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Is My Superannuation Enough?

Retirement is always on the horizon. As citizens we hope that our government pensions will provide enough money to allow us a comfortable retirement. Unfortunately that is not the case for majority of Australian Citizens. Life expectancy has gradually increased over the last century. This is a double-edged sword. While women living to 82 and men to 77 will allow more time to enjoy our lives, we must keep in mind that it will mean that our superannuation pension must stretch further than ever before.  

How Money Much Do You Need For Retirement?

Bills don’t stop rolling in after you retire. Retirees will need to pay for rent, utilities, medical bills, auto insurance, and food. And that’s before adding in the entertainment that we hope that we can engage in after we retire. Current retirees who are fine with living a modest lifestyle will need:

  • ·         $21,930 a year if they live alone
  • ·         $31,675 if they live with a spouse.

Current retirees who are fine with living a modest lifestyle will need:

  • ·         $40,407 of they live alone
  • ·         $55,249 a year if they live with a spouse.

How Much Money Will Be Available to Us in Superannuation?

The amount of superannuation that seniors will receive is not a set amount because 9% of every paycheck that they have received over their lifetime been placed in their superannuation account. According to a study on retirement income conducted by Challenger, retirees will require over $600,000 if they want a comfortable retirement. Unfortunately the amount of superannuation that a lower or middle-class man or woman can expect is far lower. Current retirees have an average superannuation of:

  • ·         $275,800 if they are men.
  • ·         $218,600 if they are female.

This number will of course fluctuate based on when you began working, how much you earned throughout your life, and if you took any time off work. But the fact remains that the majority of lower and middle class Australians will have used their superannuation fund within 10 to 15 years.

The Answer to the Superannuation Problem?

I’m not sure what we can do as a nation to solve the retirement fund crisis that many of our seniors are currently experiencing. But we can make some personal changes to our own lives to ensure that our retirement funds will stretch a little further. You can do this by adding to your superannuation fund or creating a personal retirement savings account.

Before beginning to add money to tour superannuation or savings account, you should determine how much you will need to add to your retirement fund. You can do this by checking out this superannuation calculator here. To use the calculator you will need to know how much you currently have in superannuation and your yearly income. Once you have entered that data, the calculator will tell you how much you will have at retirement, when those funds will run out, and how much you will need to save to have the lifestyle you desire. All that is left is to work out how much you can afford to put towards your retirement now.

If you want a worry free and work free retirement, you need to carefully plan out your finances. Don’t expect your superannuation funds to provide all the support you desire. You may need to contribute money to your retirement fund. You can increase the amount you can add to your retirement fund with these money saving tips!

General Advice Warning

This information is of a general nature only and is not intended as financial planning, superannuation or investment advice. You must make your own assessment as to the suitability of products and/or strategies in respect of your own particular circumstances, objectives and needs. Before you make any investment decision, ensure that you have read the relevant product disclosure documents. We always recommend that you seek your own professional financial planning and superannuation advice.

 

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