How much extra money you contribute to your super depends on what you’ll need to live off once you retire. The amount of super you need depends on:
The table below will give you a rough idea of how much money you need to support a modest or comfortable retirement. It applies for people retiring at age 65 who will live to an average life expectancy of about 85. It assumes you own your home.
|ASFA Retirement Standard||Annual living costs||Weekly living costs|
|Couple – modest||$34,560||$663|
|Couple – Comfortable||$59,619||$1,143|
|Single – Modest||$23,996||$460|
|Single – Comfortable||$43,372||$832|
Another way to estimate how much money you will need in retirement is to assume you need 67% (two-thirds) of your income before you retire in order to maintain the same standard of living in retirement. This estimate is only suitable for above average income earners.
ASFA estimates the lump sum needed to support a comfortable lifestyle for a couple is $640,000 (or $545,000 for a single person) assuming a partial Age Pension. ASFA also estimates that because a modest lifestyle is mostly met by the Age Pension the lump sum required to support it for a couple is $35,000 ($50,000 for a single person).
At Acuity Advisers we can run detailed financial models to provide you with comfort around your retirement planning and ensure that you are taking advantage of any opportunities that may be available to you. Contact us for an initial consult – Enquiries@AcuityAdvisers.com.au or 9322 1481.