- Macquarie University research forecasts that Australia's pension eligibility age may need to rise to 70 by 2043, with nearly half of Australian households not on track for a comfortable retirement even accounting for superannuation and the pension combined.
- Recent policy changes in 2025–26, including adjustments to deeming rates and assets test thresholds, have already reduced pension payments for an estimated 180,000 Australians, signalling a long-term trend towards tighter eligibility and lower coverage.
- OpenCorp Executive Director Michael Beresford warns that millennials who rely solely on superannuation and the age pension risk a significant shortfall, as the superannuation system remains inaccessible until age 67 and the pension is likely to cover less of retirement costs over time.
- New property investment is highlighted as a growing strategy among younger professional households, with tax depreciation benefits, rental income, and long-term capital growth cited as key attractions for building wealth outside of superannuation.
- Melbourne teachers Ross and Genevieve Kirwan are presented as a case study, having purchased their first investment property in Queensland in 2020 for approximately $100 per week to hold, with subsequent capital growth enabling them to pay off their family home and plan a second investment purchase by 2026.
MELBOURNE, AUSTRALIA - Every pay cycle, Australian millennials contribute to a pension system that researchers say may not exist in any meaningful form by the time they reach retirement age. And most of them have no plan for what comes next.
Macquarie University forecasts the pension eligibility age will need to rise to 70 by 2043 just to keep the system financially stable, as fewer workers support a rapidly growing pool of retirees. At the same time, Australian Bureau of Statistics data shows nearly half of all Australian households are not on track for a comfortable retirement, even accounting for superannuation and the pension together.
The numbers raise a question that most working Australians have not seriously sat with: if the pension is no longer a reliable foundation, what does retirement actually look like for the generation currently in their 30s and early 40s?
"Most people know they need to do something, but the gap between knowing and acting is enormous. We see it every day. Couples in their 30s and 40s who are working hard, paying their mortgage, putting money into super and assuming that will be enough. For many of them, it won't be. The pension as we know it is already changing, and that change is only going in one direction," comments OpenCorp Exec Director of Property & Investment Services, Michael Beresford.
A system designed for a different Australia
When the age pension was introduced in 1908, it was built around a workforce and population that looked nothing like today's. Life expectancy was shorter, the retired population was smaller, and the ratio of working Australians to retirees was far more sustainable than it is now.
That ratio has been falling steadily as the Baby Boomer generation moves into retirement, and the pressure is only growing. Research from Macquarie University suggests the pension age may need to rise to 68 by 2029, 69 by 2037, and 70 by 2043. Each increment shifts more of the burden onto individuals to fund their own retirement years.
The superannuation system was introduced to help bridge that gap, and it has made a difference. The proportion of retirees using super as their main income source has grown from 20 per cent in 2014-15 to 28 per cent today. But the government pension remains the single most common income source for Australian retirees, and Treasury modelling shows significant numbers of Australians, particularly women, are still retiring without adequate savings.
Recent policy changes have tightened the picture further. Adjustments to deeming rates and assets test thresholds in 2025-26 reduced pension payments for an estimated 180,000 Australians who had previously qualified for the full rate. For younger Australians still decades from retirement, the trajectory points to a system that will cover less and less.
"People ask me whether the pension will still exist when they retire, and the honest answer is: probably something will, but it will not look like it does today. The eligibility age will be higher, the means tests will be tighter, and the payment will cover less of what people actually need to live on. That is not a prediction, it is what is already happening. The question is whether Australians are building something to sit alongside it, " says OpenCorp’s Michael Beresford.
What millennials are doing about it
For a growing number of working Australians, the answer to the retirement gap is not to rely on the system to fix itself, but to build income streams outside of superannuation while they still have time for compound growth to work in their favour.
The challenge is that most people do not know where to start. Financial literacy around retirement planning remains low, and the superannuation system, while valuable, is locked away until 67. For households that need accessible, income-generating assets before then, or want to supplement what super will provide, the options require more active decision-making than most are prepared for.
New property investment has become one of the more commonly discussed routes, particularly among younger professional households with equity in their home and some borrowing capacity. The attraction is not speculative, it is structural: rental income, tax depreciation benefits on new property, and long-term capital growth in markets where demand is supported by population growth and tight supply.
"The fundamentals of building financial security outside of super are not complicated, but they do require time. That is the one thing younger Australians still have on their side, and it is the one thing they are most likely to waste. We are not saying everyone needs to become a property investor. We are saying that everyone needs a plan, and most people do not have one," says Mr Beresford.
Case study: two teachers and a question about the future
The retirement income concern being raised by researchers and financial advisers is not abstract for most Australian families. For Ross and Genevieve Kirwan, Melbourne primary school teachers with three children, it was a practical calculation about what their working lives could realistically provide.
Ross, 39, and Gen, 37, had been in their own home for around eight years when a house nearby came on the market and prompted a conversation they had been putting off. Ross' parents had invested in property, and the couple began thinking seriously about what financial security would look like on two teaching salaries.
CLIENT STORY: Ross and Gen Kirwan Melbourne primary school teachers. Three children. First investment property purchased in Queensland through OpenCorp.
"Working in education we knew our limitations for earning and now with three kids we wanted to be able to set ourselves up with financial security and freedom," says Ross.
Gen says she initially assumed they would need to save a full deposit before they could do anything. "I didn't understand the process of taking out equity, I thought we had to save up a deposit first," she says. Once the process was explained, the couple found they had more capacity to act than they had assumed.
"One of our big things was that we didn't want it to impact our day-to-day life or put our current property in danger."
Rather than buying close to home, for their first property investment in 2020, they were guided toward a Queensland property that cost them little to hold and was positioned for strong capital growth. Brisbane was on the cusp of a significant price and rental boom.
"Michael [Beresford] showed us that the cost to rent in Brisbane was like Melbourne, but the cost to buy was so much more expensive in Melbourne. Then he showed us that investing in Queensland would only cost us approximately $100 a week. It was surprising to hear how achievable it was" commented Gen Kirwan.
Within a month of their first conversation with an adviser, they had signed a contract. Eighteen months later, the growth in that property had paid off the remaining debt on their family home. Fast forward to 2026, the couple is ready to use the equity in their first investment to purchase a second.
"The good thing we have found is that our everyday life has not been affected by purchasing an investment property. The fact that our day-to-day lives haven't changed and that it was such a smooth experience has triggered a thirst in us to invest again," says Ross.
"Our parents invested 20, 30 years ago. It was a different market, but with the same fundamentals and the same message: leave emotion out of it."
The Kirwans' story is not unusual among the clients OpenCorp works with, but it is also not the norm for Australian millennials more broadly. Most have not had that conversation, and many assume there is more time than there is.
The broader concern is systemic. Individual decisions around investment and retirement savings matter, but they sit within a policy environment that is already moving, and is likely to keep moving, in ways that put more responsibility on individuals and less on the state. For a generation that was told the pension and super would take care of things, that shift requires a different kind of planning than most have done.
OpenCorp is available to discuss Australia's retirement income outlook for millennials, the adequacy of superannuation as a standalone retirement strategy, and the role of broader financial planning in helping younger Australians prepare for an uncertain policy environment.
ENDS
For all media enquiries for OpenCorp’s Michael Beresford and OpenCorp clients Ross & Gen Kirwan, please contact AD Press Office.
Note to editors: Quotes attributed to Michael Beresford are provided for approval and subject to confirmation prior to publication.
Data references
1. Chen, S., Shang, H.L. & Yang, Y. (2024). Is Australian Age Pension Sustainable and Fair? Evidence From Forecasting. Austaxpolicy: Tax and Transfer Policy Blog, Macquarie University, 16 December 2024. Available at: austaxpolicy.com
2. Australian Bureau of Statistics (2025). Retirement and Retirement Intentions, Australia, 2024-25. ABS, Canberra. Available at: abs.gov.au
3. Australian Bureau of Statistics (2026). Age Pension rates, March 2026 to September 2026. Available at: abs.gov.au
4. National Seniors Australia (2025). Age Pension payment changes, September 2025. Available at: nationalseniors.com.au
5. Treasury, Australian Government (2025). Superannuation balances at retirement. Information Note, Revenue Group. Available at: treasury.gov.au
6. CommBank Retire Ready Index (2016). Ready, Set, Go: For Retirement. Commonwealth Bank of Australia.
7. Australian Institute of Health and Welfare (2021). Older Australians: Income and finances. AIHW, Canberra. Available at: aihw.gov.au
8. OpenCorp (2025). EOFY Property Market Update: June 2025. Available at: opencorp.com.au
9. Services Australia (2026). Age Pension rates and deeming rate changes, March 2026. Australian Government. Available at: servicesaustralia.gov.au
10. Webster, S. (2023). How two Melbourne teachers bought their first investment property and can afford a second. The Age, 22 December 2023. Sponsored by OpenCorp.
Statistical data cited in this release reflects figures current at time of publication. Projections and forecasts referenced are those of independent academic and government research bodies and do not represent the views of OpenCorp.
About us:
OpenCorp is one of Australia's leading property investment firms, providing investment, finance broking, and property management services from offices in Melbourne, Brisbane, Perth and Sydney. The firm has helped thousands of Australians build property portfolios since 2006. For more information, visit opencorp.com.au.
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