Your superannuation will make a big impact on the kind of lifestyle you'll be able to afford once you retire. So, regardless of how far off retirement is for you, it's a good idea to keep an eye on your super balance and be proactive if it's below where you'd like it to be.
The Association of Superannuation Funds of Australia (ASFA) has estimated how much money you'll need in retirement, based on your preferred lifestyle.
Budgets for various households and living standards for those aged around 65 (June quarter 2021, national)
| Modest lifestyle|| Comfortable lifestyle|
| Total per year||$28,514||$41,170||$44,818||$63,352|
Source: ASFA. Notes: The figures in each case assume that the retiree(s) own their own home and relate to expenditure by the household. This can be greater than household income after income tax where there is a drawdown on capital over the period of retirement.
ASFA figures show that the amount you should have in your super when you retire to support a comfortable retirement lifestyle is $640,000 for a couple and $545,000 for a single person - assuming a partial Age Pension.
Meanwhile, ASFA estimates that a modest retirement lifestyle is mostly covered by the Age Pension. In which case the amount of superannuation needed to support a modest retirement lifestyle for a single or couple is $70,000.
According to ASFA, a modest retirement lifestyle is "considered better than the Age Pension, but still only able to afford fairly basic activities", while 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".
If you plan to retire at 65, it's important to keep in mind that you'll likely need a retirement income for at least 20 years.
Parents who have taken time out of the workforce to care for children, as well as low income earners, will tend to have less superannuation than those who have been employed continuously, on an average to high income, for the four or five decades of their career. If this is the case for you, you may want to consider making voluntary contributions on top of the super guarantee if your budget allows.
Moneysmart's retirement planner calculator can help you calculate the income you're likely to get from super and the age pension when you retire, based on your personal financial details.