The Australian Retirement System

Australia's retirement system is built around superannuation — a mandatory long-term savings account separate from your regular bank accounts. Your employer currently contributes 11.5% of your gross salary (rising to 12% by 2025). The average Australian retires at 65 with $300,000–$500,000 in super, but ASFA estimates a comfortable retirement requires $595,000 (single) or $690,000 (couple) at retirement.

Step 1: Make the Most of Super

  1. 1

    Consolidate multiple super accounts

    The average Australian has 2–3 super accounts from different employers — each charging fees. Find all your accounts at myGov → ATO → Super, then consolidate into one low-cost fund. Multiple accounts paying multiple sets of fees significantly erodes your balance over time.

  2. 2

    Choose a low-cost, high-performing fund

    Super fund choice matters enormously. A fund charging 1.5% fees vs 0.5% fees on a $300,000 balance costs you $3,000 more per year — over decades this compounds to hundreds of thousands. Check your fund's 10-year return and fees at moneysmart.gov.au or superratings.com.au. AustralianSuper, Hostplus, REST, Aware Super and Cbus consistently rate well for balanced options.

  3. 3

    Check your investment option

    Most super funds default new members to a "Balanced" option. If you are under 50, a higher-growth option (more shares, less bonds/cash) typically produces better long-term outcomes. Shares outperform bonds over long periods — the longer until retirement, the more growth-oriented your investment mix can be. Switch to a growth or high-growth option via your super fund's online portal.

  4. 4

    Make voluntary contributions

    Concessional (pre-tax) contributions up to $30,000 per year (including employer contributions) are taxed at 15% — much lower than most people's income tax rate. Salary sacrifice — directing a portion of your pre-tax salary into super — is the most tax-effective way to increase your retirement savings if you have surplus income.

  5. 5

    Non-concessional contributions

    After-tax contributions up to $120,000 per year (or $360,000 over 3 years using the bring-forward rule) can also be made. These are not tax-deductible but your money then grows in the low-tax super environment (15% on earnings, 0% on retirement income in many cases).

Outside Super

  • Index fund investing: As discussed in our index funds guide, regular contributions to low-cost ETFs (VAS, VGS) outside of super provide flexibility — you can access this money before preservation age unlike super.
  • Property: For many Australians, the family home and investment property form a significant part of retirement assets, though concentration risk in property is worth considering.
This is general information, not personal financial adviceSuperannuation strategy depends significantly on your age, income, existing assets and goals. Consider speaking with a fee-for-service financial adviser (not commission-based) for advice tailored to your situation.

Frequently Asked Questions

Rough benchmarks: by age 30 — 1x annual salary. By 40 — 2.5x. By 50 — 4.5x. By 60 — 7x. By 65 — 9–10x. These are guides, not rules — individual circumstances vary significantly. Use ASIC's MoneySmart retirement planner (moneysmart.gov.au) to model your specific situation.
Generally no — super is preserved until you reach preservation age (currently 60 for most Australians) and retire, or turn 65 regardless of working status. Limited early access is allowed in specific circumstances: severe financial hardship, terminal illness, permanent incapacity, or amounts below $200. The government's COVID early release scheme was a one-off exception, not an ongoing policy.