News, Culture & Society

Superannuation figure you need to retire and live a ‘comfortable’ life and what $545k will get you

The ‘terrifying’ figure needed to live a ‘comfortable’ life in retirement has been revealed as Australians become increasingly anxious they won’t have enough superannuation to retire on. 

Single Australians need at least $545,000 while couples need at least $640,000 in savings according to the Association of Super Funds Australia (ASFA).

ASFA states a ‘comfortable’ retirement means being able to afford private health insurance, TV and streaming services, a reliable car, home repairs, regular trips to restaurants and the cinema and professional haircuts. 

The data found that retirees with at least $545,000 in savings can enjoy one domestic trip per year and one overseas trip every seven years. 

Comparatively, retirees who can only afford a ‘modest’ retirement with $70,000 in savings can expect one domestic trip each year and a ‘few short breaks’. 

A ‘modest’ retirement means ‘infrequent’ trips to the cinema and takeaway meals, a limited budget for home repairs and a cheaper and older car. 

The ‘terrifying’ figure needed to live ‘comfortably’ in retirement has been revealed as Aussies grow increasingly anxious about having enough super to retire on (stock image)

Average super savings by age group

25 to 29: $21,309

30 to 34: $44,650

35 to 39: $74,963 

40 to 44: $108,217

45 to 49: $145,622

50 to 54:  $188,234

55 to 59: $246,771

60 to 64: $323,871

65 to 69: $383,367

70 to 74: $422,112

Source: Australian Taxation Office data for 2019-20 

For retirees on the government’s Aged Pension, short breaks are reduced to a day trip in their own city with only ‘local club special meals’ and inexpensive takeaway in their reduced budget. 

The ASFA data is based on assumptions retirees own their homes outright and are relatively healthy. 

Perth-based Investor Natasha Etschmannn said it was ‘pretty terrifying’ single Aussies needed $545,000 to retire comfortably.

The accounts manager, who regularly posts videos sharing tips on saving and investing money, took to TikTok to share ASFA’s expenses breakdown. 

‘This is a pretty terrifying number for a single if your partner passes away and you don’t own your own home as well,’ she said. 

The figures come as a growing number of Aussies become increasingly anxious they will not have enough superannuation to retire on. 

New research has revealed workers typically believe they will be $200,000 short, with data from AMP finding 70 per cent of women were worried about insufficient retirement savings compared with 56 per cent of men.

The AMP report showed women aged 50 to 59 were particularly worried about higher costs of living. 

AMP found Australians typically believed they needed $600,000 to retire on but only expected to have $400,000 saved up (stock image)

AMP found Australians typically believed they needed $600,000 to retire on but only expected to have $400,000 saved up (stock image)

Surging inflation and cost-of-living pressures are heightening retirement anxieties, leading to fears Aussies are ‘unnecessarily compromising quality of life’.

AMP found Australians typically believed they needed $600,000 to retire on but only expected to have $400,000 saved up. 

The latest Australian Taxation Office data shows people aged 65 to 69 had an average superannuation balance of $383,367.

That represents an average shortfall of $151,633 for Aussies at or approaching retirement age, based on the recommended superannuation balance.

Bestselling author Scott Pape, known as the Barefoot Investor, is a critic of superannuation industry retirement targets.

A growing number of Aussies are becoming increasingly anxious about not having enough superannuation to retire on - with $545,000 needed to retire 'comfortably' (stock image)

A growing number of Aussies are becoming increasingly anxious about not having enough superannuation to retire on – with $545,000 needed to retire ‘comfortably’ (stock image)

‘For far too long the super industry has played to the millionaires in the members’ stand,’ Pape told his followers last month.

Pape has instead endorsed a recommendation from Super Consumers Australia, which believes $258,000 is enough for an individual who has paid off their home. 

The tax office data showed average superannuation balances, across all adult age groups, of $145,388.

Those in the 55 to 59 age bracket had an average balance of $246,771 compared to $108,217 for those aged 40 to 44, and $323,871 for those aged 60 to 64.

The Reserve Bank of Australia is expecting inflation in 2022 to hit a 32-year high of 7.75 per cent, in bad news for households already battling rising cost of living prices. 

***
Read more at DailyMail.co.uk