How much superannuation is enough?
How much supernnuation is enough? Not $510,000 for a couple hoping for a comfortable retirement.
The Association of Superannuation Funds of Australia (ASFA) has recalculated the amounts for couples and singles to factor in rises in the cost of living, the impact of tighter age pension requirements and increasing life expectancy.
Couples now need to save an extra $130,000 to have the $640,000 lump sum ASFA says is now needed for a comfortable retirement. And singles need to save $115,000 more for a total nest egg of $545,000.
The latest ASFA Retirement Standard found a couple around 65 need to spend $58,784 a year and singles $42,861 a year.
"In particular, adjustments to the taper rate and thresholds for the assets test will impact how people plan to fund their retirement," explains Pauline Vamos, CEO, ASFA.
"While some individuals with relatively low retirement savings will receive a small increase in their age pension after January 1, 2017, others will receive a lower age pension, or none at all, until they run down their superannuation. As a result, many individuals and couples will require higher levels of private savings for a comfortable standard of living in retirement.
"If there are further increases to the eligibility age for the age pension beyond what is already legislated and a lower indexation factor is applied to future increases in the age pension, those retirement savings targets will necessarily increase further."
The biggest price rises affecting the cost of living for retirees this quarter are automotive fuel (+12.2 %) and medical and hospital services (+4.5%). The biggest price falls this quarter are domestic holiday travel and accommodation (-5.4%) and pharmaceuticals (-1.8%).
The main contributor to the rise in health-related costs in the June quarter was medical and hospital services (+4.5%). The rise was due to substantial increases in private health insurance premiums from April 1, as well as the annual indexation of the private health insurance rebate also in April.