Many of us will spend more than a quarter of our life as retirees.*
Whether your retirement is just around the corner or miles down the road, it’s never too early to start preparing.
Planning for retirement is the best thing you can do to make sure you have enough when you stop working. Here are some tips to get started.
Set some financial goals
Everyone’s retirement needs and goals are different. It’s important to consider your personal circumstances preparing for your ideal retirement. Start by asking yourself a few questions:
How much super will I need?
How long will I need my retirement savings to last?
What expenses will I face in the future?
What kind of lifestyle do I want?
Am I eligible for the government’s Age Pension?
What can I do to boost my super?
How much super do I need to retire?
How much super you need depends on several factors such as how long you will live, the type of lifestyle you want, and any future medical cost etc.
According to the ASFA Retirement Standard, single people will need about $545,000 in retirement savings to have a ‘comfortable’ retirement. Couples will need $640,000.
A comfortable retirement means being able to afford good clothes, enjoy occasional overseas holidays, owning a reasonable car, and access top level private health insurance etc.
Here is a breakdown of the yearly income required to have a comfortable or modest lifestyle in retirement.
Budgets for various households and living standards for those aged around 65 (as at March 2020)+
$28,220 per year
$40,719 per year
$44,183 per year
$62,435 per year
+The figures in each case assume that the retiree(s) own their own home, have no major health issues, and relate to expenditure by the household. This can be greater than household income after income tax where there is a drawdown on capital over the period of retirement. Source: ASFA Retirement Standard
For more information about retirement living costs, see ASFA or MoneySmart.
Find out how your super is tracking
To plan ahead you need to know how your super is tracking now. Super & retirement calculators give you an overview of how much your super could provide in retirement. They also let you calculate how much extra you can save by making regular voluntary contributions into your account.
There are a lot of things to consider when retiring. Speaking to a qualified financial planner can help you get all your ducks in a row. Apart from sorting your super, you can also discuss any Government entitlements, like the Age Pension, and work out how to structure any assets and investments outside of super to help maximise your retirement entitlements.
We host regular retirement planning workshops throughout the country to help you get the most out of your retirement. These sessions run for around two hours and there’s no additional cost to attend (it’s all covered by your admin fees).
If you’ve reached preservation age, you can also boost your super by opening an MTAA Super Transition to Retirement account to grow your retirement savings while you’re still working.
The Age Pension and super
The Age Pension is a regular income to help older Australians pay for basic living expenses. Your eligibility for the Age Pension is based on your income (the income test) and how much your assets are worth (the assets test).
Once you reach your preservation age, your super counts towards the income and assets tests. However, you don’t need to spend all your super before you can access the Age Pension. Many retirees have an income made up of both a super pension and the Age Pension.
This information on this website is provided by Motor Trades Association of Australia Superannuation Fund Pty Ltd (ABN 14 008 650 628, AFSL 238 718) of Level 3, 39 Brisbane Avenue BARTON ACT 2600, Trustee of the MTAA Superannuation Fund (ABN 74 559 365 913). Motor Trades Association of Australia Superannuation Fund Pty Ltd has ownership interests in Industry Super Holdings Pty Ltd and Members Equity Bank Limited (ABN 56 070 88 7 679).
The information contained in this website is correct at the time of publishing. It is of a general nature and does not take into account your objectives, financial situation or needs. Before acting on any of the information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. If you are considering acquiring or continuing to hold a particular financial product, you should obtain the Product Disclosure Statement relating to the product and consider it before making any decision. The MTAA Super Product Disclosure Statement is available on this website, or by telephoning the Customer Service Centre on 1300 362 415.
This site is for general information purposes only and is not intended to be relied upon for the purpose of making an investment decision.
MTAA Super recommends that potential investors seek independent financial and taxation advice before making any investment decisions so as to determine whether an investment is appropriate, given the investor’s investment objectives, financial position and needs.
Applications for membership can only be made on the basis of the application form attached to the current PDS. Any person who gives another person access to the application form must at the same time and by the same means give the other person access to the relevant PDS and any supplementary document.