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Ask Paul: I have $900k in super, but can't afford to retire

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With $900,000 in super but rising housing costs, one renter faces an impossible choice between keeping the pension and securing a home for the future.

Reader question

I'm a single, 62-year-old renter in Melbourne living in a share house to keep my rent low.

Renting at 62 with $900k in super, one reader faces a tough choice between the pension and buying a home. What would you do?
Owning a home can provide long-term security. Photo: Paul Clitheroe, Getty Images.

I receive a carer's pension, as I'm caring for my daughter.

I have $900,000 in super (some from inheritance).

If I keep renting, I will have too much money in super to continue receiving the pension at 67, but not enough to live on for another 30 years.

If I want to continue on a pension, I could buy a home (for example, a unit), but prices are so high it would leave me with very little super for the next 30 years.

Retirement villages seem to have very high fees. I'm not sure what my best option is.

Any suggestions? - Sherri

Paul's response

I think that a lot here depends upon your daughter and her long-term needs, Sherri.

We are in Melbourne a lot; our youngest child lives there.

I don't know where you live, but I popped in 'two-bedroom, two-bathroom apartments with parking in the inner-city region' into a search engine. I set the filter at a maximum price of $500,000.

My thinking was that I would like you to own a home but have an amount in super that at age 67 would give you maximum, or at least a part age pension. A lot of options appeared in locations close to the city.

My experience, and one I think widely shared by Money readers and pensioners more generally, is that homeownership makes life a lot more certain and much more settled.

A home is also a good investment, and doesn't impact a future pension.

The extent of care your daughter needs and your carer support is fundamental to your decision.

You do have money going out in rent.

Homeownership would remove this expense. I'd encourage you to do your own research, based on your own needs and expectations, but my view is that owning a home will be a plus for you and your daughter.

It could also provide long-term security for her.

Maybe the foundation of a plan could be to own a home, while not jeopardising your carer or age pension.

You know best what your and your daughter's needs are, but I'd put homeownership into your thinking, while maintaining a reasonable super balance and allowing for future age pension options under the income and assets test.

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Paul Clitheroe AM is the founder of Money and serves as the publication's editorial adviser. One of Australia's most trusted personal finance experts, Paul has spent decades helping Australians build wealth, manage debt and make smarter money decisions. He is widely known for host­ing the Money TV program and authoring best-selling personal finance books. Since launching Money in 1999, he has played a leading role in delivering practical, independent financial guidance to Australians. Paul is chair of Ecstra Foundation, a national not-for-profit focused on improving financial wellbeing. He is also chair of InvestSMART Financial Services, and previously led the Australian Government's Financial Literacy Board and Financial Literacy Australia from 2004 to 2019. In academia, Paul is chair in financial literacy at Macquarie University, where he is also a Professor in the School of Business and Economics. Ask Paul your money question. Due to volume, Paul cannot respond to questions posted in the comments section.
Comments
Patrick Hockey
May 19, 2026 11.27am

No brainer! Buy a residence.

Mike Richards
June 5, 2026 2.53pm

You have $900k to retire on PLUS your carer's allowance, you are in a lot better position than many other people in Australia. Even at a conservative 5%, greater in high dividend shares, you would get $45,000 to live on - tax free - without ever eating into the capital.

Sorry, but it seems to me that if you can't live on that in a cheaper, maybe (shock) regional area or move interstate, something is wrong with you, not your money. Not everyone HAS to live in a capital city, let alone one as expensive as Melbourne.