How much will I need to retire?
The amount you’ll need in retirement will depend on the lifestyle you want.
A rule of thumb is if you own your own home, you’ll need around 70% of your current annual income to maintain the same standard of living.1 With this in mind, let’s explore some key influences further.
There are a few things to consider when assessing your future income needs.
How much super do I need?
It’s hard to know how much you’ll spend on a lifestyle you haven’t started living yet. The retirement standard from the Association of Superannuation Funds of Australia (ASFA) provides some guidance around how much the average Australian would need to live a modest or comfortable lifestyle in retirement.
| Modest lifestyle | Comfortable lifestyle | |||
|---|---|---|---|---|
| Single | Couple | Single | Couple | |
| Income per year | $31,785 | $45,808 | $50,004 | $70,482 |
| Super balance required at age 67 | $100,000 | $100,000 | $595,000 | $690,000 |
Source: ASFA Retirement Standard, based on the March 2023 quarter, if you own your home (no mortgage) and are relatively healthy.
ASFA describes a ‘modest’ lifestyle as one that allows you to cover life’s basics, like groceries, bills and transport. A ‘comfortable’ lifestyle lets you pursue your hobbies, take out private health insurance, buy a reasonable car and travel.
Find out how much super you may have
Start your retirement planning with the Retirement income calculator. By answering a few simple questions, it can help determine how your super is tracking and what you can do now to help create the lifestyle you want in the future.
Get my super projectionThere are a few ways to make extra contributions to your super to help you achieve a healthier super balance, and even save on tax.
Getting your super into one place before you retire can be an important step when getting ready to continue to pay yourself an income when you finish work. Combining your super accounts could save you thousands in account management fees and is a great way to help you protect your hard-earned super.
Your investments are there to do the heavy lifting when you’re no longer working. As you move closer to retirement, it’s important to assess whether your current investment choices, and your appetite for risk, will satisfy your needs in retirement.
Your insurance needs change as you get older. Do you have insurance cover that no longer suits your personal situation? Look at your insurance in super to see if it’s still meeting your needs.
You could dial down your working hours and keep the same income. A transition to retirement (TTR) account will allow you to draw an income from your super, while you continue to grow your retirement savings – and potentially minimise your tax too!
1 https://www.superguide.com.au/retirement-planning/comfortable-retirement-how-much-super-need
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