A million dollars is often talked about as the gold standard of retirement savings, but it is a suspiciously round number. Depending on your personal circumstances, you might live well on much less, say $750,000, especially if you are not a big traveller or you intend to continue working well into your 70s.
We’ve decided to test run a series of retirement balances that are below $1 million but more than comfortable according to the ASFA Retirement Standard. ASFA estimates a couple can live a ‘comfortable lifestyle’ with a retirement balance of $640,000 while singles can enjoy the same with $545,000.
Using MoneySmart’s Retirement Planner we have calculated how much income $750,000 in super will generate under a range of scenarios including:
- Whether you are single or in a couple.
- The age you plan to retire. We have selected 60, which is a common goal, then 65, 66, 67, 68, 70 and 75 to show the impact of delaying retirement.
- How long you want your money to last. We run the numbers for age 85, 90, 95 and 100 on the basis that the average retiree will live until their mid-80s and some will celebrate 100.
- The return on your $750,000, net of fees. The return your super investments earn in retirement will depend on the type of investments you choose. A higher ratio of growth to defensive investments will result in a higher long-term return. To demonstrate the difference a few percentage points can make, we break down the annual income received for an average net return of 2%, 3%, 4%, 5%, 6%, 7% and 8%.
We also assume you are a homeowner and include income from a full or part Age Pension if you are eligible (this may happen as your super balance reduces over time). However, we don’t take into account income from assets you may hold outside super.
All figures are in today’s dollars (adjusted for inflation). We have assumed an annual 2% rise in cost of living and an additional 1.2% rise in living standards per year.
Where to go for more
We hope that the figures in the tables below will get you thinking. The data in these tables is a small selection of possible outcomes. To plug in your own numbers, check out SuperGuide’s Super to income Reckoner which has nearly 9,000 options.
We also encourage you to try out MoneySmart’s Retirement Planner calculator with your projected super balance, retirement age, length of retirement and estimated investment returns.
Income generated from a $750,000 retirement super balance
First let’s look at various scenarios for a couple with a combined balance of $750,000 on retirement, which they transfer into a super pension account.
Couple: Retiring at 60
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $52,063 | $54,539 | $57,163 | $59,957 | $62,928 | $66,042 | $69,271 |
| No | $24,348 | $27,647 | $31,258 | $35,173 | $39,372 | $43,761 | $48,341 | |
|
90 |
Yes | $49,156 | $51,452 | $53,943 | $56,614 | $59,452 | $62,451 | $65,638 |
| No | $20,061 | $23,108 | $26,704 | $30,723 | $34,993 | $39,562 | $44,361 | |
|
95 |
Yes | $47,102 | $49,156 | $51,538 | $54,107 | $56,841 | $59,751 | $62,840 |
| No | $17,082 | $19,838 | $23,260 | $27,389 | $31,876 | $36,624 | $41,633 | |
|
100 |
Yes | $45,532 | $47,396 | $49,547 | $52,023 | $54,760 | $57,573 | $60,557 |
| No | $14,923 | $17,410 | $20,544 | $24,519 | $29,476 | $34,491 | $39,621 | |
Couple: Retiring at 65
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $61,962 | $64,598 | $67,351 | $70,258 | $73,281 | $76,470 | $79,753 |
| No | $31,009 | $34,426 | $38,054 | $41,867 | $45,927 | $50,148 | $54,540 | |
|
90 |
Yes | $55,835 | $58,284 | $60,921 | $63,705 | $66,651 | $69,761 | $73,034 |
| No | $24,500 | $27,640 | $31,277 | $35,178 | $39,372 | $43,761 | $48,341 | |
|
95 |
Yes | $51,726 | $54,073 | $56,592 | $59,255 | $62,073 | $65,139 | $68,352 |
| No | $20,256 | $23,146 | $26,590 | $30,601 | $34,975 | $39,562 | $44,361 | |
|
100 |
Yes | $48,993 | $50,845 | $53,257 | $55,945 | $58,745 | $61,734 | $64,851 |
| No | $17,324 | $19,902 | $23,060 | $26,955 | $31,678 | $36,599 | $41,633 | |
Couple: Retiring at 66
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $63,817 | $66,461 | $69,271 | $72,176 | $75,322 | $78,536 | $81,869 |
| No | $32,785 | $36,166 | $39,814 | $43,637 | $47,644 | $51,821 | $56,169 | |
|
90 |
Yes | $57,012 | $59,516 | $62,167 | $64,977 | $67,977 | $71,136 | $74,436 |
| No | $25,613 | $28,820 | $32,407 | $36,339 | $40,462 | $44,771 | $49,366 | |
|
95 |
Yes | $52,538 | $54,915 | $57,455 | $60,162 | $63,051 | $66,128 | $69,366 |
| No | $21,024 | $23,938 | $27,371 | $31,327 | $35,703 | $40,270 | $45,056 | |
|
100 |
Yes | $49,492 | $51,464 | $53,917 | $56,635 | $59,478 | $62,451 | $65,151 |
| No | $17,908 | $20,487 | $23,644 | $27,509 | $32,178 | $37,106 | $42,110 | |
Couple: Retiring at 67
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $65,630 | $68,330 | $71,166 | $74,141 | $77,239 | $80,464 | $83,825 |
| No | $34,671 | $38,078 | $41,752 | $45,561 | $49,543 | $53,673 | $57,976 | |
|
90 |
Yes | $58,126 | $60,652 | $63,351 | $66,211 | $69,212 | $72,374 | $75,681 |
| No | $26,801 | $30,020 | $33,653 | $37,553 | $41,661 | $45,963 | $50,257 | |
|
95 |
Yes | $53,306 | $55,692 | $58,252 | $61,008 | $63,914 | $66,966 | $70,254 |
| No | $21,830 | $24,778 | $28,256 | $32,242 | $36,562 | $41,062 | $45,782 | |
|
100 |
Yes | $49,993 | $52,054 | $54,497 | $57,259 | $60,107 | $63,083 | $66,323 |
| No | $18,486 | $21,093 | $24,285 | $28,159 | $32,821 | $37,688 | $42,623 | |
Couple: Retiring at 68
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $67,629 | $70,376 | $73,253 | $76,251 | $79,375 | $82,614 | $85,973 |
| No | $36,844 | $40,291 | $43,912 | $47,676 | $51,645 | $55,759 | $60,024 | |
|
90 |
Yes | $59,342 | $61,932 | $64,643 | $67,521 | $70,550 | $73,718 | $77,049 |
| No | $28,088 | $31,373 | $35,001 | $38,867 | $42,956 | $47,246 | $51,713 | |
|
95 |
Yes | $54,131 | $56,557 | $59,143 | $61,902 | $64,828 | $67,882 | $71,166 |
| No | $22,681 | $25,680 | $29,178 | $33,166 | $37,434 | $41,867 | $46,571 | |
|
100 |
Yes | $50,546 | $52,676 | $55,149 | $57,882 | $60,769 | $63,816 | $67,022 |
| No | $19,100 | $21,752 | $24,963 | $28,847 | $33,475 | $38,278 | $43,161 | |
Couple: Retiring at 70
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $72,460 | $75,307 | $78,224 | $81,269 | $84,439 | $87,678 | $91,063 |
| No | $41,954 | $45,421 | $49,033 | $52,790 | $56,674 | $60,684 | $64,852 | |
|
90 |
Yes | $62,167 | $64,816 | $67,594 | $70,518 | $73,565 | $76,754 | $80,126 |
| No | $31,060 | $34,428 | $38,054 | $41,867 | $45,927 | $50,148 | $54,540 | |
|
95 |
Yes | $55,945 | $58,446 | $61,062 | $63,872 | $66,852 | $69,980 | $73,265 |
| No | $24,610 | $27,665 | $31,238 | $35,209 | $39,372 | $43,761 | $48,341 | |
|
100 |
Yes | $51,837 | $54,034 | $56,549 | $59,313 | $62,234 | $65,310 | $68,546 |
| No | $20,474 | $23,172 | $26,433 | $30,329 | $34,904 | $39,567 | $44,361 | |
Couple: Retiring at 75
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $92,533 | $95,556 | $98,638 | $101,760 | $104,980 | $108,320 | $111,712 |
| No | $62,915 | $66,367 | $69,980 | $73,651 | $77,355 | $81,254 | $85,153 | |
|
90 |
Yes | $72,460 | $75,307 | $78,224 | $81,269 | $84,439 | $87,678 | $91,063 |
| No | $41,954 | $45,421 | $49,033 | $52,790 | $56,674 | $60,684 | $64,852 | |
|
95 |
Yes | $62,167 | $64,816 | $67,594 | $70,518 | $73,565 | $76,754 | $80,126 |
| No | $31,185 | $34,442 | $38,037 | $41,872 | $45,927 | $50,148 | $54,540 | |
|
100 |
Yes | $55,920 | $58,326 | $60,989 | $63,862 | $66,852 | $69,980 | $73,265 |
| No | $24,908 | $27,758 | $31,048 | $34,895 | $39,254 | $43,768 | $48,341 | |
The following scenarios are for a single person with a retirement super balance of $750,000 which they transfer into a super pension account.
Single: Retiring at 60
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $40,564 | $42,759 | $45,165 | $47,738 | $50,457 | $53,464 | $56,717 |
| No | $24,337 | $27,657 | $31,308 | $35,183 | $39,362 | $43,752 | $48,358 | |
|
90 |
Yes | $36,851 | $38,831 | $40,955 | $43,361 | $45,951 | $48,773 | $52,000 |
| No | $20,061 | $23,108 | $26,701 | $30,725 | $35,000 | $39,558 | $44,322 | |
|
95 |
Yes | $34,223 | $36,040 | $38,021 | $40,205 | $42,648 | $45,420 | $48,542 |
| No | $17,081 | $19,833 | $23,260 | $27,389 | $31,876 | $36,625 | $41,631 | |
|
100 |
Yes | $32,114 | $33,768 | $35,693 | $37,806 | $40,139 | $42,759 | $45,857 |
| No | $14,921 | $17,406 | $20,544 | $24,518 | $29,486 | $34,489 | $39,663 | |
Single: Retiring at 65
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $46,744 | $49,127 | $51,637 | $54,332 | $57,260 | $60,285 | $63,568 |
| No | $31,018 | $34,426 | $38,054 | $41,894 | $45,887 | $50,148 | $54,538 | |
|
90 |
Yes | $40,808 | $42,880 | $45,255 | $47,783 | $50,457 | $53,464 | $56,717 |
| No | $24,496 | $27,681 | $31,277 | $35,187 | $39,362 | $43,752 | $48,358 | |
|
95 |
Yes | $36,892 | $38,903 | $41,027 | $43,361 | $45,951 | $48,773 | $52,000 |
| No | $20,259 | $23,134 | $26,593 | $30,600 | $34,994 | $39,558 | $44,322 | |
|
100 |
Yes | $34,136 | $35,895 | $37,938 | $40,181 | $42,648 | $45,420 | $48,542 |
| No | $17,333 | $19,903 | $23,061 | $26,954 | $31,676 | $36,621 | $41,631 | |
Single: Retiring at 66
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $48,322 | $50,750 | $53,302 | $56,062 | $58,967 | $62,042 | $65,324 |
| No | $32,787 | $36,173 | $39,814 | $43,636 | $47,644 | $51,781 | $56,147 | |
|
90 |
Yes | $41,797 | $43,955 | $46,334 | $48,864 | $51,660 | $54,630 | $57,859 |
| No | $25,616 | $28,820 | $32,400 | $36,340 | $40,475 | $44,833 | $49,376 | |
|
95 |
Yes | $37,588 | $39,603 | $41,744 | $44,082 | $46,759 | $49,653 | $52,846 |
| No | $21,037 | $23,936 | $27,377 | $31,370 | $35,749 | $40,264 | $45,060 | |
|
100 |
Yes | $34,636 | $36,408 | $38,457 | $40,768 | $43,255 | $46,018 | $49,164 |
| No | $17,904 | $20,490 | $23,630 | $27,510 | $32,190 | $37,134 | $42,098 | |
Single: Retiring at 67
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $50,096 | $52,545 | $55,178 | $57,932 | $60,880 | $64,022 | $67,266 |
| No | $34,678 | $38,130 | $41,753 | $45,557 | $49,543 | $53,675 | $57,975 | |
|
90 |
Yes | $42,865 | $45,075 | $47,450 | $50,051 | $52,863 | $55,870 | $59,140 |
| No | $26,801 | $30,036 | $33,652 | $37,551 | $41,663 | $45,978 | $50,458 | |
|
95 |
Yes | $38,309 | $40,335 | $42,531 | $44,954 | $47,571 | $50,457 | $53,703 |
| No | $21,827 | $24,768 | $28,222 | $32,243 | $36,545 | $41,061 | $45,767 | |
|
100 |
Yes | $35,102 | $36,935 | $39,063 | $41,361 | $43,857 | $46,683 | $49,815 |
| No | $18,489 | $21,105 | $24,285 | $28,160 | $32,821 | $37,692 | $42,604 | |
Single: Retiring at 68
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $52,051 | $54,577 | $57,241 | $60,024 | $62,966 | $66,138 | $69,461 |
| No | $36,836 | $40,264 | $43,911 | $47,701 | $51,653 | $55,750 | $60,025 | |
|
90 |
Yes | $44,037 | $46,278 | $48,738 | $51,399 | $54,156 | $57,258 | $60,470 |
| No | $28,052 | $31,351 | $35,001 | $38,868 | $42,956 | $47,247 | $51,722 | |
|
95 |
Yes | $39,061 | $41,075 | $43,361 | $45,836 | $48,505 | $51,428 | $54,629 |
| No | $22,688 | $25,680 | $29,172 | $33,166 | $37,437 | $41,885 | $46,579 | |
|
100 |
Yes | $35,624 | $37,508 | $39,665 | $41,995 | $44,520 | $47,353 | $50,526 |
| No | $19,103 | $21,747 | $24,963 | $28,837 | $33,471 | $38,232 | $43,151 | |
Single: Retiring at 70
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $56,757 | $59,358 | $62,154 | $65,044 | $68,100 | $71,234 | $74,543 |
| No | $41,956 | $45,422 | $49,033 | $52,773 | $56,691 | $60,682 | $64,891 | |
|
90 |
Yes | $46,744 | $49,127 | $51,637 | $54,332 | $57,260 | $60,285 | $63,568 |
| No | $31,056 | $34,429 | $38,054 | $41,894 | $45,887 | $50,148 | $54,538 | |
|
95 |
Yes | $40,808 | $42,880 | $45,255 | $47,783 | $50,457 | $53,464 | $56,717 |
| No | $24,618 | $27,699 | $31,232 | $35,208 | $39,362 | $43,752 | $48,358 | |
|
100 |
Yes | $36,794 | $38,783 | $41,003 | $43,361 | $45,951 | $48,773 | $52,000 |
| No | $20,474 | $23,190 | $26,425 | $30,330 | $34,905 | $39,569 | $44,322 | |
Single: Retiring at 75
|
Money lasting until age |
Eligible for Age Pension? |
Return on savings |
||||||
|---|---|---|---|---|---|---|---|---|
|
2% |
3% |
4% |
5% |
6% |
7% |
8% |
||
|
85 |
Yes | $76,618 | $79,543 | $82,535 | $85,564 | $88,712 | $91,954 | $95,336 |
| No | $62,907 | $66,401 | $69,973 | $73,651 | $77,410 | $81,253 | $85,174 | |
|
90 |
Yes | $56,757 | $59,358 | $62,154 | $65,044 | $68,100 | $71,234 | $74,543 |
| No | $41,956 | $45,422 | $49,033 | $52,773 | $56,691 | $60,682 | $64,891 | |
|
95 |
Yes | $46,744 | $49,127 | $51,637 | $54,332 | $57,260 | $60,285 | $63,568 |
| No | $31,188 | $34,440 | $38,036 | $41,893 | $45,887 | $50,148 | $54,538 | |
|
100 |
Yes | $40,737 | $42,883 | $45,268 | $47,783 | $50,457 | $53,464 | $56,717 |
| No | $24,905 | $27,735 | $31,065 | $34,902 | $39,254 | $43,772 | $48,358 | |
Assumptions
- You own your own home and have personal assets of $25,000 or less. These calculations do not allow any investment assets outside super. Note that the amount of investment assets you have can greatly affect the amount of Age Pension you are eligible for.
- Inflation costs are a 2% rise per year in cost of living plus an 1.2% additional rise per year in living standards
- All returns are net of fees
- Results are in today’s dollars
- We recommend you also review the assumptions that MoneySmart list below their calculator
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My husband and I having a smsf for the last 16 years and now 70 years of age are living off the earnings from our balance of $800,000 last financial year we achieved 13.1% and are happy about that we do not receive a Centerlink pension and hope to continue doing this for the next 10 years if we are fortunate to live that long
We travel overseas and buy what we want enjoying the proceeds of our hard work
I can’t see that we will need this amt after 80 years of age
As our spending on travel etc will drop off
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