired.