Half of us are terrified of retirement. Here’s why you might be OK

Last year I wrote a column taking a long hard look at a pattern I kept seeing in the superannuation industry: report after report measuring how anxious Australians feel about retirement, with very little action to show for it.

PR dressed up as progress, I called it, and my readers agreed loudly. We don’t need more reports, we need more action to help members navigate their retirement.

So when Colonial First State’s annual Rethinking Retirement report landed on my desk this week, I’ll admit I picked it up with a slightly raised eyebrow. But then I read it properly. And then I read it again. Because CFS has actually done a lot of work on its retirement and advice propositions this year, not just commissioned another survey.

And there was a finding buried in that report truly worth sharing and talking about today. It could be the most important thing I’ve read about retirement all year.

It concerns the amount of worry people are expending on retirement, possibly unnecessarily, and how such worry has surprisingly little to do with the money they have as they approach retirement but more to do with how proactive they are in understanding their real position.

According to the CFS report, almost half of all Australians (49 per cent) don’t feel prepared for retirement. Among that group, more than half (56 per cent) are actively worried about it.

However, among Australians who do feel prepared, such worry falls to just 15 per cent. Same economy, same cost of living, same grocery bills. The difference? Whether they know where they stand.

Picture two people sitting next to each other on the train, both with about the same amount in super, both stretched by the same cost-of-living crisis. One is sleeping fine at night. The other is staring at the ceiling at 2am.

The gap between them isn’t the size of their super balance. It’s the fact that one has looked at their numbers and worked out what their retirement could be like.

That means understanding whether the age pension will kick in and when, how it sits alongside their super, what kind of fortnightly income that combination can really deliver, and whether they still need to work or actually have more choices than they had considered. Even a rough picture of that future is worth more than years of vague hoping that all will work out fine.

Many people in the industry would see this and call it an advice gap, a signal that Australians need to go and see a financial adviser. And for people in complex situations, that’s sometimes true.

But I’d push back hard on that as a catch-all answer. For most Australians