The worryingly low pension levels of most Australians – and what you can do from NEXT MONTH to ensure you can retire comfortably
- Average Australian pension balances are $143,979, new data shows
- That’s well under the $535,000 recommended for a comfortable retirement
- Men typically had $162,275 for retirement compared to $128,068 for women
Australians are nowhere near enough to retire, with an average pension balance of less than $145,000.
The Association of Superannuation Funds of Australia recommends that a single retiree have $535,000 saved to enjoy twilight in comfort.
But the average super-savings in 2018-19 were just $143,979, the new Australian tax office released Monday revealed.
Men typically had $162,275 in their retirement fund, compared to $128,068 for women, a 21 percent difference.
Average super savings in 2018-19 were just $143,979, new data from the tax office showed. In the photo are women
Average Super Savings
ALL REVENUES: $143,979
$180,000 PLUS EARNINGS: $608,283
Source: Australian tax office data for 2018-19
The top 3.5 percent of professionals, who made more than $180,000, had an average super balance of $608,283, making them the only income group that had more than enough to retire comfortably.
Above-average earners, with salaries ranging from $90,000 to $180,000, had an average balance of $257,695.
The 41.7 percent of Australians earning between $37,000 and $90,000 had $121,119 in average retirement savings.
Beginning July 1, this year, the threshold for voluntary super contributions eligible for the discounted 15 percent rate will increase from $25,000 to $27,500.
The mandatory employer super contributions will also increase on that date from 9.5 percent to 10 percent.
They will be increased in half percentage point increments at the beginning of each fiscal year until it reaches 12 percent by July 2025.
Former Labor Prime Minister Paul Keating, the architect of the mandatory super-scheme that started in 1992, wants a 15 percent rate.
The Association of Superannuation Funds of Australia recommends that a single retiree have $535,000 saved to enjoy twilight in comfort. Shown is a stock photo
When will Australians have access to their super?
For those born before July 1, 1960, it is 55
The increase to 56 for baby boomers born between July 1, 1960 and June 30, 1961
It is 57 for those born between July 1, 1961 and June 30, 1962
It is 58 for those born between July 1, 1962 and June 30, 1963
It is 59 for those born between July 1, 1963 and June 30, 1964
It’s 60 for everyone born after July 1, 1964 born
Money expert Nicole Pedersen-McKinnon, the author of How to Get Mortgage-Free Like Me, said saving a few hundred a month at a young age was key to being able to retire in luxury with $1 million in retirement savings.
“If you start tipping later, it’s going to be a chore to get that magic million,” she told the Daily Mail Australia.
She advised a 20-year-old college student living at home to set aside $381 a month.
The longer someone put off voluntarily upgrading their super, the more they would have to lose later to meet the seven-figure goal.
An employee who actively contributes to his super would have to set aside $820 per month from age 30, increasing to $1,921 per month for someone over 40 and $5,778 for a person who leaves it until age 50.
In any case, Australians are more likely to expand their superposition with the ANZ job ad series showing a 7.9 percent increase in May to a 12-year high of 213,894 available positions.
The number of jobs advertised on the Internet has risen for 12 consecutive months to 219.8 percent more than a year ago and 38.8 percent above the pre-pandemic level of early 2020.
CommSec senior economist Ryan Felsman said international border closures and skills shortages were a major obstacle for employers.