Slide into retirement like a boss
Find out how easy it could be to ease into retirement with Sunsuper’s Transition to Retirement (TTR) Income Account.
Pay yourself a salary, give yourself a bonus
Sunsuper’s award-winning Retirement income account could be much smarter than withdrawing all your money at once when you stop working. It gives you the certainty of a regular “paycheck”, while your super continues to generate earnings. You may also be eligible for a bonus of up to $4,800.
Every Sunsuper member has a Retirement Income Account that can be activated when you retire and reach your preservation age, or reach age 65 whether you’re retired or not. It lets you pay yourself a salary after you’ve stopped working, while your super savings stay invested to keep working for you. What’s more, earnings on your investments are.
Not yet a member? Find out more.
What are your plans for when you're the boss?
Retirement is the new promotion. When you become the boss – of you. Find out how much income you may need to live your dream lifestyle in retirement by selecting how you’d most like to spend your time (you can choose more than one option) then clicking continue.
Learn more about using your super in retirement
- How much super do I need to retire?
- How much will my retirement lifestyle cost?
- Will I be eligible for the government age pension?
- What else is there to consider?
- How long will my super last?
- Can I still grow my super balance?
- Why should I keep my money in super?
- How can my investment choice make a difference?
How much super do I need to retire?
There has been much debate about the magical number you might need to live a comfortable retirement. Some commentators tout $1 million, others claim half that amount. What’s more, the fact is while some of us may be fortunate enough to look forward to retiring with $1 million, or even $500,000, the median super balance at retirement in 2015-16 was $270,710 for men and $157,050 for women.*
*Source: Superannuation account balances by age and gender, ASFA Research and Resource Centre, October 2017
The truth is there's no magic amount that applies to everyone – it all comes back to you – your lifestyle goals and how much they’ll cost, how long you’ll live for - or expect to live, and whether you’ll be eligible to receive some or all of the government age pension.
How much will my retirement lifestyle cost?
Calculating a total number for how much you'll need in retirement may not be the smartest way to approach this question. Considering an annual income you think you’ll need may be easier and more appropriate.
We estimate that a single person will need around $45,000 per year, and a couple $60,000, to live a “doing well” lifestyle in retirement. But of course, these amounts could be more or less depending on your expectations.
You can read more about our estimated retirement lifestyles and what they’ll allow you to achieve and enjoy.
Will I be eligible for the government age pension?
51% of men and 43% of women who had already retired in 2014-15 said they relied on the government age pension as their main source of retirement income*.
You need to meet three key criteria to receive the government age pension:
- 1. You need to be an Australian resident on the day you apply for the pension and generally have lived in Australia for more than 10 years.
- 2. You need to have reached the qualifying pension age, which depends on when you were born; and
- 3. You need to meet the income and asset tests, which specify a threshold that determines whether you're entitled to the full or partial age pension.
You can find out more here
*Source: Australian Bureau of Statistics.
What else is there to consider?
When calculating how much super you may need to retire, there are few other life factors to consider. How long you may live, your health status, how you invest your savings, and whether you plan on leaving any assets or savings to your children will all affect your lifestyle after work and how much it will cost.
And while some recent media reports have proposed that you might be better off with only modest super savings in order to still qualify for the full age pension, it’s a good idea to consider that the lifestyle you may be dreaming of in retirement may not be met through the full age pension supplemented by a small super income. As well, it may be important to remember that the current age pension amounts and eligibility rules may not remain constant over time.
How long will my super last?
Life expectancy is increasing. There's a good chance you'll live longer than your grandparents did, but there's also a chance you could outlive your super savings.
We don't see this reality as doom and gloom, rather as motivation to understand your position and consider positive actions that’ll have lasting effects throughout your retirement. Our Retirement forecaster is a good first step, as it can help you gauge how long your super will last based on where you are now, and the lifestyle you want to live later.
Can I still grow my super balance?
For many people, there are things that can be done now to boost your super and enjoy a better lifestyle in retirement. Before-tax contributions like salary sacrificing can be a great, and tax-friendly, way to add more to your savings. After-tax contributions that you voluntarily add from your savings can also boost your super balance and, if you're in a lower income bracket, you may receive a government co-contribution of up to $500 per year.
It is important to consider though, that once you're aged 65 you need to meet a work test, of at least 40 hours gainful employment in a 30-day period, before you can make any personal contribution to super. Note that from 1 July 2019, retirees aged between 65 and 74 with a superannuation balance below $300,000 are allowed to make voluntary super contributions for the first year that they no longer meet the work test requirements. Once you reach age 75 you’re unable to contribute further. Also keep in mind the annual ‘contribution caps’ that limit how much you can contribute each year.
However, proceeds from the sale of your home might also be used to seriously boost your super savings, and the work tests and limits mentioned above don’t apply.
If you're over 65, the government allows people to contribute up to $300,000 ($600,000 per couple) of the proceeds made on the sale of their home to their super, if owned for 10 years or more.
Why should I keep my money in super?
For one very important reason: the 10/30/60 Revelation. It uses the compounding interest your savings accrue to help fund your lifestyle, but the Revelation only works if your balance stays invested in super through right through retirement.
Try the tool to see how much of your income might come from the earnings you make on your super balance after you retire.
How can my investment choice make a difference?
The amount of interest you earn on your super balance depends on the assets your super balance is invested in. And your choice of investments could earn significantly different rates of interest.. Many retirees traditionally move their savings into more conservative investments, like cash, to avoid the risk of market ups and downs. This may be a valid option, but it's important to remember that if you retire at 65, statistically you could have 20 years ahead of you – a lot of time left for your super to grow.
If you activate your Retirement Income Account with Sunsuper, your balance will automatically be invested in our diversified Retirement option, which has been specifically designed for members who have reached retirement and aims to provide some reduction in market fluctuations that may affect growth assets like shares and property, while still generating wealth over the medium to long term.
View the performance of our Retirement option over time, and remember these returns are tax-free.
You are the Head Honcho
Fiesty and family-focused
Driven, dedicated, and outcome focused. You always have a plan and, if an opportunity arises, you seize it with both hands and give it 100%. Retirement for you will be business as usual. You'll challenge yourself, then challenge yourself again. You'll set goals, you\'ll achieve them. What will change, however, is a shift from company life to the company in life. Amongst your many plans, you'll always have time to build better connections with your closest, minus the deadlines.
Talk to your financial adviser or get some advice through Sunsuper
Depending on your advice needs, we can answer most of your questions over the phone. To get the conversation started, just fill in your details and we’ll be in touch.
Or call us!
We're here to help13 11 84