The 2025 Challenger Retirement Happiness Index has highlighted the need for financial security and better financial education as cost-of-living pressures shake retirement confidence.
The report found that 76 per cent of pre-retirees say cost-of-living pressures have impacted confidence that they will have enough money to last in retirement, up from 70 per cent last year.
Women are more financially vulnerable in retirement, with 34 per cent having said they are extremely or very worried about outliving their savings, compared to 20 per cent of men.
The research also found that demand for financial security in retirement is growing, with 85 per cent of pre-retirees seeking greater certainty about their financial future. One in five said they don’t know what resources are available to help them plan for retirement.
Mandy Mannix, chief executive of customer for Challenger, said women and unadvised Australians faced the highest barriers to a confident retirement, with a third of women over 60 extremely or very worried about outliving their savings, while unadvised Australians are twice as likely to be extremely or very worried about outliving retirement savings.
“We know retirement can be one of the most rewarding stages of life—but confidence is key,” Mannix said.
“When people feel uncertain about their finances, they tend to hold back. That’s led to a chronic underspending problem in retirement, with many Australians living more cautiously than they need to.”
She continued that retirees go from a steady pay cheque to a lump sum, and that sudden shift makes it hard to budget with confidence.
“That’s why a guaranteed, regular income for life is so powerful—it replaces that pay cheque, can keep up with inflation, and gives retirees the freedom to actually live their best life in retirement.”
“Three in four Australians aged 60+ believe better financial education would improve their happiness, but half say they don’t have the resources to plan for retirement. One in five – around 1.2 million retirees – don’t know where to start.”
The Challenger Retirement Happiness Index findings aligned with recent UNSW research, which revealed 57 per cent of people don’t even know that lifetime income solutions exist, despite their ability to significantly improve confidence to spend in retirement.
“With nine in 10 unadvised (those who have never received financial advice) Australians wanting free, basic retirement education, there is a significant opportunity to improve financial literacy and help retirees feel more secure about their future,” Mannix said.
