How much superannuation do you really need in retirement?

Let's see if you really need $1 million for a comfortable retirement.

Couple holding a piggy bank, symbolising superannuation.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

One of the biggest financial questions that Australians face is how much superannuation they need to retire comfortably.

While the oft-cited figure of $1 million may seem like an ideal target, the reality is that there is no universal answer.

Retirement needs vary based on lifestyle choices, personal circumstances, and access to additional income sources such as the Government Age Pension.

The reality of super balances in Australia

Despite the perception that a seven-figure super balance is necessary, most Australians are retiring with much less.

According to the Australian Tax Office, courtesy of Australian Super, the median superannuation balance for individuals aged 60–64 is $211,996 for men and $158,806 for women. While these figures may seem low compared to some retirement estimates, the Age Pension serves as a financial safety net for those with insufficient savings.

However, relying solely on the Age Pension may not provide the level of comfort many aspire to in their retirement years.

This makes it very important to have a retirement savings goal that aligns with your personal expectations and lifestyle aspirations.

A comfortable retirement

A great starting point in figuring out how much superannuation you will need is to understand what a comfortable retirement looks like for you.

For some, retirement might involve extensive travel and frequent social outings, while for others, it could mean a quieter lifestyle focused on spending time with family and pursuing hobbies.

The Association of Superannuation Funds of Australia (ASFA) provides a benchmark for two types of retirement lifestyles:

  • Comfortable lifestyle – Allows for a good standard of living, including private health insurance, regular leisure activities, and occasional travel.
  • Modest lifestyle – Covers basic living costs, including essential expenses and some leisure activities, but with limited discretionary spending.

How much super do you need?

ASFA estimates that for a comfortable retirement, retirees will need the following super balances at age 67:

  • Single person: $595,000
  • Couple: $690,000

Whereas, for a modest retirement, retirees require significantly less:

  • Single person: $100,000
  • Couple: $100,000

It is worth noting that these figures assume homeownership and do not factor in rental costs, which could significantly impact the amount needed.

How much do you need annually?

According to ASFA's Retirement Standard, retirees will need the following annual budgets:

  • Comfortable lifestyle: $73,031 per year for a couple, $51,814 per year for a single person.
  • Modest lifestyle: $47,475 per year for a couple, $32,930 per year for a single person.

By comparison, the Age Pension provides a much lower annual income, which reinforces the importance of having superannuation savings to supplement government support.

Planning for your ideal retirement

There are several factors to consider when determining how much super you'll need:

  • Your desired lifestyle – Do you plan to travel frequently or live a simpler, budget-conscious life?
  • Additional income sources – Investments, part-time work, and the Age Pension can supplement your super.
  • Extra contributions – Making voluntary contributions can help grow your super balance over time.

Foolish takeaway

While the ideal superannuation balance for retirement will vary for each individual, having a clear goal based on your desired lifestyle is essential.

Understanding how much you need and planning early can make a significant difference in ensuring a financially secure and enjoyable retirement.

Whether aiming for a comfortable or modest lifestyle, taking proactive steps now can help you achieve greater financial independence in your later years.

Should you invest $1,000 in Splitit Payments right now?

Before you buy Splitit Payments shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Splitit Payments wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Superannuation

Couple holding a piggy bank, symbolising superannuation.
Superannuation

Here's the average Australian superannuation balance at age 50

Are you on track for a comfortable retirement? Let's dig into the numbers.

Read more »

A mature age woman with a groovy short haircut and glasses, sits at her computer, pen in hand thinking about information she is seeing on the screen.
Superannuation

AustralianSuper sticks with US stocks despite recent turmoil

AustralianSuper’s head of international equities says they won't be shifting focus to Europe.

Read more »

a couple clink champagne glasses on board a private aircraft with gourmet food plates set in front of them. They are wearing designer clothes and looking wealthy.
Superannuation

Superannuation and Wealth: The path of Australia's top earners

Here's the latest findings.

Read more »

An elderly man holds his chin in concern as he looks at his laptop screen.
Superannuation

How do super funds manage volatility?

Volatility can be scary, but it isn't always bad.

Read more »

A green-caped superhero reveals their identity with a big dollar sign on their chest.
Superannuation

Should you set up an annuity in your superannuation?

Would you get more value by investing some of your hard-earned money into an annuity during retirement?

Read more »

A happy elderly man wearing a red cape smiles as he jumps up like a hero from a massage table.
Superannuation

Is my superannuation on track?

Here's how much superannuation you should have at your age right now to fund a comfortable retirement later.

Read more »

man and woman discussing superannuation
Superannuation

How is superannuation taxed in Australia?

Want to add or withdraw from your super? Here’s how you will be taxed. 

Read more »

A retiree relaxing in the pool and giving a thumbs up.
Superannuation

How much superannuation do I need to retire at 60 in Australia?

Looking to retire at 60? Here’s a guide on how much super you might need.

Read more »