The Australian dream is to retire early (at least by 50) and then spend the rest of travelling to exotic places, but do you know how much you need to retire comfortably. And what do the experts define as a comfortable retirement?

Did you know that according to the Australian Financial Services Council (FSC), our nation is facing a $2 TRILLION dollar gap in retirement income? That’s the difference between your expenses and your actual income. This is the reason Australians are working longer in life, drumming up side hustles and looking for ways to boost their retirement savings. However, retirement isn’t on the radar for most of us under 30. We feel young, invincible and ready to take on the world. It’s only once you hit your mid-forties and start hearing how much experts predict you’ll need to live comfortably, that we start panicking and worrying that perhaps if we don’t win Powerball, life as a pensioner looks a little bleak.

How much you need for retirement isn’t an easy question to answer. It depends on how long you live and what you want your retirement to look like.

The Australian Super Fund Association suggests $65,000 is ample for a comfortable requirement with comfortable defined as enough money for those who are mortgage-free, have no major medical problems and are able to afford the odd extracurricular activities. With the rising cost of inflation, doesn’t equate to a life of sun-seeking across the globe.

Calculating your super annuation balance for retirement

To figure out how much superannuation will allow a comfortable retirement, you need to consider the following checklist. You may not be able to provide an exact answer, but an average will give you some idea if you are on the right track.

1)When are you planning to retire?

2) Are you in a relationship?

3) Are you going to continue working and if so, how long?

4)  What are you spending habits like?

5) Do you have any assets?

6) Are you eligible for the pension?

7) How much do you have saved in super?

8) Do you own your own house?

9) Are you reasonably healthy?

10) Do you plan to travel?

11) Do you have children you want to help out?

Let’s just say that if you want to retire in your 50s, you’re going to have to work and perhaps contribute voluntary payments through salary sacrificing or set up some investments to ensure you have enough money for a comfortable retirement. The average lifespan for Australian men is mid-eighties, while for women is slightly longer. So if your goal is to retire at 50 years of age and your family tends to live well into their nineties, you’ll need enough money to keep you going for approximately 30-40 years.

It’s often cheaper for two people to split the costs of retirement than for one person to bear the brunt of the financial burden alone. Not only is going on a cruise as a couple cheaper, everything from loan repayments to having an extra pair of hands around the house becomes easier because you don’t need to get in-home help to assist with housework

If you need more help planning for retirement or setting up investments so that you can live an opulent retirement, please contact our team today. We can connect you with a financial expert who can assess your financial situation and educate you on ways you can grow your super.