The average retirement age in Australia is 55 However, the average age people aged 45+ said they expected to retire – 65.5 years – was much later than the average retirement age. And on average, Australians can expect to live to 85 for women and 81 for men (ABS, 2021).
When do most Australians retire? According to the Australian Bureau of Statistics (ABS), the average retirement age for people aged 45 years and over is currently 55.4 years (this figure also includes people who had left their last job due to illness, injury, job loss, and other reasons).
Retiring Between Ages 41 – 45 (The Best Age Range To Retire)
You're likely in your prime earning years, making leaving your job that much harder. But after 20+ years of work, you won't feel as much shame retiring or taking things down a notch. After all, you've been working longer than the time you spent in school.
The ASFA Retirement Standard Explainer says a comfortable retirement lifestyle would need $640,000 in super for a couple, or $545,000 for a single person.
60 may not be too early to retire, but it is too early for Social Security. The good news is that retiring at 60 is much easier than retiring at 55, as penalty-free withdrawals from IRAs begin at age 59 1/2. But that's not to say it's always easy.
The finding echoes a few others, the New York Times reports: “An analysis in the United States found about seven years of retirement can be as good for health as reducing the chance of getting a serious disease (like diabetes or heart conditions) by 20 percent.
The above chart shows that U.S. residents 35 and under have an average of $30,170 in retirement savings; those 35 to 44 have an average $131,950; those 45 to 54 have an average $254,720; those 55 to 64 have an average $408,420; those 65 to 74 have an average $426,070; and those over 70 have an average $357,920.
ASFA estimates people who want a comfortable retirement need $640,000 for a couple, and $545,000 for a single person when they leave work, assuming they also receive a partial age pension from the federal government. For people who are happy to have a modest lifestyle, this figure is $70,000.
A 65-year-old can expect to live another 19 to 21.5 years, on average, according to the Social Security Administration. What's more, the government agency says a third of 65-year-olds will hit age 90, and 1 in 7 will live beyond age 95.
Financially speaking, it's generally far safer and far smarter to retire later. According to a Boston College Center for Retirement Research report, half of today's working families risk a major living standard decline in retirement. The share would drop by roughly 50% if all workers were to retire two years later.
You Have Ample Savings
You planned and set a goal for retirement savings. Now your investments meet or exceed the amount you were hoping to save. This is another good sign you could take early retirement. If you didn't plan for early retirement, you will need to recalculate how long your savings will last.
Retirees generally no longer need to spend money on children or work-related expenses. According to the Association of Superannuation Funds of Australia's Retirement Standard, to have a 'comfortable' retirement, a couple who own their own home will need an income of about $67,000.
Yes, for some people, $2 million should be more than enough to retire. For others, $2 million may not even scratch the surface. The answer depends on your personal situation and there are lot of challenges you'll face. As of 2023, it seems the number of obstacles to a successful retirement continues to grow.
The average retirement age in Australia is 55
However, the average age people aged 45+ said they expected to retire – 65.5 years – was much later than the average retirement age. And on average, Australians can expect to live to 85 for women and 81 for men (ABS, 2021).
But, generally speaking, most experts agree that you will need 70-80% of your pre-retirement income to maintain your standard of living in retirement. For example, if you earned $50,000 per year ($4,167 a month) before retiring, you would need approximately $35,000-$40,000 per year in retirement.
How much money do you need to be considered rich? According to Schwab's 2022 Modern Wealth Survey (opens in new tab), Americans believe it takes an average net worth of $2.2 million to qualify a person as being wealthy. (Net worth is the sum of your assets minus your liabilities.)
Average monthly expenditures for those 65 and older — including rent, groceries and healthcare — stand at around $4,345, according to the latest government data.
Can I Get the Pension if I Have Super? Having superannuation savings does not deny you from receiving Age Pension payments. Eligibility for the Age Pension is based on an Assets Test and an Income Test.
A recent study determined that a $1 million retirement nest egg will last about 19 years on average. Based on this, if you retire at age 65 and live until you turn 84, $1 million will be enough retirement savings for you.
The Association of Super Funds of Australia (ASFA) claims it's $640,000 for couples and $545,000 for singles. The reality is most Australians retire with far less in super. Indeed, the average super balance for Australians aged 60-64 is just over $300,000. That may be enough.
The rule works just like it sounds: Limit annual withdrawals from your retirement accounts to 4% of the total balance in any given year. This means that if you retire with $1 million saved, you'd take out $40,000 the first year. Even so, you'd also adjust this amount annually for inflation.
Early research on the relationship between retirement and happiness is derived from psychology, and mainly describes the relationship between retirement and happiness. These studies concluded that retirement is associated with lower life satisfaction, depression, and lower happiness (9, 10).