Take some of the guesswork out of planning for the future. Work out how much super you'll have when you retire, and if it will be enough to fund the lifestyle you want.
It's never too soon to start planning for a better financial future.
Estimate how much super you'll have
You probably know how much super you have now, but do you know how much you'll have when you retire?
Use the Moneysmart retirement planner to estimate:
- how much money you'll have to spend each year once you retire
- how fees, investment options and contributions will affect your retirement income
You can also use the planner to test out different scenarios and work out how to grow your super.
Estimate how much super you'll have when you retire.
How much super you'll need when you retire
The amount of super you'll need when you retire depends on:
- your big costs in retirement, and
- the lifestyle you want
Most people can now expect to live well into their eighties. This means that if you stop working at 65, you'll need retirement income for 20 years or more.
Your big costs in retirement
Think about any big costs that might be part of your retirement plans. For example:
- paying off your mortgage
- renovating your home
- medical costs
The lifestyle you want
There are a few different ways to work out how much super you need for the lifestyle you want in retirement.
If you're close to retiring use the budget planner to estimate how much money you expect to spend when you stop working.
If you own your own home, a rule of thumb is that you'll need two-thirds (67%) of your pre-retirement income to maintain the same standard of living in retirement.
Some organisations provide information on retirement spending:
- Super Consumers Australia has a set of retirement savings targets for people aged 55-59 and 65-69. They estimate how much you'll need based on low, medium and high spending.
- The Association of Superannuation Funds of Australia provides an ASFA retirement standard. This estimates how much money you'll need, based on a modest or comfortable lifestyle in retirement.
Build up your super
Many things contribute to your income in retirement, including investments outside of super and assets such as your home, especially if you downsize.
How much Age Pension you are eligible for also has an impact on how much super you need.
If you decide it is important to build your super, there are some actions that can make a big difference over time. Think about:
- consolidating your super into one account so you pay fewer fees
- making extra contributions to grow your super
- changing your super investment options
If you don't have as much as you'd like, start taking steps to build up your super to boost your retirement savings.
Throughout your working life, check your super at least annually. Check your fund has the correct personal details and tax file number (TFN). Review your employer's contributions, and your account fees, investment options and insurance. If you’re not satisfied or don’t understand any details about your fund, call them and ask questions.
If you need financial advice
Planning for your retirement is complex, and everyone's situation is different. Think about getting personalised advice from a financial adviser to help you plan ahead. Many super funds also provide this service.