Given how low the Australian pension is, if you are aiming for a comfortable retirement, you will undoubtedly want to finish your career with as much superannuation as possible.
But given that most people understandably don't talk about their superannuation balances with their friends and colleagues, it can be difficult to know how you compare to the average person and whether you are on course to retire wealthy or not.
Knowing your balance and where you stand compared to your retirement goals is very important. That's because if you have fallen behind the curve, you have time to make extra contributions to hit your target.
For example, if you have recently turned 50, you currently have 17 years until you hit retirement age. Thanks to the power of compounding, that's more than enough time to generate significant wealth from ASX shares.
But what is the average Australian superannuation balance at age 50 in 2024? Let's take a look at what the data shows.
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The average Australian superannuation balance at age 50 in 2024
Well, firstly, the data for 2024 is not yet available, but it's safe to say that the numbers won't have changed much since the last data release.
According to the nation's largest super fund, AustralianSuper, the average superannuation balance for women aged 50-54 in 2023 was $191,400. For men aged 50-54, the average balance stood at $289,900.
Though, it is worth noting that this is the average across the 50-54 years old range. It is probable that most 50-year-olds will have superannuation balances below the average of this group.
Nevertheless, let's imagine that we can compound these figures by 9% per annum for 17 years and add $750 a month to the balances. What will we end up with?
For women aged 50, their superannuation balance would grow to $1,177,081 by the time they are 67. And for men aged 50, their balance would become $1,603,352.
Is this good?
The good news is that these figures are at the comfortable side of retirement life.
For example, financial services company AMP Ltd (ASX: AMP) estimates that a single retiree needs to have $1.25 million in their superannuation to fund a "comfortable retirement." This allows for $50,207 in annual expenses using only their superannuation.
Whereas for a "modest retirement," a single retiree would need $795,000 for $31,867 per annum expenses.
What if you're behind the curve?
If you're behind the curve with your superannuation balance, the best thing to do is to make extra contributions wherever possible.
For example, if you were 50 years old with a superannuation balance of $150,000, if your balance compounds 9% per annum, you could grow your superannuation to $1.2 million in 17 years by adding $1,200 to it monthly.
The key is to understand your balance and your goals, and what you need to do now to achieve the latter.
