How Much Do I Need to Retire in Australia?
Posted by
Matt Hale
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Retirement looks different for everyone. You might be counting down the years until you can leave work behind, or starting to think about your financial future in your 20s or 30s.
Either way, knowing how much money you’ll need can help you prepare for the lifestyle you hope to enjoy. And while your superannuation will likely play a major role, it’s only one part of the picture.
When asking ‘how much do I need to retire?’, consider your savings, investments, income sources and lifestyle to estimate how much you’ll need. Let’s look at what goes into that figure and how you can start preparing for the retirement you want.
What Counts as ‘Money to Retire On’?
When working out how much you need to retire, it helps to look beyond your super balance. Your retirement income may come from several sources, depending on your eligibility, assets and financial circumstances.
- Superannuation – Your super can provide a regular income in retirement through withdrawals or an account-based pension.
- Age Pension – If you meet the eligibility requirements, you may receive a full or part Age Pension to supplement your retirement income.
- Savings and investments – Money held in savings accounts, shares and other investments can help fund your retirement lifestyle.
- Investment property – Rental income from an investment property may provide an additional source of income, depending on your costs and rental returns.
- Inheritance – An inheritance may contribute to your retirement savings or provide additional funds during retirement, depending on your circumstances.
What Does a Comfortable vs Modest Retirement Actually Cost?
The cost of retirement depends on the lifestyle you hope to enjoy and whether you own your home or rent. To help you estimate how much you may need, the Association of Superannuation Funds of Australia (ASFA) publishes the Retirement Standard, which outlines estimated living costs for singles and couples aged 65-84.
ASFA’s June quarter 2026 figures provide a guide to the annual and weekly costs for a modest or comfortable retirement. The figures below can help you compare different lifestyles and understand how your housing situation may affect your retirement income needs.
Comparing retirement costs by lifestyle and household:
| Household | Retirement lifestyle | Weekly cost | Annual cost |
| Single | Comfortable (homeowner) | $1,080 | $56,166 |
| Modest (homeowner) | $703 | $36,548 | |
| Modest (private renter) | $989 | $51,418 | |
| Couple | Comfortable (homeowner) | $1,519 | $78,998 |
| Modest (homeowner) | $1,013 | $52,690 | |
| Modest (private renter) | $1,334 | $69,376 |
Weekly figures are calculated by dividing the annual amounts by 52 (the number of weeks in a year) and rounding to the nearest dollar. ASFA’s figures are estimates, not guaranteed costs. A comfortable retirement budget assumes home ownership, and the supplied figures do not include a comfortable renter category.
Where the Money Actually Goes
Knowing how much money you need to retire is one part of retirement planning. Understanding how you’ll spend that money can help you estimate your living costs and plan for the lifestyle you hope to enjoy.
- Housing – Homeowners may need to budget for council rates, insurance, maintenance and repairs. Renters also need to account for ongoing rental payments.
- Food – Groceries, household essentials and dining out all contribute to your regular spending.
- Health – Medical appointments, prescriptions, dental care and health insurance can add to your retirement expenses.
- Transport – This may include car registration, fuel, insurance and maintenance. Public transport is another expense to consider.
- Insurance – Life insurance premiums may remain part of your retirement budget if you choose to maintain cover after leaving work.
- Leisure – Holidays, hobbies, entertainment and social activities can shape your retirement budget, particularly if you plan to spend more time enjoying these activities.
How the Age Pension Fits In
The Age Pension is a regular payment from the Australian Government for eligible older Australians. It can provide a foundation for retirement income and help cover essential living costs.
For many retirees, it forms a central part of their retirement income, rather than simply topping up their superannuation. The amount you receive depends on your age, residency, income and assets.
When estimating how much money you need to retire, consider the Age Pension alongside your superannuation, savings and other income sources. Knowing how much you may receive can help you estimate how much additional income you’ll need to fund your retirement lifestyle.
What Retirement Income Could Look Like
Avery is planning for an annual retirement income of $55,000. They expect to draw on a mix of income sources to fund their retirement:
- Superannuation: $30,000 per year
- Savings and investments: $10,000 per year
- Age Pension: $15,000 per year, if eligible
Together, these sources would provide Avery with $55,000 a year. The actual amounts will depend on their financial circumstances and Age Pension eligibility.
Closing the Gap Between Your Savings and Retirement Goals
If your savings fall short of your retirement income goal, there are several ways to address the gap:
- Increase your super contributions – Adding more to your super could help grow your retirement savings over time.
- Adjust your retirement age – Working for longer may give you more time to save and reduce the number of years you need to fund in retirement.
- Reassess your lifestyle – Reviewing your expected spending could help you identify areas to adjust your retirement budget.
- Consider other assets – Savings, investments or an inheritance may provide additional funds for retirement.
As you plan for retirement, asking ‘how much do I need to retire?’ is a useful starting point. A financial advisor can help you explore your options and understand how different decisions may affect your plans.
Our financial planner vs advisor guide explains the differences between these approaches to financial advice. You can also learn more about inheritance tax and how an inheritance may fit into your broader financial plans.
