A new report has found that Australians now have the second longest average life span in the world – only the Japanese live longer. Today’s average life span of an Australian at birth is about 81 years — some 25 years longer than a century ago — and rising.
While this is obviously good news, it poses a serious financial challenge to the immediate future generations of senior Australians who are not prepared for such an extended period of retirement. How will they fund a decent lifestyle for so long?
There is an excellent article in The Australian today that summarises the problem and offers potential solutions. The author, Dr Don Stammer, correctly identifies reverse mortgages as a good solution in many cases, if done correctly. Dr Stammer advocates – as does Seniors First – taking reverse mortgage funds as gradually as possible to better preserve equity for children and beneficiaries.