Why super matters: 20 years of rising costs for a comfortable retirement

New Association of Superannuation Funds of Australia (ASFA) Retirement Standard figures show that over the past 2 decades the cost of a comfortable retirement has increased by 75%.¹

The figures underline why it’s never been more important to stay on top of your super, understand what type of retirement you’d like, and continue to consider ways to help grow your super.

ASFA first created its Retirement Standard 20 years ago to help give a clearer understanding of what retirement lifestyle your savings may give you.

The figures are updated quarterly to reflect inflation and provide detailed budgets of what singles and couples, who own their home, would need to spend to support a ‘comfortable’ or ‘modest’ lifestyle in retirement.

The September quarter 2024 data shows that couples aged 65-84 need to budget $73,031 annually to achieve a ‘comfortable’ retirement, while singles need $51,814.

This equates to $595,000 in superannuation savings for a single person retiring at age 67, and $690,000 for a couple retiring at age 67.

To retire ‘modestly’, the September quarter 2024 figures suggest that single people will need to budget about $32,930 a year and couples will need about $47,475 per year.

20 years of the ASFA Retirement Standard 

The ASFA Retirement Standard captures the costs of essentials like health, communication, clothing and household goods. 

Over the past 20 years, the Retirement Standard figures show the cost of a comfortable retirement has increased by 75%, with modest budgets almost doubling.¹

Price increases for necessities and shifting community needs, such as the inclusion of private health insurance in retirement, have contributed significantly to these increases, according to ASFA.

Retirement Standard changes 2004 to 2024

Source: 1.ASFA, Superannuation peak body: Retirement costs finally fall, just in time for Christmas.

What has changed

We’re living longer
About 30 years ago, life expectancy in Australia was 74.5 years for males and 80.4 years for females.² By 2020-22, the Australian Bureau of Statistics reports that life expectancy had risen to 81.2 years for males and 85.3 years for females. All of which means we will live longer in retirement, so our retirement savings, including super, will have to last longer.

Healthcare costs
Living longer can also lead to higher medical bills. For many retirees, private health insurance has become a must.³

Lifestyle expectations
Everyone has a different idea of what they want to do when they retire. For some it's about relaxing, reconnecting, or spending time with grandchildren. But for others it's about action, adventure, and travel. And that costs money.

Cost of essentials has increased
As well as action, adventure and travel, the cost of essentials has increased. Here’s some examples of price increases over the past 20 years.

Source: 1.ASFA, Superannuation peak body: Retirement costs finally fall, just in time for Christmas.

Ways to grow your super

So, how much super do you need for a comfortable retirement? For many it’s a tricky question with 55% of Australians not sure they will have enough set aside for their retirement.⁴

But if you feel your super balance may be falling short of your expectations for retirement, there are still plenty of ways to help grow your super. These include:

• Consolidate super accounts⁵
  Finding and consolidating lost super into one account could save you money on fees and help your retirement funds grow. We aim to make it easy to search for lost or forgotten super and combine it into one account through Member Online.
• Salary sacrifice to your super
  Paying money into your super from before-tax salary means less income tax while you grow your retirement savings.
• Make voluntary contributions
  Even small amounts from your after-tax pay each week or month may make a big difference to your savings, and you may be eligible for a tax deduction.
• Top up your spouse's super
  Contributing to a spouse’s super could attract a tax offset of up to $540. (Eligibility and conditions apply.)

We’re here to help

Login to Member Online to check if your super is on track.

Find out more about our advice options. Advice about your account with us is included with your membership.⁶

1. ASFA media release, Superannuation peak body: Retirement costs finally fall, just in time for Christmas, accessed 10 December 2024.
2. Australian Bureau of Statistics, Life expectancy report, accessed 11 December 2024.
3. National Seniors Australia, media release, Private health insurance premiums go up again, accessed 11 December 2024.
4. Survey of 1000 Australians carried out by IPSOS on behalf of Australian Retirement Trust, September to November 2023.
5. Before you consolidate, think about whether it’s right for you. You could lose access to benefits such as insurance or pension options, and you need to consider tax implications.
6. Employees in the Australian Retirement Trust group provide advice to members and employers as representatives of QInvest Limited. QInvest Limited (ABN 35 063 511 580, AFSL 238274) is wholly owned by the Trustee as an asset of Australian Retirement Trust. QInvest Limited is a separate legal entity responsible for the financial services it provides. Eligibility conditions apply. Refer to the Financial Services Guide at qsuper.qld.gov.au/disclosure for more information.