The RBA recently cut interest rates to point one per cent and said that they wouldn’t be increased for at least 3 years in order to get employment up and inflation down.
According to Alan Kohler on the ABC, if you had one thousand dollars in your bank account, they would pay you 50 cents in interest for the year. Enough for one banana.
This directly impacts on our self-funded retirees.
As Alan Kohler also says, ten years ago someone that had saved half a million dollars towards their retirement through hard work could expect to make the equivalent of the aged pension, about $25,000 a year from a safe bank term deposit. The days of earning a living from savings without taking a risk are gone.
Our self-funded retirees are one group that has been left to fend for themselves, while others have been supported through the COVID-19 crisis.
Government’s need to be innovative when considering ways to support this group of Australians.
My message to self-funded retirees is, if you find yourself with changed circumstances today, I encourage you to speak to your accountant or financial advisor, visit Centrelink and see what support is available to your new-found situation.
As always, if my office can be of assistance, then please make contact.
That is just as I see it.