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Most people need around 70% of their take home pay to maintain their current lifestyle in retirement. Each person’s retirement plan is different. It will depend on when you want to retire, what you’re going to do in retirement and where you live. The good news is you could be eligible for the Government Age Pension or other government benefits.

Key points:

  • Your income in retirement shouldn’t be a guessing game. Knowing how much money you’ll need will help you plan towards your retirement goal. 
  • You need less money in retirement because you’re not paying tax on your income or making super contributions and are likely to have no mortgage and less debt. 
  • Comparing your balance to the average for your age is another good measure to see if you’re on track.

How much to save for your retirement

Maintain your current lifestyle in retirement

For most people, having around 70% of their current take-home pay, is the amount of money they need in retirement to keep the lifestyle they have now.1

To work out how much you might need, this is a good place to start. But keep in mind, how much you may need will change depending on your expenses and what you earn now.

Don’t worry if you’re on a lower income - the tax-free income you’ll get from your super could be supplemented by the Government Age Pension2.

1 Source -
2 From age 60 and over, generally no tax is payable on withdrawals from your super in retirement. Under age 60, tax may apply on withdrawals.

Watch this video to understand how much you’ll need to maintain your lifestyle in retirement

There’s no magic number for how much you’ll need in retirement- it’s different for everybody.  

You are likely to need less money in retirement than you need now, though, because you’re not paying tax on your income or making super contributions- and you might have paid off your mortgage and other debt. 

The money you’ll have at retirement is usually made up of a mix of your super, any other savings you have, and for more than 60% of Australians, the Government Age Pension, which can help bridge the gap between what you have and the income you need.  

As a general rule, most people will need 70% of their take home pay to maintain their lifestyle in retirement.   

And since we’re living longer, which is great, your super may need to last for 30 years or more after you retire.  

It may seem daunting, but we can help you figure out how much super you’ll need. 

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Some reasons you don't need as much money in retirement

You'll be spending less

  • It’s likely you’ll have paid off your debts, including your mortgage, or the costs of raising a family.
  • Your expenses are likely to change when you’ve retired. Retirees who are seniors often get discounts, which can reduce day-to-day costs.
  • You’re no longer putting away money for retirement.

You could get more income

  • Like over 60% of Australians over the age of 65, you could get extra income from the Government Age Pension.3
  • Once you turn 60, the super you withdraw in retirement from your account-based pension or from additional withdrawals, is tax-free.

3 Australian Institute of Health and Welfare, March 2021 – Age Pension figures

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Related information

Where to next?

My Retirement Planner

Get an estimate of how much money you’ll need in retirement, plus a Retirement Confidence Score that shows how close you are to achieving your retirement goals. You’ll also get a step-by-step action plan to point you in the right direction. 

Speak to a financial planner

A financial planner can work through complex financial matters and help you create the right strategies to achieve your financial goals in retirement. They’ll explain any next steps, fees and charges before progressing.

Find out more about the Government Age Pension

You may be eligible for the Government Age Pension when you retire to help fund your life in retirement.