If you haven't checked your superannuation balance in a while, it's worth taking a look.
You may be in for a pleasant surprise.
That's because last year, the median Australian growth superannuation fund delivered an outstanding total return (capital growth plus dividends) of 11.4%.
That sensational jump came on top of an average 9.9% total return in 2023.
So, we're talking more than 20% growth in super savings in just two years.
Fantastic!
But are your super savings on track for your age?
Let's find out.
How are you going with superannuation savings?
Let's start with the end goal.
According to the AFSA Retirement Standard, singles need $595,000, and couples need $690,000 in superannuation savings by age 67 to fund a 'comfortable' retirement.
AFSA defines a 'comfortable' retirement as being able to pay for the essentials plus lots of extras.
They include private health insurance, a variety of exercise and leisure activities, occasional restaurant meals, a domestic trip once per year, and an overseas trip every seven years.
Here's what you need in your super account today to achieve this lifestyle.
If you're 25 (thus born in 2000), your superannuation balance should be $18,500.
If you're 30 (thus born in 1995), your superannuation balance should be $59,000.
If you're 35 (thus born in 1990), your superannuation balance should be $101,500.
If you're 40 (thus born in 1985), your superannuation balance should be $156,000.
If you're 45 (thus born in 1980), your superannuation balance should be $213,000.
If you're 50 (thus born in 1975), your superannuation balance should be $281,000.
If you're 55 (thus born in 1970), your superannuation balance should be $361,000.
If you're 60 (thus born in 1965), your superannuation balance should be $453,000.
If you're 65 (thus born in 1960), your superannuation balance should be $549,000.
Are you aged somewhere in between?
You can find out exactly how much you should have in superannuation today by going to the Super Guru website's Super Balance Detective Calculator and entering your year of birth.
Now, a word of caution…
The AFSA Retirement Guide's recommendation of having $595,000 in super for singles and $670,000 for couples has a few caveats.
That recommendation assumes you will own your own home without a mortgage by age 67.
It also assumes you will receive a part-age pension from age 67.
To receive a pension, you need to pass an asset test (that excludes the value of your home) and an income test.
Essentially, if you don't own too much or earn too much, you'll get at least a part pension.
The AFSA figures also assume you will receive an average 6% per annum total return on your superannuation savings balance during retirement.
So, it won't be enough to simply stash your cash in a savings account. You'll have to be invested, at least conservatively, to achieve an average 6% return on your super savings.
