Australians are retiring with unprecedented levels of wealth. This wealth, which is primarily held in housing, investment properties and superannuation, allows retirees to draw incomes to support their retirement.
As Australians have become wealthier, we might expect government spending on social safety nets for older Australians to fall. Instead, we have seen these programs grow in real, per-person terms.
The overall result is older Australians have much higher incomes than previous generations of retirees. The average 75-year-old’s post-tax and transfer income 25 years ago was little more than 75% of an average Australian income. Today it equals the average Australian income.
