ASFA Retirement Standard - Moneysmart.gov.au (2024)

FAQs

How much super do I need for $50,000 a year in Australia? ›

The average retirement savings for Australians varies widely based on age, gender, and lifestyle choices. According to the latest Australian Taxation Office Taxation Statistics report covering the 2021 financial year, the average superannuation balance for an Australian aged between 60 and 64 was $361,539.

According to EBRI estimates based on the latest Federal Reserve Survey of Consumer Finances, 3.2% of retirees have over $1 million in their retirement accounts, while just 0.1% have $5 million or more.

If you are retiring at age 65 and are comfortable with an annual retirement income of around $50,000 (single) or $64,000 (couple,combined), then $500,000 is enough to retire in Australia. If you would like a higher income or to retire sooner (or both!), then you would need more than $500,000.

Is $600k enough? As the table suggests, while $600k is generally sufficient for a comfortable retirement with annual spending up to $40,000, it may fall short if annual expenses exceed this threshold.

One of the questions asked was what salary you need to earn to be considered rich in Australia in 2023. It turns out that figure is anything over $250,000 – or an average of $303,000.

With that being said, what is a wealthy retirement? Well, according to ASFA, a comfortable retirement for a couple is around $72,000 per year and $51,000 for a single person. Given this, I would consider achieving a retirement income of, say, 30% over these amounts to be a wealthy retirement.

Income generated from a $700,000 retirement super balance

To put these numbers in context, the December 2023 ASFA standard for a comfortable retirement is $72,148 per year for a couple, while Super Consumers Australia's medium spending target is $69,000.

$1 million is enough for a comfortable retirement if you retire at age 65. This will provide a single person with an income of $60,000 p.a. and a couple with $77,000 p.a., including Age Pension for around 30 years, based on an investment return of 6% p.a. and 3.0% p.a. inflation.

Super wealthy (99th percentile): $16.7 million. Wealthy (95th percentile): $3.2 million. Well off (90th percentile): $1.9 million. Middle class (50th percentile): $281,000.

What does the average American retire with? ›

By age 40, you should have accumulated three times your current income for retirement. By retirement age, it should be 10 to 12 times your income at that time to be reasonably confident that you'll have enough funds. Seamless transition — roughly 80% of your pre-retirement income.

Previously, aspiring members of Australia's top 1% needed a net wealth of $US5. 5 million ($8.41 million). However, according to a 2024 wealth report by global real estate consultancy Knight Frank, this threshold has dipped to US$4.67 million ($7.18 million).

It's called the “sweet spot”, and it's where both singles and couples with a lower superannuation balance leverage the age pension alongside their superannuation income stream to earn more in retirement income than someone with a far larger superannuation balance can at the same drawdown rates.

If you retire at 60, with a super balance of $2 million, your chances of a comfortable retirement are high. Of course, that super won't last as long as if you retired at 70, because that money needs to last longer. Our retirement needs calculator can help you estimate your ideal retirement income and super.

“If you're earning A$150,000 a year or A$120,000 a year before you retire, then you might need A$70,000 or A$80,000 in retirement. But if you were earning A$50,000 beforehand, then you probably need A$35,000 to A$40,000 in retirement.”

If you make $100,000 a year living in Australia, you will be taxed $24,967. That means that your net pay will be $75,033 per year, or $6,253 per month. Your average tax rate is 25.0% and your marginal tax rate is 34.5%. This marginal tax rate means that your immediate additional income will be taxed at this rate.

ASFA estimates people who want a comfortable retirement need $690,000 for a couple, and $595,000 for a single person when they leave work, assuming they also receive a partial age pension from the federal government.