How much money you should have in superannuation now

Australians are lagging behind in their retirement savings and are falling well behind where they should be based on their age. SEE WHAT YOU NEED TO BE SAVING

Exclusive: Australians’ superannuation balances are falling well behind where they should be to ensure people can live a comfortable retirement, new analysis has found.

The Association of Superannuation Funds of Australia (ASFA) released new figures showing the actual balances for a single person based on 2016/17 ABS data.

This was then compared to the target balance that should be reached throughout a person’s lifespan to achieve a comfortable retirement.

It revealed the following concerning findings:

* the median account balance for a 30 to 34-year-old male was $35,768 and for a female,$30,129. This is well behind the target balance for that age bracket of $93,000.

* the median account balance for a 45 to 49-year-old male was $99,305 and for a female,$65,796. The target balance is $257,000.

ASFA’s chief executive officer Dr Martin Fahy urged Australians to start by consolidating multiple superannuation accounts and then consider tipping extra in.

“Go to MyGov and check for unclaimed super and consolidate those accounts,” he said.

“Make extra contributions, if you add an extra $10 per week to your super (based on a 35-year-old) it could add an extra $18,000 to your balance.

“Check your fees and if you’re self-employed please pay your super.”

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ASFA’s comfortable retirement standard presumes a person owns their home outright once they stop work and has relatively good health.

A comfortable retirement requires a single person to have $545,000 at retirement and a couple $640,000.

This means retirees can have domestic and international holidays, own a reasonable car and run airconditioning.

Australians should be checking their superannuation balances to ensure they have enough money once they stop work.

There has been plenty of debate in recent weeks on whether compulsory superannuation payments should rise to 12 per cent by 2025, which the industry wants to proceed.

QSuper’s chief of QInvest Kim Hughes reinforced the importance of putting extra money into super.

“Contributing to your super while you’re still working could also help you pay less income tax, potentially putting more in your pocket at tax time while boosting your retirement savings,” she said.

“Payments come out of your salary before you pay income tax and you only pay 15 per cent instead of your marginal tax rate.”

Intrust Super’s chief executive officer Brendan O’Farrell said consolidating accounts could help “save on duplicate fees and insurance premiums”.

“But the quickest way to fast track your super balance is to contribute that little bit extra that doesn’t impact your budget,” he said.

“A great way to achieve this for eligible investors is to contribute after-tax contributions up to $1000 that could see you receive a little kicker of up to $500, from the Government via their co-contribution scheme.”

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