Retirees have never been so well off

Most retirees own their own home, which has almost certainly increased significantly in value, and is about to increase further in the wake of cuts in interest rates.

The review pointed out that many retirees pass away with even more assets than they had when they retired, suggesting huge scope for greater contributions. The Grattan Institute estimated average wealth for households over 75 at about $1m, including almost $600,000 in home equity. About 15 per cent of age pensioners live in homes worth more than $1.5m.

As a group, retirees have never been so well off, courtesy in large part to unprecedented increases in asset prices. Yet fewer than 2300 retirees were making use of the Pension Loans Scheme, a subsidised reverse mortgage, as of March this year, according to government statistics.