ASFA lays out comfortable retirement numbers

As long as you own your own home and are in reasonable health, a single person needs $43,694 a year and a couple needs $60,063 to be comfortable in retirement, according to the latest research released by the Association of Superannuation Funds of Australia (ASFA).

It said this equated to retired singles needing $545,000 in superannuation and couples needing $640,000 to be comfortable, assuming that all capital will be drawn down and at some point receve the part age pension.

Commenting on the research, ASFA chief executive, Dr Martin Fahy said dream retirements were in reach for many people thanks to compulsory super and the gift of compound interest.

“Someone currently 30 years old, earning $70,000 per year with 9.5 per cent Superannuation Guarantee (SG) and lifting to 12 per cent by 2025, is well on track to reach the ASFA comfortable standard of living by the time they retire at 67 if they have $50,000 in their super today,” he said. “At later ages there can be more catching up to do.”

“In order to achieve the comfortable standard in retirement, a forty-year-old needs at least $175,000 in their super today. A fifty- year-old needs $275,000 and a sixty-year-old needs $425,000.”

Fahy said despite the naysayers, super was setting up current generations of workers for comfort in retirement.

“A lift in the SG to 12 per cent sooner rather than later would mean the great promise of compulsory super would be even more sure,” he said.