May 3, 2024

How much do you need to retire?

A new survey reveals Australians frequently overestimate how much they need to have saved to fund a comfortable retirement. So how much do you need exactly and can you retire sooner than you thought? Here we explore those questions and explain how you can be better financially prepared for retirement…

New clients often ask how much money they need to save before they can retire. Our answer is always the same, ‘it depends.’ This is because everyone has different needs and goals, and it’s only once we’ve explored those can we give a definitive answer. It is however, perhaps less than you think you might need…

In fact, a survey recently conducted by Colonial First State, revealed that unretired Australians believe $1.6 million is the amount required, on average, to fund a comfortable retirement.1 This figure far exceeds the $595,000 super balance required for a comfortable retirement at age 67 (for a single person) recommended by the Association of Superannuation Funds of Australia (ASFA).2

According to ASFA, this comfortable retirement standard should allow a retiree to maintain a good standard of living. It accounts for daily essentials, groceries, transport and home repairs, exercise and leisure activities and the occasional restaurant meal. It also allows for an annual domestic holiday and an international trip once every seven years.3

This is obviously a generalisation as everyone has a different definition of the word ‘comfortable’ and unique circumstances. However, the statistics are good food for thought. It’s nice to know that you could very well retire comfortably on less than you thought – and perhaps sooner than you originally imagined.

But I have particular goals I want to accomplish and things I want to be able to do in retirement – when can I stop working?

A key focus of ours at 5 Financial is giving clients clarity and peace of mind. We focus on your unique goals and situation, which allows us to set an appropriate wealth target for you across your superannuation and investment portfolio.

Perhaps you want to be able to help set your kids up financially or go to Europe every Christmas to visit family. Perhaps you’d like to take up an expensive new hobby in retirement or go sailing around the world. You’ll want to spend your retired years relaxed, happy and free to do the things that make life enjoyable – and we want that for you too.

Our clients are never left second guessing when it comes to retirement planning. More often than not (as the statistics suggest), clients need less to retire on than they originally considered, particularly when their savings are structured correctly. But our expert Financial Advisers can help you identify exactly how much you need to save before you stop working, to help you retire comfortably – whatever that looks like to you. We’ll also arm you with the strategies and tools needed to help you save that money, and help you structure your finances to best support your retirement goals.

Call today on (02) 9739 6555 to begin the journey towards your relaxed and happy retirement.




Please note, the above information does not constitute financial advice and does not take into account your current circumstances or goals. Please speak with a Financial Adviser before acting on any information found here or throughout the 5 Financial website.

return to News & Insights