Everyone has their own dreams of how retirement might look. How much super will be enough depends on a variety of factors.
You may plan to travel and love dining out. You may want the capacity to help support your children and grandchildren. You may just want to relax without any money worries. Then there are one-off or unexpected costs to consider, like a new vehicle or retirement village fees. You may also need to account for health issues that may arise.
So how do I work this out?
It's vital that you start thinking about your retirement early. So how do you work out what you may need? The Association of Superannuation Funds of Australia’s Retirement Standard is one online resource that offers some guidelines. They estimate that for retirees aged 65-84 a single person who wants a ‘comfortable’ lifestyle will need to account for an annual living cost of $46,494*.
While for couples a ‘comfortable’ lifestyle is anticipated with annual living costs of $65,455, with both circumstances taking into account you own your home outright*.
*March Quarter 2022.
What about inflation?
As the cost of living goes up each year and things get more expensive, the calculations for how much you’ll need in retirement are adjusted.
Can I rely on the Aged Pension?
Again, this will depend on your needs. The maximum rate for the Age Pension (without supplements) is $21,222 annually for a single person or $31,995 annually for couples*.
This will limit your retirement lifestyle choices and you may need to put extra money into your super.
*March Quarter 2022.
Can I contribute to my super to boost my retirement fund?
Yes! Contributing to your super is an ideal way to boost your retirement funds. There are tax limitations to be aware of and Proactive Tax & Business Services can guide you.
Start calculating...
Head to the ASFA Retirement Tracker Calculator where you’ll be able to find out how much super will be enough for you in retirement. Start working it out now!
Need advice? Contact one of our friendly team members today. Call 03 5775 2713.
Please note: The information in the above post is general in nature and should not be relied upon as detailed advice that applies to all. Consult a qualified advisor for detailed retirement and financial planning advice.
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