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Financial Planning  |  1/02/2017  |   3 min read

Question.

I’ve seen newspaper reports that you need $1 million in superannuation to retire comfortably. I’m well short of that, and worried that I won’t have enough to live on.

Answer.

There’s been a lot of discussion about how much you need for a comfortable retirement, with some organisations suggesting that $1 million should be the new national benchmark.

The reality is most Australians will retire with far less, and still enjoy a very comfortable lifestyle.
According to the ASFA standard (Association of Super Funds of Australia), the average couple needs $640,000 in savings for a comfortable retirement. For individuals that number is $545,000. 

While everyone’s circumstances and spending habits vary, ASFA’s definition of comfortable and modest lifestyles is outlined below. These equate to approximately $60,000 per annum for couples and $43,000 for singles. It is assumed you own your own home outright.

ASFA-Standard.jpg

Chart supplied via ASFA

You can check your own projected balance with Equip’s Retirement calculator. But even if you’re coming up short, there are a number of things you can do to boost your balance. As long as you’re still working and contributing to your super you have options available. Some of the immediate actions you can take include.

1. Try different contribution and investment strategies on Equip’s retirement calculator to see how they’ll impact your retirement income. 

2. Talk to your employer about salary sacrificing. Your accounts department or payroll team can take care of the details, just let them know how much extra you’d like to contribute. 

3. Speak to a financial planner about your situation and learn more about your options. You can also explore automated retirement products such as Equip MyPension, which reinvests your super while paying you an annual income.   

 

This information is provided for general information only. It does not take into account your personal objectives, financial situation or needs and should therefore not be taken as personal advice. You should consider whether it is appropriate for you before acting on it and, if necessary, you should seek professional financial advice. Before making a decision to invest in the Equipsuper Superannuation Fund, you should read the relevant Equip Product Disclosure Statement (PDS). Past performance is not an indication of future performance. Issued by Equipsuper Pty Ltd ABN 64 006 964 049 AFSL 246383.   

Check your retirement income with the Equip calculator