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Retirees are being hit harder by rising prices than the general population, with the costs that dominate their budgets rising quicker than inflation, according to the updated Association of Super Funds Australia Retirement Standard.

While the CPI rose 3.8 per cent in the 12 months to June 2026, the items that make up a large share of retirees’ spending rose much faster.

These included electricity up 22.4 per cent, maintenance and repair of vehicles up 6.5 per cent, medical and hospital services up 5.0 per cent and insurance up 4.9 per cent.

The one significant relief was petrol and diesel, which fell 7.3 per cent over the year on lower global oil prices and the temporary fuel excise cut.

Mary Delahunty, ASFA CEO, said retirees are among the groups hit hardest by the cost-of-living crisis because their budgets are weighted towards the things going up in price the most.

The Age Pension is adjusted twice a year in line with what pensioners actually spend, so someone living on the pension alone is broadly protected from price rises. Retirees living a comfortable lifestyle, however, are not. They spend on things the pension does not cover, like private health cover, a car and holidays, and those prices have been rising faster than the Age Pension.

The result is that the gap between the Age Pension and a comfortable retirement is getting bigger every year, and retirees’ super has to work harder to fill the gap.

“Super is the buffer between a life in which the bare essentials are covered by the Age Pension, and feeling comfortable and financially secure in retirement,” Delahunty said.

According to ASFA, a comfortable retirement for a couple who own their own home now costs $1,513 a week, or $78,998 a year. For a single homeowner, it costs $1,076 a week, or $56,166 a year.

The maximum Age Pension is currently $905 a week for a couple and $600 for a single, which will rise slightly on 20 September. The full Age Pension covers around 60 per cent of a comfortable retirement for a couple and around 56 per cent for a single.

The three levels differ little on essentials like food and utilities. The difference is in the discretionary spending that makes life comfortable.

For homeowners aged 65 to 84, the comfortable retirement budget rose 0.5 per cent for couples and 0.4 per cent for singles in the June quarter. The modest budget rose 0.4 per cent for couples and 0.3 per cent for singles, to $52,690 and $36,548 a year respectively.

For retirees aged 85 and over, the comfortable budget is now $74,484 a year for a couple and $53,964 for a single. For retirees who rent privately, the modest budget is now $69,376 a year for a couple and $51,418 for a single.

By: Keeli Cambourne | 18 September 2026 | smsfadviser.com