Australians are relying less on the age pension to fund their retirement as their super balances grow, according to Association of Superannuation Funds of Australia (ASFA) research.

The study revealed about 56 per cent of people aged 65 or over now receive a full or part age pension compared to 70 per cent in 2012.

Average superannuation balances for people aged over 15 were $202,644 for men and $164,206 for women in 2023/24, up from $192,119 and $154,641 in the previous financial year.

For pre-retirees, that is, those Australians aged between 60 and 64, the average balance was $371,379 and the median was $203,326. This was a rise from $355,451 and $189,618 respectively in 2022/23.

“Growing account balances are the product of two things: the fact that the superannuation guarantee has been increasing and the strong investment returns that super funds have delivered to their members over a sustained period of time,” ASFA chief executive Mary Delahunty explained.

“As more people reach retirement having had the benefit of double-digit compulsory super for most of their lives, we’ll see the system come to full maturity, with most retirees living on an income well above what Centrelink can sustainably provide as our population ages.”

Treasury’s “Retirement Income Review Final Report” predicts the proportion of people over 67 receiving either a full or part age pension will drop to 50 per cent by 2059.

At 2.3 per cent of gross domestic product (GDP), Australia has one of the lowest public pension expenditures among Organisation for Economic Co-operation and Development countries, where the average is around 9 per cent. Expenditure in Australia is also expected to experience a 2 per cent GDP drop over the next 40 years as superannuation balances grow.

“The system maturing means that we are constantly seeing Australians taking a step up, either from the full pension to a part pension, or from a part pension to being able to fully fund their own retirement through their savings,” Delahunty said.

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