Once you reach age 60, retirement should be high on the agenda. By age 70, most Australians have already retired or are approaching the final few years of their working life. It's this 60 to 70 age bracket when your superannuation balance is more important than ever.
By this age, you should already have, or be close to, the superannuation balance you need for the retirement lifestyle you want.
The problem is, it's sometimes difficult to work out exactly what that is. Here's a breakdown of the average superannuation balance for Aussies the same age. How does yours measure up?
Image source: Getty Images
What is the average superannuation balance at age 60 in Australia?
According to the Association of Superfunds of Australia (ASFA) data, the average superannuation for men aged 60-64 is $395,852, and for women it is $313,360.
What is the average superannuation balance at age 70 in Australia?
ASFA data also shows that the average superannuation for men aged 70-74 is $510,785, and for women it is $449,540.
How much superannuation do I need to retire?
If your superannuation balance is on track with the rest of the population, that's great news. But it still might mean you don't have enough to live the retirement lifestyle you want.
According to the latest ASFA Retirement Standard, the benchmark for a comfortable retirement has just climbed higher. Australians now need $54,840 a year, or $77,375 a year for a couple.
A comfortable retirement includes top-level private health insurance and enough money for an occasional holiday, meals out, or home repairs. This assumes you already own your home outright.
For a comfortable retirement, your superannuation balance at age 60 should be close to $496,500. By age 67, this should be closer to $630,000 for a single and $730,000 for a couple.
But there are also other lifestyle options.
Australians who are happy with a modest lifestyle, where you have basic health insurance, money for essential bills, and leisure activities or holidays are infrequent or non-existent, need a little less. A modest lifestyle is estimated to cost around $35,503 for singles and $51,299 for couples. To fund this, by age 67, you'd need $110,000 in superannuation as a single or $120,000 as a couple.
Then, if you're still renting in retirement, you can expect the same modest lifestyle level, but for a much higher $50,055 or $67,639 per year for singles and couples, respectively. To fund this, a single person would need $340,000 in their superannuation by age 67, and a couple would need $385,000.
Top tips to boost your superannuation in the years before retirement
If you haven't got enough in your superannuation for the lifestyle that you want, there are a few last-minute things you can do to boost your savings before it's too late.
You can delay retirement and continue working (even part-time) for a few more years. Even 3-5 years would hike your superannuation balance and also give your investments more time to grow.
If possible, make additional contributions wherever you can. From concessional contributions to spouse contributions, any additional funds will increase your superannuation balance and can improve your retirement lifestyle.
It's also vital at any age to maximise what you already have saved. Make sure your fund outperforms benchmark indexes like the S&P/ASX 200 Index (ASX: XJO) and suits your personal risk profile. High costs or underperforming funds can materially impact your balance at retirement age.
