Your 50s are a critical point when you need to start fine-tuning your retirement strategy. You need to focus your attention to paying off debts, paying off your mortgage, and maximising your superannuation.
By age 60, you need to have a plan in place. Perhaps you want to retire in a few years' time? Or perhaps you're happy to work (even just part-time) into your 70s?
Here's a breakdown of how much superannuation the average Aussie has saved by age 50, 60, and 70.
And then a breakdown of how much you actually need at each of those ages to be able to live a comfortable retirement lifestyle. Because the numbers aren't the same.
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What is the average superannuation balance at age 50?
According to data from the Association of Superannuation Funds of Australia (ASFA), the average superannuation balance for a 50 to 54-year-old male is $254,071, and for a female, it's $190,175.
What is the average superannuation balance at age 60?
For 60 to 64-year-olds, the average superannuation balance is $395,852 for men and $313,360 for women.
What is the average superannuation balance at age 70?
For 70 to 74-year-olds, the average superannuation balance is $501,785 for men and $449,540 for women.
How do those figures compare to what I actually need at age 50, 60, and 70?
Even if you're on track with the average Australian and their superannuation balance, it doesn't necessarily mean you have enough to live a comfortable retirement when the time comes.
The problem is that compulsory employer superannuation contributions aren't enough.
The Super Guarantee helps Aussies build savings for retirement, but it will never be able to fund the lifestyle that they want. This is especially the case while the cost of living continues to accelerate.
At the same time, many Australians think that because their superannuation is invested in a diversified portfolio, which is often benchmarked to broad market indices like the S&P/ASX 200 Index (ASX: XJO), it'll look after itself.
According to ASFA data, a comfortable retirement is expected to cost approximately $54,840 per year for individuals and $77,375 per year for couples.
That lifestyle requires a superannuation balance of around $630,000 for a single person, or $730,000 for a couple.
In order to reach that figure, you'd need a balance of $313,500 at age 50.
And then by age 60, your balance would need to increase to $496,500.
By your late 60s to early-70s, you need to be at or close to your superannuation goal of $630,000 to $730,000 (for a couple) if you want to retire comfortably.
