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How much money should I save for retirement? Superannuation targets explained

Unless you’ve got a firm retirement plan, it can be tricky to pinpoint your goal with superannuation. So let’s break it down: how much money do you need for retirement?

Firstly, what does retirement mean to you?

There are varying definitions of retirement. For some people, retirement is the time in their life when they stop working altogether. At the same time, others might transition to casual or part-time employment or use it as an opportunity to tick off life goals like international travel. 

Narrowing down your goals for retirement, regardless of money, can help you get a clearer idea of what you’re saving for. Discuss your priorities with relevant people, like your partner, family, or close friends so that everyone can get on the same page.

How superannuation impacts retirement

The purpose of a superannuation fund is to accrue a nest egg you can live off of during retirement. 

When you reach your fund’s preservation age (between 55 and 60, depending on your birth date), you’ll be able to access your super and live off the returns and balance as a retirement income, combined with other payments like age pensions, investments, or savings accounts. 

According to the Australian Bureau of Statistics (ABS), most retirees live off some combination of Centrelink age pension and super. 

Super income can come in multiple forms, such as:

  • An account-based pension.
  • A lump sum.
  • An annuity (yearly payment).

Retirees can also choose to have a combination of these payments as part of their retirement plan. 

Logically, the more money you accumulate in your super, the more you have to retire. Most Australians these days live well into their 80s or 90s, so if you plan to retire around age 60, you need to budget for 20 - 30 years of retirement.

How much money you need in your super will depend on your life circumstances and desires and budget items like living expenses, retirement plans, debt repayments, healthcare, and looking after loved ones.

How much super should I have ?

According to Super Consumers Australia, assuming you don’t pay rent or a mortgage, single people should plan to save between $88,000 and $745,000 for retirement, on top of whatever they expect to get from their age pension. Couples should plan to save $111,000 and $1,003,000. This is based on ABS spending estimates in retirement.

As a rule of thumb, Super Consumers recommends reaching (if not exceeding) these savings targets by age 55 to 59, giving you a bit of cushion just before your super preservation age. 

Where you want to fall within these ranges will depend on what you want your yearly income to be. The table below shows which balances correspond to which levels of income. 

Super Consumers Australia: Super savings targets before retirement

Fortnightly income
Yearly income
Super balance
Single (low)
Single (medium)$1,692$44,000$301,000
Single (high)$2,115$55,000$745,000
Couple (low)$1,846$48,000$111,000
Couple (medium)$2,462$64,000$402,000
Couple (high)$3,115$81,000$1,003,000

According to the Australian Taxation Office, as of June 2020, the average super balance by age 60 - 64 is $357,963 for men and $287,777 for women, both of which fall short of the mid-tier suggested target by Super Consumers. 

RELATED: Is your employer underpaying your super? Aussies reportedly owed billions

Not sure where you stand with your retirement goals? You can try MoneySmart’s retirement planner calculator to see how much income your super/pension could give you and how life decisions like your age, investment options, work schedule, and voluntary contributions affect your retirement.

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How to reach your retirement savings goals

Whatever your super savings goal, there are a few steps you can take to make sure you reach it by your preservation age. 

  • Consolidate your super accounts. Lost super is surprisingly straightforward to find again, and combining all your super funds into one helps reduce your exposure to fees while maximising your returns.
  • Ask your employer to contribute with your paycheck. At the moment, employers are only required to pay super quarterly, but this limits how much your balance is compounded. Negotiate with your employer, so they at least make contributions to your super monthly (or with your regular paycheck).
  • Make voluntary contributions. Got a nice bonus? Consider chucking into your super to help top up your balance. 
  • Compare super funds. Supers can vary as much as any other financial product, so it’s vital to compare funds till you find one you’re happy with – and switch supers when you do.

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Evlin DuBose
Evlin DuBose
Senior Money Writer

Evlin, RG146 Generic Knowledge certified and a UTS Communications graduate, is a leading voice in finance news. As Mozo's go-to writer for RBA and interest rates, her work regularly features in Google's Top Stories and major publications like