How much superannuation should I have for my age?
As of July 2014, employers have been required to contribute 9.5% into super, however individuals are able to contribute further.
Whilst there is no magic age to start planning for retirement, the simple answer is the earlier you start, the more chance you have to achieve the retirement you dream of. This really comes into play because of the compounding interest effect and how powerful it can be.
According to The Association of Superannuation Funds of Australia’s (ASFA) Retirement Standard, a couple expecting a comfortable retirement will need an average of $60,457 a year.
The longer a person has secured super contributions and associated investment earnings, the higher their account balance, especially over a significant period of time.
This is also why young people being illegally paid cash in hand for work should consider the implications of forgoing the superannuation contributions they’re owed, as it can put the size of their retirement nest egg at risk.
So, for my age, how much super should I have?
For the competitive among us, understanding the benchmark of how much others in our age group have saved for retirement through their super can be a useful reference guide. According to 2016 statistics released by the Australian Bureau of Statistics in the Survey of Income and Housing, the average superannuation balance by age is as below:
15 to 19 years $485
20 to 24 years $5,501
25 to 29 years $21,372
30 to 34 years $38,386
35 to 39 years $56,715
40 to 44 years $80,899
45 to 49 years $114,616
50 to 54 years $135,290
55 to 59 years $180,689
60 to 64 years $214,897
65 to 69 years $207,105
70 to 74 years $161,974
75 to 79 years $76,049
80 to 84 years $42,912
It is important to recognise the landscape of our current world and set your retirement goals realistically, while aiming high. If your super balance does need a boost, you can consider salary sacrificing, making personal tax-deductible contributions, after-tax or spousal contributions.
Talk to a professional
Well-meaning friends and family advice can only take you so far – when you have so much at stake, your future and your superannuation may benefit from the support and advice from a professional in the field. Consider talking to your trusted adviser about your financial situation and retirement goals.