You could retire at any time and any age in Australia, as long as you have sufficient regular income to support your lifestyle.
Most Aussies receive their retirement income from either investment, age pension from Centrelink, or a combination of both.
Here are some interesting figures about retirement in Australia that you might not know:
- You need to pass a series of stringent tests to be eligible for the government age pension after your 67th birthday (for most Australians), and the pension is maxed at $1,423.60 pf (the equivalent of $37,013.60 pa) for a non-homeowner couple (Source: Services Australia). Most people feel that the government age pension is nowhere near enough to fund a “comfortable” lifestyle.
- Average superannuation balances at the time of retirement (assumed to be age 60 to 64) in 2015-16 were $270,710 for men and $157,050 for women (Source: The Association of Superannuation Funds of Australia Limited (ASFA)). If there was no investment movement and assuming you need $60,000 pa to retire comfortably, the superannuation fund balance will become $0 in less than 5 years for men and less than 3 years for women.
- The average life expectancy in Australia has increased by almost 20% during the past 50 years in Australia (Source: WorldBank), so you may have more years to support yourself and your family than the previous generations. The aging population also means taxpayers have to work harder to fund the current pension system, but might not have the same amount of benefits when they retire because the dollars in the age pension “pool” are shrinking.
Is there a better way to do retirement since the government pension doesn’t look so glamourous?
And that is by building investment assets outside of your family home, both inside and outside of your superannuation fund, to reduce your reliance on the government pension.
You can use this simple, 7-question calculator to work out your ultimate retirement question:
How much is enough?