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The truth behind three myths about spending in retirement

Susan Bell Research designed and conducted a survey commissioned by Super Consumers Australia into how and why people over 65 were drawing down their super. The survey busts some of the very common myths that have been circulating among retirement marketers and policy makers. I summarise three of them here.

Overall, the survey shows that the current system of accumulation then pension is misaligned to the way people in 2023 are working and retiring.

Our conclusion: The problem is that the system doesn’t understand retirees, not that retirees misunderstand the system

Three myths – and the truth

Myth 1: Retirees draw down the minimum to be frugal

People who have converted their super to pension mode have to draw down a certain percentage of their balance each year. They can draw down more, but most draw down the legislated amount, known as ‘the minimum’.

The truth: More than half – 53% – drew down the minimum last year because they did not need to spend any more money. 30% have other sources of income while 37% were following advice. Most retirees in fact say they are comfortable financially in retirement. They are not being frugal.

Myth 2: Retirees have accounts in accumulation mode because they misunderstand the retirement system

There are tax advantages to converting superannuation accounts to pension mode, however some people eligible to convert to pension mode do not do so. We keep hearing at conferences and in meetings that this is because they don’t understand the potential benefit.

The truth: Most people 65 and over who had an account in accumulation mode were still working, so they needed to keep that account. They had made a deliberate, informed decision to keep it as it was.

Myth 3: People with inactive super accounts are disengaged

Inactive accounts are super accounts in accumulation mode that have no contributions going in. Some have described retirees with inactive accounts as ‘disengaged’ and therefore have not converted to pension.

The truth: 58% people with an inactive account said they don’t need to draw on this money which they would have to do if the converted it a pension. 18% are keeping it there in case they work again., while 13% were unsure what to do. They is no evidence at all that that they are disengaged. They know what they were doing.

How qualitative research helped to reveal the truth

When we received the brief from Super Consumers Australia, we knew that we needed to start with qualitative research because it would ensure that the survey was based on what people in this age group actually do, think, and know – and it would be written in language that they themselves use and understand.

Qualitative research helped people speak about superannuation in the context of how they live their lives, rather than being having to answer questions focussed only on the superannuation system itself. It allowed us to talk to couples together as well as individual interviews.

To find out more about our retiree insights work, check out:


The SCA report

To read more insights from the survey, you can access the SCA report here

What next?

If you want to know how your customers or members are thinking about, ignoring, or planning for retirement, contact Sue. for an obligation-free chat.

We are unique in that we understand the retiree market from a cultural, social, and individual perspective – and we would love to work with you.

Susan Bell Founder & Lead Consultant
Sue Bell, Founder & Lead Consultant

We would love to hear from you, and are always happy to talk through research methods and options with you, if you are not sure what you need. Why not get in touch for a free, obligation-free, and confidential conversation.

Find out more about Susan Bell Research.

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