Older Australians may not be comfortable investing in what they consider riskier assets in retirement.
But retirees will have to consider ways to stretch out their superannuation as they live longer than ever before.
A new study by State Street Global Advisers has found that an average couple will need around $500,000 to live comfortably in retirement, assuming they are in receipt of a part age pension, are relatively healthy and own their home.
However, as people age, unexpected health, medical and other costs can arise and they may live longer than they had planned.
The head of its Asia Pacific investment solutions group Mark Willis said many retirees are inclined to take what they see as safer investment options in retirement, such as cash and fixed-come portfolios.
That should allow them to draw on their super until the age of 90.
However, a more diverse portfolio that also includes a greater proportion of Australian shares, as well as international shares, property and other alternatives, would extend savings for a further eight years.
"Growth assets, which will generate sufficient returns to support lifestyle aspirations, outpace inflation and minimise longevity risk are critical," Mr Willis said on Wednesday.
Association of Superannuation Funds of Australia head Pauline Vamos says with escalating pressures on the federal budget, it is probably not the best idea to rely on the government to fund retirement and other age-related expenditure.
"Save as much as you can now and protect yourself against possible policy changes changes down the track," she said.
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