Calculate how to reach your super balance goal

To use the tool, insert your personal details and select your planned retirement age and your retirement balance goal (in today’s dollars).

The calculator will then display the suggested mix of contributions that are estimated to reach your retirement target while maximising tax benefits and government co-contributions.

If you are eligible for a co-contribution, you will see it displayed in the detailed breakdown of your results. You need to add the co-contribution amount to the displayed tax benefit of salary sacrifice (if any) to see the total benefit of your contributions.

The results are shown in today’s dollars, considering estimated inflation of 2.5% per year.

If you would like to edit the assumptions, including estimated investment returns, wage growth, insurance premiums, fees and inflation, click ‘disclaimer and assumptions’ on the welcome page before using the tool. You can then select the ‘edit assumptions’ tab to adjust these figures.

If you do not adjust the assumptions, the tool includes AustralianSuper’s approximate fees and a ‘moderate’ investment return of 6.5% during the accumulation period.

Be aware the calculator will never suggest contributions that exceed the contribution caps. If you are eligible to carry forward unused concessional contribution cap space from prior years, you will need to account for this yourself.

Shristi is 30 and a single parent working part time. She is currently earning $50,000 per year and her super balance is $60,000.

Shristi has read that a single person needs $595,000 in super at retirement to be comfortable, assuming they also receive Age Pension and own a home, so she would like to aim for her super balance to reach this target at age 67.

Using this retirement balance goal, the calculator estimates Shristi should contribute $1,453 per year by salary sacrifice and $563 per year after tax. To implement this strategy, she would need to be able to afford to save a total of $1,493 per year (a $930 reduction in take-home pay due to salary sacrifice plus $563 after-tax contribution from her bank account). This is just under $30 a week.

The calculator shows this would generate a net benefit of $305 per year – but this is only the tax saving Shristi would make from salary sacrificing. She would also receive $281 from the government’s co-contribution scheme in return for her after-tax contribution.

The tool estimates that by making these additional contributions, Shristi can increase her super balance by almost 27% at retirement.

Chris is 40 years old and has already been saving in super for a few years, building his balance to $250,000. He has a goal to retire at 60 with a super balance of $1 million, and his current salary is $130,000.

For a retirement target of $1 million at age 60, the calculator estimates Chris will need to salary sacrifice $9,635 per year. This will reduce his take-home pay by $5,877 per year ($113 a week).

The results show that the annual tax benefit of this strategy for Chris is $2,312. This is the difference between the income tax he would pay if he took the salary as cash, and the 15% contribution tax for pre-tax super contributions.

These contributions are estimated to boost Chris’ final retirement balance by approximately 28% – from $780,000 to $1 million.

Juan is 25 years old and is just starting his career as a carpenter. He has set up his own business as a sole trader, has $5,000 in super and expects to earn $110,000 per year after expenses.

Juan would like to retire at 67 with $850,000 in super. He sets the employer contribution level to zero in the calculator, as he will not be receiving contributions from an employer.

The results estimate Juan will need to save $12,755 before-tax each year to reach his goal.

As he is self-employed, he cannot salary sacrifice through his employer, so he will need to make these contributions from his savings and submit a notice of intent to claim a tax deduction to his super fund. This will make his contributions tax deductible in his personal tax return.

The calculator shows that this level of contribution will reduce Juan’s after-tax income by $8,354 per year (approx. $160 a week) thanks to the benefit of the tax deduction, generating an annual tax benefit of $2,487 and taking his final super balance from almost zero, if he makes no contributions, to his goal of $850,000 at age 67 with the suggested contribution level.

Juan is interested to see the impact of choosing a different investment option for his super balance, so he resets the calculator assumptions to include a high-growth option. With this adjustment, the estimated contributions required drop to $10,056 per year, thanks to higher investment returns.

Next steps

If the contribution amounts suggested by the calculator are affordable for you, it’s time to put your strategy in practice.

• To arrange salary sacrifice to super, contact your employer.
• To set up regular or one-off contributions from your bank account for any after-tax or personal tax-deductible contributions you need to make, visit your super fund’s website or get in touch with their contact centre .

If the contributions are not affordable, don’t lose hope. It’s better to contribute what you can afford than nothing at all. You may like to restart the calculator and have it recalculate the best mix of contributions by selecting the option to contribute what you can afford instead of a retirement balance target.

You can revisit the calculator as your salary and super balance changes to track your progress and see how the suggested contributions change over time. Reviewing your strategy is important because super rules and contribution caps change frequently, and your changing salary will determine the most advantageous mix of contributions.