Australian retirees are withdrawing their pension savings at increasing rates as global turmoil and surging inflation erodes their already fragile confidence.

At Colonial First State (CFS), one of Australia’s largest pension and wealth managers, retirees ramped up lump sum withdrawals in March as the US-Iran conflict escalated, according to the latest available data from the A$179 billion (S$164.3 billion) firm. Requests from members without financial advisers rose 55 per cent compared with 2025.

The move likely reflects “broader cost‑of‑living pressures such as increased fuel costs”, CFS’ chief of superannuation Kelly Power said in an interview in Sydney. “We think people are protecting themselves and potentially stockpiling some savings.” 

The rising cost of living continues to be the biggest concern for Australians over the age of 60, research from annuities provider and investment manager Challenger showed in April. For savers approaching retirement, almost half fear running out of money and lack confidence in managing their finances once they stop working, according to separate research from the corporate regulator in April. 

Market volatility in March also prompted many Australians to switch investment strategies within their superannuation funds amid fears for their retirement balances, A$100 billion pension fund HESTA said. Some moved out of typical balanced portfolios into more defensive options such as cash and term deposits, leading the fund to warn against knee-jerk reactions and missing the recovery. 

Rival fund UniSuper also reported more switching activity from growth options to defensive options during the Iran conflict, in a recent update to members. BLOOMBERG