When it comes to retirement, we all want to make sure we have enough superannuation to afford the best lifestyle possible.
But working out exactly how much money you need is trickier than you'd think.
After all, the super balance you need depends on your living situation, your expected retirement age, and what type of retirement lifestyle you're aiming for.
Do you own your own house outright? Are you a single person or living as part of a couple? What type of travel do you expect to do after you finish working? Do you have any debts? What age do you want to retire?
Let's assume you're aiming for a comfortable retirement starting at age 67.
Here's a breakdown of what that could look like, what it could cost you, and how much superannuation you'd need.
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What does a comfortable retirement look like?
The Association of Superannuation Funds of Australia (ASFA) splits retirement into two broad categories: comfortable and modest.
ASFA defines a comfortable retirement as one that gives retirees a good standard of living well beyond the age pension. It budgets for expenses beyond a modest retirement, including top-tier private health insurance and regular leisure activities. It allocates funds for home repairs or renovations, and perhaps even an annual holiday.
Meanwhile, a modest retirement is defined as being able to cover expenses just slightly above what the full Centrelink Age Pension would provide from age 67.
How much is a comfortable retirement expected to cost?
A comfortable ASFA retirement is expected to cost around $55,923 per year for single Australians, and $78,566 for a couple living together.
These figures also assume you'll receive a part Age Pension, that you own your home in full, and that you already have an emergency fund set aside.
How much superannuation do I need at age 67 to afford that?
In order to fund a comfortable retirement, ASFA calculates that at age 67, single Australians will need around $630,000. Meanwhile, couples will need a superannuation balance of around $730,000.
How do I know if I'm on track to reach that balance by age 67?
I've crunched the numbers using ASFA's super detective tool to work out what superannuation balance you should have at each age milestone to be able to reach that goal.
At age 40, Australians should have a superannuation balance of around $178,000.
By age 45, this should be closer to $239,000.
At age 50, you'll want to have around $313,500 in your superannuation.
This should then increase to about $399,000 by age 55.
Aussies aged 60 should have close to $496,500.
By age 65, to remain on track, your total superannuation balance should be around $604,500.
Are you on track?
