Why rising living costs don't always tell the whole story
A few months ago, a couple came into our office for a review.
They were in their late 50s.
The mortgage was nearly paid off. Their super was looking healthy. Retirement was starting to feel real.
By most measures, they were doing well.
Then, halfway through the meeting, the husband said:
“Chris, I think we'll be okay. I'm just not sure about the kids.”
I've heard some version of that comment a lot lately.
In fact, one thing that has surprised me over the past few years is that some of the people most worried about money are also some of the people in the strongest financial position.
That might sound strange, but it makes more sense when you look a little deeper.
Everything Feels More Expensive
Let's be honest.
The weekly shop costs more.
Insurance premiums seem to go up every year.
Power bills aren't getting any smaller.
Filling the car isn't much fun either.
And every time there's talk of another interest rate rise, people naturally wonder what impact it might have on household budgets.
Nobody needs an economist to tell them life is more expensive than it used to be.
They can see it every time they tap their card.
The pressure is real.
But it's important to remember that rising costs and financial hardship aren't the same thing. Some households are doing it genuinely tough. Others are feeling the squeeze despite being in a relatively strong financial position overall.
“I Don't Know How Young People Are Doing It”
That's another comment we hear regularly.
Often from people who are actually doing reasonably well themselves.
They're not worried about missing a mortgage repayment.
They're not worried about putting food on the table.
They're worried about their adult children still renting.
They're worried about house prices.
They're worried about grandchildren one day trying to get a start.
One retired client put it this way:
“We bought our first house in our twenties. I don't know how they're ever going to do it.”
He wasn't talking about himself.
He'd already paid off his home.
His retirement income was secure.
His concern was entirely about the next generation.
And he's far from alone.
We Experience Money Through Spending
Most people don't sit around looking at their net worth.
They look at their bank account.
They notice what's going out.
Groceries
Rates
Insurance
Petrol or diesel
School fees
The unexpected dental bill
The hot water system that always seems to break at the worst possible time
That's how we experience money.
Most people don't know exactly what their super balance was last Tuesday.
But they know what it cost to fill the car, buy groceries and pay the latest insurance renewal.
That's why our feelings about money are often driven by day-to-day spending rather than our overall financial position.
Which is also why it's possible to feel worse off even when your financial position is improving.
The Contradiction We See Every Week
Over the past few years we've met plenty of people who tell us they feel under pressure.
Then we look at the numbers.
Their mortgage is lower than it was five years ago.
Their super has grown.
Retirement still looks achievable.
Yet they don't necessarily feel more secure.
The feeling isn't always coming from their own finances getting worse.
It's often coming from watching everyday expenses rise and wondering what the future looks like for the people they care about.
Those are two very different things.
Of course, this won't resonate with every household. For some Australians, particularly renters and lower-income households, financial pressure isn't just a worry about the future. It's a daily reality.
The Generation Caught in the Middle
Many people in their 50s and 60s seem to be carrying several financial responsibilities at once.
They're planning retirement.
They have adult children who might still need help.
They may have ageing parents requiring support.
And somewhere in the middle they're trying to work out what's enough.
One thing we hear regularly is:
“I don't want to retire with debt.”
Even from people who expect they may eventually receive an inheritance.
Most don't want their retirement plans to depend on it.
They'd rather know they can stand on their own feet because life rarely runs to the timetable we'd like.
The Bank of Mum and Dad
Eventually the conversation turns to help.
Should we contribute towards a deposit?
Should we lend money?
Should we gift money?
Can we afford to help?
The desire to support children is completely understandable.
The challenge is making sure today's support doesn't create tomorrow's stress.
Retirement can last 20, 30 or even 40 years.
It's important to look after the next generation.
It's also important to look after yourself.
Maybe That's the Real Cost-of-Living Conversation
The public debate is often about inflation, interest rates and house prices.
Those things matter.
But around most kitchen tables, the conversation is often more personal.
It's about family.
It's about opportunity.
It's about wanting children and grandchildren to have choices.
It's about wanting to help without putting your own future at risk.
And that's why I think many Australians feel poorer than they are.
Not because they're necessarily struggling themselves.
But because they're worried about the people they care about most.
Final Thoughts
Most people approaching retirement aren't trying to get rich.
They're trying to get comfortable.
They want the mortgage gone.
They want enough money to enjoy life.
They want the freedom to help family if they can.
And they want confidence that they won't become a burden on anyone else.
In our experience, that's what's behind many cost-of-living conversations today.
Not fear for themselves.
Concern for the next generation.
And perhaps that's the financial question many Australians are really asking:
"Will the people I care about be okay?"
That's a conversation worth having.
If you're approaching retirement, the biggest financial questions often aren't about investment returns or interest rates.
They're about family.
Can I retire comfortably?
Can I help my children if they need it?
Will I have enough if life doesn't go according to plan?
Those questions rarely have simple answers, but they are worth talking about.
A good financial plan can help you understand what's possible, what risks need to be managed, and how to balance supporting others while protecting your own future.
Because sometimes the most important financial decisions aren't really about money.
They're about the people you care about.
General advice warning: The information in this article is general in nature and is not intended to be personal financial advice. Financial decisions should always be considered in the context of your own goals, circumstances and needs.