The Australian Seniors Series: Inheritance & Retirement Report 2024

The Australian Seniors Series: Inheritance & Retirement Report 2024 Discover the Inheritance & Retirement Report 2024. Financial security, estate planning, and the growing trend of early inheritance for seniors.
  • Almost half of retirees over 50 are worried about financial security amid cost-of-living pressures.
  • One-third of Australians over 50 don’t have a Will, on average waiting until 44 years of age to start the process.
  • 7 in 10 Australians over 50 intend to pass on an early inheritance to the next generation to help them get ahead.

As we move through the later stages of life, navigating the complexities of retirement and inheritance becomes increasingly important. As many of us feel the pressures of inflation and the rising cost of living, balancing our financial stability with the desire to leave a legacy is trickier than ever.

The Inheritance & Retirement Report 2024 forms part of the Australian Seniors Research Series, exploring issues that matter most to Australians over 50. Surveying more than 1,200 seniors, this chapter provides an in-depth look at the challenges and decisions we face as we plan for our future financial well-being, from balancing our own needs to supporting our loved ones. From the importance of Will preparation and estate planning to the complexities of balancing our financial security and leaving a meaningful legacy—we explore how these issues are impacting senior Australians in 2024.

Retirement regrets: Financial security challenges for seniors

We often envision retirement as a time of relaxation and fulfillment. However, recently the pressure of inflation on interest rates and the cost of living has revealed a growing trend of ‘retirement regret,’ with many of us expressing concerns about financial security and overall satisfaction with our retirement lifestyle. Retirement planning is becoming more crucial than ever, with nearly half (47%) of our retired community feeling uncertain about their financial stability, and over a third (35%) citing unexpected expenses – such as medical costs or home repairs – as major stressors.

One of the biggest areas of concern for most of us (90%) is the uncertainty of affording healthcare expenses in retirement. In fact, the general increase in medical service costs (47%), uncertainty about future healthcare needs (44%), and long wait times for treatment (40%) are among our biggest worries. In response, over a quarter (27%) of us have proactively set aside dedicated savings for healthcare costs, providing a safety net for unexpected medical bills without disrupting our overall retirement budget.

This uncertainty is more pronounced among women, with over half (52%) expressing concerns about their financial stability compared to just over two-fifths (42%) of men.

Life’s unpredictability often means we need to revisit and adjust our retirement plans. Nearly half (46%) of us have made changes due to unforeseen expenses, such as healthcare costs or family emergencies. These adjustments have led many to shift our retirement goals, with two-fifths (40%) of us prioritising financial security over travel or leisure activities. In fact, almost a third (30%) of us have chosen to delay retirement or return to part-time work to supplement our income.

The juggling act: Retirement vs. legacy

One of the significant challenges we face in retirement is balancing the desire to leave a substantial inheritance with the need to maintain our own financial security. In fact, nearly three-quarters (72%) of us prioritise leaving a legacy, but almost half (48%) worry about the impact it will have on our financial stability.

Sadly, most (75%) of us are worried that we may not be able to leave a substantial inheritance, with the top barriers being the rising cost of living (74%), inadequate savings (43%), healthcare costs (37%), and ongoing financial commitments (37%). To combat these concerns, nearly two-fifths of us are postponing retirement to build a larger inheritance pool for future generations.

Meanwhile, over half (55%) of us have adjusted our plans to account for increased living and healthcare costs. This often means scaling back what we’re able to leave behind for our families to ensure we can cover our own immediate needs throughout retirement.

The importance of estate planning: Avoiding Will gaps

While estate and legacy planning is an important step in ensuring our final wishes are met, a surprising number of us are still putting it off, with 44 years being the average age we start the Will preparation process. Almost a third (31%) of us have not yet created a Will, pointing to a significant gap in Estate planning, citing procrastination (45%), having limited assets (25%), and concerns about the cost (21%) as the most common barriers.

Meanwhile, nearly two-thirds (64%) of us already have a Will in place, but almost half (49%) of these haven't been updated for at least five years. Among those who have Wills, most of us sought professional assistance to draft them (64%) and discussed our plans with family members (54%). To help avoid potential family conflicts over inheritance, a growing number of us (25%) are opting for a more equitable distribution of assets among our children.

For many of us, the ability to provide for our loved ones is a strong motivator to get our affairs in order. Property is the most common asset we intend to leave behind, with almost two-thirds (62%) of us planning to leave property to the next generation, followed by cash savings (56%) and remaining superannuation (49%).

Amid the growing trend of a 'Great Wealth Transfer’, it’s clear many of us want to help the next generation get ahead given economic conditions and a challenging housing market, with almost 9 in 10 (89%) of us recognising the importance of leaving an inheritance for our children's financial security. For almost 7 in 10 (69%) of us, this has meant either already giving or planning to give our inheritance to our children or grandchildren before we pass away.

Adam Lubofsky, Chief Executive Officer and Founder of online Will creation service Safewill, explained why keeping your Will up to date is so important. “While typically Wills are first written when people are in their 40s or 50s, significant life events and changing family circumstances can mean that Wills are often out of date by the time a Will writer is in their 60’s”, he said. “People typically tend to update their Will only once every 10 years, but this becomes increasingly important for older Australians and where a person has had significant life changes. Events such as marriage or divorce can have the effect of invalidating a Will. It’s important to be regularly reviewing an estate plan to make sure it is current, valid, and reflective of what your wishes are at any given point in time.”

Balancing the need for financial security in retirement with the desire to fulfill our final wishes is a delicate yet essential responsibility – one that requires thoughtful consideration to ensure a meaningful and lasting legacy.

Adam Lubofsky - Founder & CEO - Safewill

Adam is the founder of Safewill, focused on products that assist with critical life decisions. Formerly a Management Consultant at the Boston Consulting Group, he specialised in corporate venture creation and private equity. Adam holds a law degree from Monash University, where he was awarded the Global Mobility scholarship and served as a student lecturer.

Find Adam on LinkedIn