Is your super on track?
How much super do you need? Do you have enough? Will you have enough?
These are the most common questions we get asked. The answer's a personal thing. What's enough for one person will differ for another. The Association of Superannuation Funds of Australia (ASFA) provides a guide for how much a person needs for a modest or comfortable lifestyle in retirement.
ASFA considers that a comfortable lifestyle in retirement means you can have an annual holiday in Australia, eat out, buy good clothes and own a reasonable car.
If this sounds like what you'll want when you finish work then it's a good starting point for what you'll need saved in your super. If you think you'll want to do more (such as travel overseas every year), you'll need to save more.
Are you on track?
ASFA says to fund a comfortable retirement as a couple you'll need $690,000^ saved in your super. For a single person you'll need $595,000. TelstraSuper Financial Planning has provided a guide for how much you may need depending on when you want to retire and your annual income needs in the table below.
A great way to see how your savings are tracking is to try our super savings calculator. It'll give you an estimate of how much money you'll have saved when you retire.
See how much you'll have when you retire
Below table shows the balance required at retirement age for specified desired income untill age 90.
|
Retirement age* |
60 | 65 |
| Annual Income | ||
| $25,000 | $530,000 | $465,000 |
| $30,000 | $635,000 | $560,000 |
| $35,000 | $740,000 | $655,000 |
| $40,000 | $850,000 | $745,000 |
| $45,000 | $955,000 | $840,000 |
| $50,000 | $1,060,000 | $930,000 |
| $55,000 | $1,165,000 | $1,025,000 |
| $60,000 | $1,270,000 | $1,120,000 |
- single investor purchases a retirement income stream like TelstraSuper RetireAccess® and this is their only taxable income
- investor doesn't convert any part of their income stream to a lump sum or make additional contributions after retirement
- calculations are based on a 'real' rate of return of 2.5% p.a. after 2.5% inflation (total return of 5% pa)
- taxation has been taken into account on the basis that the payments from superannuation are not taxed after age 60
- these amounts are within the annual income limits permitted by the Government
- the figures in the table are based on a full financial year and are applicable at the commencement of an income stream
- payments are indexed by 2.5% each year
- Figures are rounded to nearest $5,000
- lump sums represent amounts required today at these ages to provide the stated income to age 90 with no residual capital remaining. Future performance is not guaranteed. Figures are an estimate only.
How you can achieve your goals
Once you know how much money you'll need each year in retirement, there are several things to consider when looking at how to achieve your goals:
- when you want to retire and how long your income needs to last
- your tolerance to investment risk
- whether you may be eligible for Government assistance
- other assets, and any lump sum withdrawals you are planning to take from your super.
What to do if your balance is lagging
If you think you need to boost your super, there are a couple of simple things you can do:
- make extra contributions
- find any extra super accounts you may have
- roll all your money into one super fund
- review your investment options.
Need help getting your super on track?
At TelstraSuper we’re here to help you build a secure financial future. TelstraSuper Financial Planning Advisers can help you get your super on track. If you’d like to discuss growing your super or your super account contact us on 1300 033 166 or by filling in our online contact form.
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