Are your savings on track to give you a comfortable retirement

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SUPER fund balances need significant fattening to catch up to the amount required to deliver a comfortable lifestyle come retirement.

New figures released by the Association of Superannuation Funds of Australia show balance targets are falling behind and immediate action needs to be taken to ensure the shortfall can be made up.

ASFAs Superguru retirement standard shows single people will need $545,000 in retirement savings and couples will need $640,000 to give themselves a comfortable lifestyle.

The data shows for a single person aged 30, females have a balance of $25,000 and males have $30,000 but to be on track to achieve a comfortable retirement they already need a balance of $50,000.

For a 60-year-old the findings are more concerning. Average female balances are just $130,000 and males are $250,000, but to achieve a comfortable retirement they should have $425,000.

But ASFA chief executive officer Martin Fahy says theres some easy steps people can take to help boost their super balances almost instantly.

Whether its finding and consolidating super accounts, salary sacrificing, looking at investment strategies and fees and charges, or simply working out how much money you need to invest to ensure you have enough for the type of retirement you aspire to, everyone should take an interest in their super,’ he says.

Super is your money so you should be actively engaged in monitoring and managing it.

A modest retirement for Aussies is one considered to deliver more income than the age pension but you can only afford basic activities.

A comfortable retirement is one that allows a wider range of leisure and recreational activities and a good standard of living includes what a person owns, driving a reasonable car, having private health insurance, good clothes and they can travel domestically and internationally.

Both budgets assume retirees own their home outright and have good health and these are their living standards at age 65.

Intrust Super chief executive officer Brendan OFarrell urges people to sit up and take notice of their super balances now before its too late to play catch up.

Mathematically, you have two choices, you can start early with your saving, which means any sacrifices you make early in your career will be bolstered by investment returns and the wonderful power of compounding interest,’ he says.

Alternatively, you can start late and start big by waiting until later in your career, youll need to make bigger sacrifices to catch up, and even if this is the choice you make you may be hindered by various types of contribution caps that limits the amounts that can be contributed.

@sophieelsworth

HOWS YOUR RETIREMENT TRACKING?

Single person earning $70,000 per year

Age What you need to be on track for comfy retirement What females have Males have

30 $50,000 $25,000 $30,000

40 $175,000 $45,000 $70,000

45 $215,000 $64,000 $100,000

50 $275,000 $80,000 $140,000

55 $345,000 $105,000 $190,000

60 $425,000 $130,000 $250,000

Source: Association of Superannuation Funds of Australia.