How much is enough to retire?

Most of us daydream about the day we finally finish work and retire. Whether you dream of cruising around the world, or just pottering about in the garden, the magic question is: how much do you need to make your retirement dreams a reality?

One of the most important steps in planning to save for your retirement is figuring how much you will need to spend each year to live a comfortable lifestyle. However, many people struggle when it comes to developing a budget for their future needs, particularly when their retirement is many years away.

The Association of Superannuation Funds of Australia (ASFA) has developed a Retirement Standard that outlines the annual budget needed by the average Australian to fund a comfortable or modest standard of living in retirement. The Standard is updated four times a year to take into consideration the rising price of items like food and utility bills, as well as changing lifestyle expectations and spending habits.


Do you want a MODEST or COMFORTABLE retirement?

modest retirement lifestyle is considered better than living off just the Age Pension, but still only able to afford basic activities.

The superannuation balance needed for a modest lifestyle are:

  • For singles: $35,000
  • For couples: $50,000

These amounts are low because the base rate of the Age Pension (plus various pension supplements) is sufficient to meet needs at this budget level.

A comfortable retirement lifestyle enables an older, healthy retiree to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of such things as; household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.

The superannuation balance required for a comfortable retirement are:

  • For singles: $545,000
  • For couples: $640,000

These amounts assume that the retiree/s will draw down all their capital, and receive a part Age Pension.

Both budgets assume that the retirees own their own home outright and are relatively healthy.


Table taken from ASFA Retirement Standard.


How much will I spend in retirement?

As people age, their spending requirements change as they are often unable to engage in the same types of activities and require a higher level of care and support. This has an impact on their budget and what they spend.

  • Retirees spend more on: assistance in the home, including for cleaning services and meals, as well as contributions towards home and community care services. They also tend to have increased out-of-pocket expenses for major medical procedures and ongoing chemist and other medical expenses.
  • Retirees spend less on: holidays and other leisure activities outside the home, most likely reflecting their reduced capacity for activity.


Think about life expectancy

You might need a lot more money for your retirement than you think.

Many of us will spend more than a quarter of our life retired, as people are now living until an average age of 86 years (if you’re male) and 89 years (if you’re female). Life expectancy is expected to rise to 91 for males and 93 for females by 2050. Unless you’re counting on a lotto win or growing your own personal money tree, super can help you enjoy your retired days by allowing you to maintain a good standard of living, which isn’t achievable by receiving just the Age Pension.


Get financial advice

Planning for retirement is complex and it’s important to get advice from people with specialist knowledge. For financial advice on how you can maximise your money or to discuss your retirement planning, please book online or contact us on

It’s never too early to start thinking about how to maximise your income in retirement. Take steps now to get the best chance at the lifestyle you want.

Fortress Financial Solutions founder Chris Black is an award-winning financial planner based in Toowoomba who specialises in superannuation, investing, business succession, cash flow management, retirement planning and personal insurances (including life insurance, income protection, total permanent disability and trauma insurance).

Complied by Emma Linton Doig, Practice Manager at Fortress Financial Solutions.

Corporate Authorised Representative of Magnitude Group Pty Ltd ABN 54 086 266 202, AFSL 221557.

Information on this site may be regarded as general advice. That is, your personal objectives, needs or financial situations were not taken into account when preparing this information. Accordingly, you should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs before acting on it. Where the information relates to a particular financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product.

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