Many people are at the peak of their careers in their late 40s, which means they're possibly earning the most they ever will per year.
That means their superannuation savings are growing rapidly too, with employers now paying 12% under the updated Super Guarantee.
That all sounds good. But with the super savings you have today, are you on track for what is defined as a 'comfortable' retirement?
The latest tax data for the financial year 2023 shows the average superannuation balance of Australians aged 45 to 49 is $170,774.
If we break the numbers down between the sexes, the average superannuation balance for men aged 45 to 49 is $193,501.
The average for women aged 45 to 49 is $147,146.
Is this enough for a comfortable retirement?
How much do you need in superannuation for a comfortable retirement?
The Australian Retirement Standard is the trusted definitive guide to budgeting in retirement.
The Association of Super Funds of Australia (ASFA) created the Retirement Standard in 2004 and updates it quarterly for inflation.
Currently, ASFA says couples need at least $690,000 and singles need $595,000 in superannuation savings for a comfortable retirement.
These figures assume debt-free home ownership, a part-pension, and 6% total annual returns on superannuation savings.
So, with an average of $170,774 in your superannuation account at age 49, are you on track to reach $690,000 or $595,000?
Unfortunately, the answer is no.
According to ASFA's Super Detective calculator, a 49-year-old Australian needs $281,000 in super savings today if they want enough money by age 67 for a 'comfortable' retirement.
ASFA defines a comfortable retirement as being able to easily pay for all of life's essentials, plus some extras.
They include top-level private health insurance, a variety of exercise and leisure activities, occasional restaurant meals, a domestic trip once a year, and an overseas trip every seven years.
The good news, though, is you are on track for what ASFA calls a modest retirement.
For a modest retirement, ASFA says couples and singles need just $100,000 in superannuation in today's monetary terms.
This is a relatively low balance and reflects ASFA's assumption that retirees with a modest lifestyle receive the full age pension.
According to the tax data (which is two years old, remember), you've already got enough.
Both men and women have enough in their super with their average $193,501 and $147,146, respectively, to fund a modest retirement.
ASFA's definition of a 'modest' retirement is outlined here.
What if you want better for yourself?
This is a great question to ask yourself at this age, because the best thing you have going for you right now is time.
Time is all you need for the magic of compounding to do its job.
The average age at which Australians intend to retire is 65.4 years.
If that sounds about right for you, that means you have more than 16 years to get your superannuation savings in order.
If you want to shoot for a comfortable retirement, you need to get your super up to $690,000 or $595,000 by age 67.
There are several ways you can boost your superannuation savings.
The most obvious one is maximising your annual personal superannuation contributions.
Personal contributions can be concessional (you can claim a tax deduction) or non-concessional (no deduction).
There are caps in place: $30,000 per year for concession contributions and $120,000 per year for non-concessional contributions.
Because your total super balance is less than $500,000, you can also take advantage of the carry-forward rule.
This allows you to use any unused concessional contributions cap amounts from the previous five years.
Unused cap amounts expire after this.
Last week, we reported the average personal superannuation contribution being made by Australians each year.
