In retirement, singles compared to couples have higher rates of poverty and financial stress, lower rates of homeownership, and lower levels of wealth*. Homeownership is a key factor in influencing retirement outcomes because homeowners have lower housing costs and an asset that can be drawn on in retirement.
Please note: Since the early 1980s, rates of divorce have steadily increased among older age groups. In 2016, around 19% (women) and 15.4% (men) aged 60-64 were divorced and single, compared with 6.7% and 6.3%, respectively, in 1991*.
Unfortunately, separation and divorce can have a considerable financial impact on a person—affecting employment, household income and spending, homeownership, household assets (incl. super), and debt^.
Please note: In 2018, the median age of divorce was 45.9 years (men) and 43.2 years (women), up from 35.3 years and 32.7 years, respectively, in 1980. This age increase has reduced the time a divorcee has to recover financially before retirement*.
Therefore, it can be difficult for a person—especially with children—to save an adequate home deposit and avoid LMI or a loan guarantor arrangement.
The Family Home Guarantee started 1 July 2021, to assist eligible single parents, with dependent children, purchase a home with a deposit as low as 2%, by guaranteeing any shortfall in the 20% deposit most lenders require.
*Australian Government, Treasury. (2020). Retirement Income Review: Final report, July 2020.
^AMP.NATSEM Income and Wealth Report. (2016). Divorce: For richer, for poorer.
Uploaded: 15 Sep, 2021