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How much money is needed for retirement?
Following consultation with the financial community, Super Consumers Australia (SCA) has developed new retirement savings targets for households.
SCA’s consultation engaged consumers, academics, regulators, industry experts and superannuation funds across 30 organisations.
SCA director, Xavier O’Halloran, said: “Among the most important financial questions retirement-planning Australians face is how much they need to save and what income those savings will deliver in retirement. These new retirement targets are designed to help people answer these questions. They provide a solid ‘rule of thumb’ for what is needed to maintain your living standards when you’re retired
“These savings targets are based on what people spend in retirement with a buffer built in to provide confidence that people’s savings can weather the type of market volatility we’re currently experiencing. Having credible targets, based on actual spending, means people can confidently spend and get on with enjoying their retirement.
“These targets come at a time when the superannuation industry is grappling with the needs of consumers who are approaching retirement. As part of the Retirement Income Covenant, we would expect funds to be using these targets to help members make sense of their retirement income needs.”
The targets, supported by the philanthropic group Ecstra Foundataion, were provided below:
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