26 June 2017
Companion animals – the comfort and costs in retirement – how much super do you need to have a pet?
If, in retirement, you want the comfort of a pet, whether it’s the devotion of a dog, the cool companionship of a cat or the financially less frittering friendship of a fish, you need to find the funds to invest in the ongoing relationship.
Even a bird can be a fiscal burden in retirement. Rabbits, reptiles and guinea pigs can also eat into your nest egg.
For a dog the ongoing cost on average is $1,725 per year and cats come in at $1,280.
A fish is practically free at $60 per annum but they are not always affectionate. Birds can be a bit more affectionate at $120 annually.
These costs include depreciation or an annual allowance for purchase and replacement costs.
Longevity risks, as in everything with super and retirement, apply.
An estimated 60 per cent of Australian households own a pet but that drops to around 30 per cent for retiree households.
Retirees who are or want to be pet owners need to plan properly, according to the Association of Superannuation Funds of Australia (ASFA).
ASFA CEO Dr Martin Fahy said it was worth Australian pet lovers chipping in some extra super to ensure Fido or Felix could be a forever friend.
“Many people would find it difficult to contemplate ditching the dog at retirement due to cost factors but it does happen and it’s a tragedy for the pet and owner,” he said.
“Ideally, one’s retirement shouldn’t mean your pet’s untimely retirement from the household budget.
“With the cost of a dog or cat being tens of thousands of dollars over its lifetime and in some cases much more, depending on diet, health issues and age, it’s worth checking your super calculations to make sure you have fully factored in your furry, feline, feathered or fishy friend.”
ASFA estimates pet lovers will need to have an additional $34,500 of super savings at the time of retirement to cover the cost of a dog or $25,600 to cover the cost of a cat.
These amounts are on top of the estimated $640,000 in savings needed to cover the standard retirement costs of a couple at the ASFA comfortable level. A single person needs $545,000 to be comfortable.
“Many Australians would not consider their retirement as comfortable without their pet so boosting your super savings to cover pet costs can add to both your creature comforts,” Dr Fahy said.
Australians spent $12.2 billion on pet products and services in 2016. Costly, but at any age, pets can offer humans comfort and companionship, security and protection.
Pets may also be good for practical heart health, as well as warming one’s heart with love.
Results of a three-year study of 5,741 people at the Baker Medical Research Institute in Melbourne showed pet owners had lower blood pressure and triglyceride and cholesterol levels than non-owners – a result that could not be explained by personal differences like cigarette smoking, diet, weight or socio-economic profile.
Pet costs below apply.
| Annual costs | Dog | Cat | Fish | Budget Budgie |
|---|---|---|---|---|
| Food | $622 | $576 | $15 | $75 |
| Grooming | $129 | $45 | 0 | – |
| Boarding fees | $86 | $80 | 0 | – |
| Health care products | $248 | $159 | $15 | $20 |
| Vet fees | $390 | $270 | – | $15 |
| Annual allowance for purchase/replacement | $250 | $150 | $10 | $10 |
| Annual spending allowance | $1,725 | $1,280 | $60 | $120 |
| Additional lump sum needed at retirement | $34,500 | $25,600 | $1,200 | $2,400 |
*To keep a cockatoo comfortable might cost 50 per cent or more than a budgie, around $180 a year requiring a lump sum at retirement of $3,600.
Background: ASFA Retirement Standards have for more than 10 years benchmarked the annual budgets needed by Australians to fund either a comfortable or modest standard of post-work living.
A modest retirement lifestyle is considered better than the Age Pension, but still only able to afford fairly basic activities.
A comfortable retirement lifestyle enables an older, healthy retiree to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of such things as: household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.
Both budgets assume the retirees own their own home outright and are relatively healthy.
Pet ownership is not included in the standard budgets.
For further information, please contact:
Teresa Mullan, Media Manager, 02 8079 0806.
About ASFA
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral and non-party political, national organisation. ASFA’s mission is to continuously improve the superannuation system so people can live in retirement with increasing prosperity.
