Knowing how much you need in retirement is more about knowing what kind of lifestyle you desire when you have retired, or, transitioning to retirement.
According to the ASFA Retirement Standard, for a single person that magic number is $545,000.
But according to the ABS – the average super balances for the entire working population1 would suggest that we are not even close to that mark, however, a closer look into the average balance by age group reveals that the average balance for men between 55-59 is $237,022 and for women it is $123,642.
So how can we boost our super balance?
When every dollar counts, here are a few sneaky ways to squirrel up your super balance;
- Make sure you’ve consolidated all of your super2 so to save on incurring multiple fees across multiple accounts. Just keep a careful eye on any nasty exit fees.
- We nearly all have super guarantee provided by our employer3, but also consider forcing yourself to top up that contribution by way of salary sacrificing – think of it as mandatory savings!
- If your employer does not offer salary sacrificing, or you are self employed, consider personal tax-deductible (pre-tax4) contributions
- Make some personal (after-tax5) contributions to your super and if you’re eligible, you may even get a small bonus from the government in the form of a co-contribution payment.
- If your partner earns less than $40,000, then you may be able to claim a personal spouse tax offset by contributing to their super account.
If you currently don’t have a plan on reaching your desired retirement balance, then make one!
The easiest way to start is by jumping on to the ASIC moneysmart website. If you require any help, then please do not hesitate to reach out to us.
- As at the 2015 -16 financial year, according to the ABS, the average superannuation balance for men was $111,853 and $68,499 for women. But amazingly it’s estimated 1 in 3 men and 1 in 4 women don’t have any super at all (yikes!), and so if we remove those who have no superannuation balance at all, the average balance is $153,000 for men and $102,000 for women.
- Don’t forget to make sure you consider your default insurance cover within those accounts as well!
- Super guarantee is legislated to increase to 12%, although it is currently paused at 9.5% until at least 2021.
- Just be aware that there is a $25,000 limit and this includes the contributions made by your employer.
- The annual limit is $100,000, but be cautious and seek advice if your total super balance is approaching $1,600,000.