{"id":7721,"date":"2022-11-07T12:03:56","date_gmt":"2022-11-07T01:33:56","guid":{"rendered":"https:\/\/adelaideprivatewealth.com.au\/how-much-super-do-i-need-to-retire\/"},"modified":"2022-11-07T12:03:56","modified_gmt":"2022-11-07T01:33:56","slug":"how-much-super-do-i-need-to-retire","status":"publish","type":"post","link":"https:\/\/adelaideprivatewealth.com.au\/how-much-super-do-i-need-to-retire\/","title":{"rendered":"How much super do I need to retire?"},"content":{"rendered":"
\n

Working out how much you need to save for retirement is a question that keeps many pre-retirees awake at night. Recent market volatility and fluctuating superannuation balances have only added to the uncertainty.<\/strong><\/p>\n

So it\u2019s timely that new research shows you may need less than you fear. For most people, it will certainly be less than the figure of $1 million or more that is often bandied around. <\/p>\n

For most people, the amount you need to save will depend on how much you wish to spend in retirement to maintain your current standard of living. One way of doing that is to look at how much you spend now. <\/p>\n

When Super Consumers Australia (SCA) recently set about designing retirement savings targets they started by looking at what pre-retirees aged 55 to 59 are actually spending.<\/p>\n

\"\"<\/p>\n

Retirement savings targets<\/h3>\n

As you can see in the table below, SCA estimated retirement savings targets for three levels of spending \u2013 low, medium and high \u2013 for recently retired singles and couples aged 65 to 69. <\/p>\n

Significantly, only so-called high spending couples who want to spend at least $75,000 a year would need to save more than $1 million. A couple hoping to spend $56,000 a year would need to save $352,000. High spending singles would need $743,000 to cover spending of $51,000 a year, and $258,000 for medium annual spending of $38,000.i<\/sup><\/p>\n

Table: Savings targets for current retirees (aged 65-69)<\/strong><\/p>\n

\"\"\u00a0<\/p>\n

Source: Super Consumers Australia<\/a><\/span><\/p>\n

While these savings targets are based on what people actually spend, there is a buffer built in to provide confidence that your savings can weather periods of market volatility and won\u2019t run out before you reach age 90. <\/p>\n

They assume you own your home outright and will be eligible for the Age Pension (which is reflected in the relatively low savings targets for all but wealthier retirees), and also make assumptions about future inflation and investment returns.*<\/sup><\/p>\n

Retirement planning rules of thumb<\/h3>\n

The SCA research is the latest attempt at a retirement planning \u2018rule of thumb\u2019. Rules of thumb are popular shortcuts that give a best estimate of what tends to work for most people, based on practical experience and population averages. <\/p>\n

These tend to fall into two camps:<\/p>\n