How Much Do You Need to Retire on $100,000 a Year?
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- Опубліковано 16 чер 2024
- Find out exactly how much you need to be able to retire on $100,000 per year.
I’ll also show you why people work years longer than they need to and miss out on their best retirement years.
Are you aiming for a retirement income of $100,000 per year?
We’ve crunched the numbers to show you the lump sum required to achieve this retirement income target. Whether you’re single, married or partnered, this video covers how much you’ll need to save to retire at 60 or 65 and how long your money will last.
Once you understand how much you will need to retire on $100,000 per year, you can alter the amount to be more aligned with your specific retirement income needs. Because although $100,000 per year would be nice, do you really need that much to retire?
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► How Much Super Do You Need to Retire At 60: bit.ly/3dzy1E1
⏱ Timestamps
00:00 - How Much Do I Need to Retire on $100,000 Per Year?
00:46 - Standard of Living
02:03 - Amount Required Considerations
02:31 - Retirement Ages & Amount Required
03:31 - Couple vs Single
04:02 - Difference in Retirement Age
04:30 - Excluding Age Pension
05:14 - Why People Work Too Long
😍 Like this video? Please hit the thumbs up button👍 and leave us a comment below. ⏬
*How Much Do I Need to Retire on $100,000 Per Year*
Are you aiming for a retirement income of $100,000 per year?
We’ve crunched the numbers to show you the lump sum required to achieve this retirement income target. Whether you’re single, married or partnered, this video covers how much you’ll need to save to retire at 60 or 65 and how long your money will last.
Once you understand how much you will need to retire on $100,000 per year, you can alter the amount to be more aligned with your specific retirement income needs. Because although $100,000 per year would be nice, do you really need that much to retire?
#SuperGuy #ChrisStrano #Superannuation #RetirementPlanning
DISCLAIMER: The SuperGuy website and SuperGuy UA-cam channel contains general advice only. It is not personal advice as it does not take your specific needs or circumstances into consideration. Therefore, you should look at your own financial position, objectives and requirements and seek personal financial advice before making any financial decisions.
General advice is provided by Toro Wealth Pty Ltd trading as SuperGuy Retirement Experts as an Authorised Representative of Core Value FA Pty Ltd (AFSL 480387).
Before acting on any information, you should seek professional advice and verify our interpretation/s before relying on the content or calculators within this website or on the videos, while also considering its appropriateness in relation to your personal situation.
Well, I'm 70 and fully retired for some years now. When I had my 21st birthday my mother told me to start planning my retirement then. Seemed ridiculous at the time but I took her advice and started my investment journey. Its had ups and downs but our income per year now is more than 100K and we live pretty well. A new car every 5 years, private health insurance and two overseas trips a year plus we also have enough to help out the kids with their mortgages. No govt pension of course. The secret, if there is any, is to start early to get the benefit of compounding.
Great first-hand advice. Congratulations... I'm sure there were plenty of sacrifices and lessons along the way.
@@SuperGuyAu Yep, there were. There are so many more options these days to grow your wealth. ETFs didnt exist back in the 70s. Stocks like CBA and Qantas were still owned by the government and you got a piece of paper when you bought stock. Hill Samuel was the first CMA and who knew it would grow into the behemoth Macquarie Bank. How times have changed.
Ok@@roberre164
@roberre164 Your mum had you right. The power of compound interest. I wish more would get that message.
Indeed. Start early, don’t give up, a good outcome is achievable.
These Retirement advice videos are so useful Chris - keep them coming !
Great info.
Liking your channel 👏👏👏
Thanks for watching
@SuperGuy Love your work.
Can you tell us why you chose a 5%return for the example? It seems a little low.
Are the figures indexed on inflation 2.5% including pensions and thresholds?
Also really keen to see if you produce something like a stepped spend.
For example decade 1 from 60yo 100k, decade 2 90k, decade 3 80k or such
I'm 45, female and retired. I moved out of Australia to be able to do this and live more than comfortably on 50k per year. I started planning in my 30's. It is never too late
Where did you end up living?
You'd want somewhere politically stable.
@w0mblemania nah, political stability is overrated… would rather have a good time than a long time
@@jamessmithson-br7rm Lol.
Political stability is very important.
It's very hard to invest your life savings or plan for the future if the regime takes away your savings.
I want a good time AND a long time.
But, you do you.
Nice format in these videos. Thanks for sharing. A question I always have when seeing super videos is what is meant by retiring on 100k per year. 100k when? 100k now may seem sufficient but 100k in 20 years won't even cover living expenses. The disclaimer says a 2.5% rate of inflation is accou ted for but 100k is 100k. How is the decreasing value of money factored in when the 100k sum remains constant?
If you are not bothered about being near family and not really going to get much pension then the other consideration is to spend some of those earlier retirement years (e.g 60 to 70) living in South East Asia somewhere (Malaysia/Thailand/Vietnam etc) as your cost of living will be much lower + you get the benefit of relatively lower cost travel. a 5hr radius flight from KL gets you to a lot of cool different cultures to experience / adventure etc. You will need to have private healthcare insurance though. You may find the cost of private healthcare etc reaches a tipping point in which case it may make sense to return to Aus in those later years (75+). And if not living in Aus then you can rent your home out too which can cover a huge portion of your cost of living in S.E Asia. (I am comfortably retired : but my cost of living in SE Asia is < 30k/year and i have a really good lifestyle of keeping fit and healthy and travelling a lot in a safe friendly environment.) KL to Perth isnt too far/expensive to fly if needed.
I’ll be retiring not long after 60, no ifs or buts! I’ve spent most of my working life doing shift work so want that to end as soon as possible. I’ll live my lifestyle according to what I have in super, I should be able to enjoy a few overseas trips and regular domestic travel. That’ll do me!
I’m sorry work hasn’t been fulfilling. It is such a large part of our lives.
Great video. As previously mentioned, it would be good to get a figure for maybe 70 and 80K p.a. over 20 years if you retire at 60. Thanks.
I was smart/lucky enough to get into a defined benefits scheme at age 18 just before the scheme was closed to new entrants. I’ve contributed an average 6% salary for the past 37 years. Now, I’m 5 years away from retiring at 60 with a $2.3M payout. That decision as an 18 year old was the best I ever made.
So helpful! thanks Chris.
Agree. This is helpful.
You're welcome. Glad it helped.
Thanks for the video. Would like to see more breakdown though on retirees who don't own property, that they live in (i.e not renting it out as an investment property and therefore not assessed when applying for age pension) and who are not eligible for the aged pension (exceed assets test threshold). Owning a property and not owning a property (i.e. renting) used as a primary place of residence makes a huge difference to what you need. Rent can vary of course. But a table could break that down based on rent brackets.
There are many asset-rich cash-poor old age pensioners getting full pension, owning properties, that are their primary residence, in the million to millions of dollars. Whereas there are self funded retirees with much less wealth, cannot afford to own a property to live in and (therefore pay rent) but have investments and subsequent income streams that exceed the assets test thresholds for a pension or at best a greatly reduced pension, but overall are lucky to be much more than what a full old age pension amount is.
Would be nice if the government recognized this by making the threshold higher for those not owning and living in their own property.
Hello Chris, 100K Tax free would be an amazing life, But having watched a few of your videos today is this a reality! I saw your video on the Bureau of Statistics Super balances and working on a self-preservation age of 60 the "Average" Balance was (rounded up) 360K With the "Mean "being 180K - This is a long way off from 1.5M to receive 100k - From me my Super Balance is better than the Average but not looking like 1.5m anytime soon.
We are 70 and 75 and travel full-time. We own no real estate. Our budget is $100K a year (US dollars-we’re Americans). Our social security is 70K a year and we take 30-40K a year from our investments that total $750K. It should last until we join the chorus of the singing void!
NO. That's not enough, you must work until you have 3.5 million in the bank. Go back to work and stop being a leech. :)
That was before the inflation of the last 4 years> You are going to be screwed.
Awesome- I could live OK on $100000 US. Hell, I could raise a family on that social security alone. Ours in Australia isnt quite so generous. All the best.
Here in Oz if you had the equivalent of $750k you would not get any social security (the equivalent).
By the time I retire, I've heard that my social security benefit will be reduced by 30%. Such it is for my generation. Learning to pinch my pennies now.
I'm having trouble reconciling the Assets and Income Tests results. If someone has say $800k in super assets, the Assets test seems to reduce the age pension by a lot more than the Income test using deemed interest earnings on $800k
About 5 minutes before I get put into a retirement home, I'm setting sail NE into the Pacific with tiller lashed - adios! Never ever ever.
GOOD LUCK WITH THAT.!!!
WHY DO YOU SAY THAT? (in capitals?). Upsetting? Don't like water?@@vicgallimore6756
Can I come with you? Aged care . . . ughhh!
Thanks for the very intuitive one! I am just wondering how one can be eligible for age pension while having 1.3m to 2.5m (as in the first table) of net asset? Please help me understand the logic. Cheers 😅
Eventually eligible as assets deplete over time.
It's based still on super, and that is a problem considering the harm it is starting to do from the super funds. And the changes the union super funds want should send shivers down the spine of anyone.
But it is interesting how much of a investment portfolio you would need. Little off it yet lol
How do you get an age pension in Australia with assets over $900,000
Perfect and really useful, thanks. I'm 61, will retire at 63 and closing in on $1.6M, with intention of it lasting 20 years. cheers.
You're welcome. Thanks for commenting.
How can those ppl be eligible for the pension when they have such high savings? I thought you couldn’t get it once you have $1m or so.
I so wish I had put more money into my super compound interest is one of the best kept secrets - I’m approaching 64 and only have $400k in my super - I’m close to owning my home though it requires major renovations
This is true. Compounding interest in a concessionally-taxed environment can be very beneficial.
Thanks
You're welcome!
The main reason isn't a higher income desired... It is sequence of return risk. The what if. All your scenarios assume the market just earns them 5%. Most people aren't retiring because they are scared of a market crash and losing their money in the early years of their retirement.
What about those who don't have this sort of money in super. I would suggest many would only have say 300k super. How does one then live? Would love to see videos on this.
All advice around tends to be on the 1million plus.
Yes, this is advice for rich people. What about people with little super who will have a mortgage on retirement?
What’s age pension?
Something that you didn't mention here is that as you get older, the less you will generally spend. If you retire at 65, then spending $100k is quite feasible. But as you progress to your 80s and beyond, many people completely slow down. Less travelling, etc. Therefore you would require a lot less money.
So true. Many so called financial experts are not real life experts, because they are not there yet.
Exactly. Some of my relatives are 80 years old and get compulsory super withdrawals of $150k per year. One was complaining recently that he would be lucky to spend $30k per year and the rest is just piling up in his bank account. I’m suggesting he send it to his nephew, me and I’ll spend it on wine, women and song, and the rest I’ll simply waste 😂
@superwag634 🤣 sadly I have no such relatives.
I think the stats show something slightly different. As you reach your 80s, healthcare costs may start to increase, as will costs of living as many tasks you used to undertake yourself (e.g., cleaning, gardening) may/will need to be paid for. There are also things like taxi fees once you lose the ability to drive, etc. So it's not just a simple reduction in costs as you age.
@@z3lda808 so true.
It would be nice to see some projections where a coupe retires at 60 with spending of $100K pa for the first decade, then living expenses drop $10K-$15K each successive decade. What retirement amount would be required to retire at 60 for this scenario?
That would happen anyway due to inflation. $100K won't get you as much in 30 years' time.
@@pm69his numbers already account for inflation though.
Living expenses won't necessarily drop. As healthcare needs change, expenses will also change (usually for the worse).
surely that is taken into account ie it's 100k adjusted for inflation@@pm69
Why do you care about a fictitious scenario…. that isn’t going to happen 😂😂😂
Most people don't understand the costs of Aged Care. They go into a retirement village thinking they will leave in a box or that they won't need care and will stay in the family home until they die. Wrong! Once you are unable to look after yourself, Aged Care is a common solution (not the only one I know) and requires minimum $500K as a deposit, plus a daily fee, which can be hundreds of dollars a day (as well as taking your full pension). OK, so maybe you've spent it all and rely on the pension only, there can be "concession" placement available if you're lucky. However, you don't know when it's going to happen and if you've been planning adequately then you are bound to have assets that are deemable. Just going through this with my father. It's heartbreaking!
Aged care facilities that are subsidised by the government are not allowed to reject those on the aged pension with limited assets, if the facility is not fully occupied. And they can't take all your aged pension. Only about 85%, leaving some money for incidentals like newspapers, new clothing, hair styling etc. There is no obligation to pay the "deposit", which is fully refundable on leaving the facility. Residents can pay a higher daily accommodation fee instead if they don't have the full amount on entry. Been there, done that with the old man.
@@johnoneill1011 “residents can pay higher daily accommodation fees instead” is exactly what I’m talking about. This can amount to hundreds $ per day. Many aged care facilities are also charging extras package like newspapers, alcohol, etc as mandatory and no longer optional ( in WA). We chose one with extras optional but deposit is $650k. The village that my father has left is going to take 6 months to rennovate and also charging him monthly fees. Therefore can’t pay deposit until it sells. Also govt deems the RAD as means tested whereas while you still own the property it’s not. Double-dipping IMHO.
Thanks for the video! I just wondered why the low withdrawal rate if you're making 5% return p.a. In theory you would die without ever touching the principal. If you withdrew $150k p.a. on $2.5m you would only deplete the capital by 1% per year. or $25k. As you get older you will naturally spend less so doesn't this make sense to spend some of the money you spent years accumulating?
Thats not quite how it works. If markets have a poor year, you are eating into the capital -on a Good year, you arnt.
The key to retirement is to Retire, and live a lifestyle that is condolement with your funds but you will need good financial planning.
No. The key to retirement is never to retire. Even a small part time job will give you that extra mental edge to enjoy your money longer than to have to use it for care.
Buy a reasonably priced caravan not a big black one, rent your house out to pay for your trip and drink cask wine. Sorted.
Been semi retiring since 50 work less by being frugal thrifty minimal and less consumption travelled heaps spent lots of time with family now
Really? Would that cover rent/body corp/rates & insurance etc.?
I've read a number of articles that say typical growth of your super in the accumulation phase is less than 7%. Most of the super forecasting calculators don't let you plug in anything more than 6-7% growth. Is this realistic or are they simply being really cautious? I also see recommendations to reduce your risk profile the older you get which may explain that logic. My super has been seeing 9-10% growth on average over the years, I see no reason why I cant continue that even when in accumulation.
We've been in a fortunate decade with a strong economy (excluding Covid blip) and strong returns. With an aggressive portfolio, you should consider the implications on your retirement if your super balance was to fall 30-40% in your first year of retirement, while you are also drawing an income from it. I think average long-term returns of 6-7% is used because retirees tend to reduce risk and aim for more certainty of outcome throughout retirement.
problem in when i want to retie $100000 will be the average weekly grocery shop
future projections are usually calculated on what a dollar is worth today
Based on this information I will never be able to retire & will continue to work until the day I die - wow, what a pleasing thought (NOT) to now live with for the rest of my life.
I wasn't aiming for any particular amount per year when I started savings in super in my 30s. Compulsory super only just started at 3% of gross income. I became self employed anyway, so it was up to myself to save in super. Most of the time I do the maximum allowed at 25k per year purely for tax advantage, reducing my gross income. With the benefit of time, the balance snowballed greatly since my mid 50s, last year exceeded my own income. I have seen too many poor retiree, living in the outskirt of Newcastle in a weatherboard home. Eating sausage and mash for their tea. They didn't have many options. This year after turning 60 I will start a transition to retirement and work less. If I have spare money I would put into my adult children's super to give them a boost.
Every kid should receive 10k at birth-invested for life. Only accessible at 60 if you've been a Good boy and stayed off the gov nipple. Any welfare received during your working years should be deducted from this 'pension' fund. The fund cannot be inherited at death. I haven't done the math on this-just a whim. 10k would be a shitload at 7% return above inflation (aggressively invested of course).
With that amount in assets shown in all of the examples, wouldn't that preclude you from aged pension eligibility anyhow?
Initially, yes. But as your asset base inevitably declines to a certain point, your would become eligible eventually - even if only for a few short years before running out of money entirely.
How should people on pensions plans like teachers and other state employees be investing their money for max returns in retirement?
Get rid of non tax effective debt and put your money into a top-up (super) plan as early as possible . . . and keep on doing it. Stay away from retail super funds offered by the big end of town.
I'd love to see you do a vide on someone who want's to retire at 50 and what needs to happen.
I'm 45 and retired. I left Australia to be able to do this. My investments bring in around 50k a year and i live on 36k of that so i haven't had to touch the principle. You will ask me how but many will scoff. It's a mix of income from properties, savings and money made in the last crypto bullrun. I am set to make 1 mill+ in this run too. Love it or hate it, it's how i did it. Good luck to you!
I retired at 49 due to physical ailments. I own my home and am living off 4% of my managed funds which is mainly dividends to reduce eating too far into the capital. Another 2% is going into super and management fees, The plan is to have the maximum super in draw down pension phase that is tax free after I turn 60. My living costs aren't bare-bones FIRE style frugal but are certainly not extravagant
Advisors often generalise that in retirement you need about 70% of your pre-retirement income to live a similar lifestyle to when working. So, if you retired after earning $140k p.a. (e.g. retiring state high school department head), you might expect to live well on $100k p.a., assuming no debts and a fully owned home and car with no need to renovate for a decade or more. Superguy suggests you would need about $2m in super. If you joined NSW Dept of Education 35 years or more ago, you're sweet because that's about the indexed tax free reversionary defined benefit pension you will receive. If you joined after that, there is no DB pension for you, so good luck finding that $2m unless you have a partner who also worked for several decades. BTW, that $140k pre-tax income is about 50% higher than most folks .
Defined benefit funds are getting phased out, which is unfortunate for some, but probably also unsustainable due to an aging population. I don't think many people actually need $100k for retirement - I just ran the numbers!
@@SuperGuyAu If retirement was just about "need" why bother living that long to suffer the aches, pains, surgeries and other indignities of old age? Retirement should be about wants and indulgence in things you could not consider until you got your hands on your super on retirement. We have zero debt. Between us we are obliged by government to withdraw about $180k p.a. via super pensions. It (and a lot more from elsewhere) gets spent, but not all on us. That's what grandkids are for: to soak up what you don't spend on yourself or charities.
@@johnoneill1011 Your grandkids are lucky for getting spoiled! 🙂
A lifetime annuity for $2M gets you about $100,000 a year indexed to inflation - 65yr old - Challenger.Low risk and tax free if superannuation used.
wouldn't the company aim to reduce the life expectancy for that sort of money?
Hehe @@Woodland26
If you do end up doing a video that talks about renting (as a couple comments have mentioned) - could you address a topic I’ve not seen discussed anywhere?
That is…assuming you have somewhat of a reasonable balance in super…do you lump sum and buy a house on retirement? Would the viability change depending on different balances? etc etc.
As some comments suggest…many are looking at renting. But super potentially provides the opportunity to buy a house outright, on retirement?
For peace of mind alone (insurance against rent inflation) along with better pension treatment for homeowners…it seems like a wise option? But be keen to know your thoughts and any numbers you can run 👍🏻
1.6million that's a shopping cart of food in 20yrs...
Well I’m living just fine now on $40 k per year so anything more is a bonus when I retire!
But would I need it🤔
Nice one!
I would like to see a more realistic video on the 50K for singles and 70K for couples.392 liked
It's in the pipeline!
Are you fattening yourself up for a sumo tournament?@@danejames7098
784 liked
My understanding is the age pension cuts out when you have assets of around $1,000,000 for a couple who own there own home. And super balance is counted in the asset test, so you would receive no age pension.
It's more like 1.2m but you're right. That's to get any kind of pension. The full pension qualifier is to have less than about 451k not including PPOR. The gotcha is that to get a pensioner card concession that gives you cheaper health, energy and transport etc you need to be receiving at least a part pension which is why there is a point at which, if you are fully self-funded (do not qualify for part pension) you could actually be worse off financially overall, than someone with less assets and on a part pension.
I think the pensioner card concessions should be on a sliding scale in order to reduce this slightly unfair scenario.
Of course - the pension is a benefit as such - it is not intended as a primary income stream if you have been working and saving for most of your career. The way to more freedom and comfort is to plan for your own independence and that means maximising your investments from an early age - compound growth is your friend and there are very few quick fixes outside of winning the lotto, inheritance, or maybe picking a great stock at the right time ;)
It’s $1.030. Not $1.2m and at $1m you will only get $60 per fortnight
@@paulf763 yeah - sorry - you're right - I was looking at the figure for a non-home owner
Thats true, but this info is based on the aasumption that as you spend it down you are eligible for more pension
In a society where the number of renters is going up is like to see some videos based on people renting until death.
Good point and noted. Will do.
@@SuperGuyAu actually that’d be good. I only looked at it once, a while back, so don’t know the ins and outs like you would…but I know that our pension system benefits homeowners more than renters
Say the average price of a property is $800000; would you (if you had it), pay this amount outright for a house to avoid renting, or keep that money invested and use it to pay for your rent each year? If I had that money it'd be hard to let it all go on a house. Lots of people own homes worth well over a million, which for me is an outrageous amount of money to have invested in a bloody house. People with houses will always appear better off-but thats mostly because they were better off to begin with, and were better with money to begin with, and were also forced to 'save' into their property. Of course, its complicated. If you don't have a house, id be salary sacrificing like a madman into my super.
Well renters get a higher pension, so.. @@stevew4079
@@theowenssailingdiary5239salary sacrificing into super is good but there’s a cap for yearly contributions, after which you get taxed more on those contributions. So you need to have alternative plans for any money you want to invest over that cap.
Retirement seems like a impossibility to me my advise to young people is get a trade as tradesmen dont have to pay tax
Put you money into property as fixing up a property is an excellent way to launder money
Super is a bad investment in my experience as it normally returns less than inflation
Learn to lie really well as it helps
Be good looking looks are the most important thing
Don’t feel bad ripping people off
Where is inflation factored into all of this?
I’m only 30 and one of the questions we have around calculating a retirement number is how do we make sure we’re factoring in the fact that $100,000 today will buy a lot more than $100,000 30 years from now.
Is that what the part where it says 2.5% inflation has been factored in relates to?
Correct - inflation has been included. Therefore, all discussions are $100,000 in today's dollars.
And what about compound interest
This video takes this into account. The superannuation balance is assumed to be earning 5% per year.
Dont complain about Australian retirement funds. In Aus our employer must ivest 11% of you income for you into a superanuation account (like 401K I believe) from the time you start work untill you retire. Should add up to a tidy sum without you even adding to it.
Of course if you do add to it you will be in clover.
I’m 40, I wasted a lot of my early life in very poor paying jobs (e.g., postdoc academic). Finally got a good income the last couple of years. I think I’m pretty boned, for retirement. I am buying my first house at the end of the year. I have a 20%c deposit. I’ll probably just get that paid for. No chance of retirement savings on top of that.
I go a second job, extra 16 hours a week, and salary scarified all that money into super, i am mid fifties, it will make a big difference to me, and it should for you too. I did that second job for 10 months, very difficult, but worth it. And no take away or eating out.
I'm in the same boat but still making a low income despite my best efforts over the years. I'm 39 with $70k towards retirement. I can hardly save anything even though I'm frugal with everything. Realistically my retirement is at the bottom of a bottle of whiskey and fentanyl.
Assuming you are still an academic employed in one of our universities, your EBA gives you one of the most generous superannuation schemes in the country, typically with 15.4% SGC and ability to add half again on top, compared to 11% for us punters. UniSuper is a top performing default fund. She'll be right mate.
I left/ could find permanant role. In the private sector now. @@johnoneill1011
@@IrateMoogle37 with 10k here :/ I wouldn’t change my life choices for anything, but I’m hoping to pump more into super from here on out :)
When it comes to "Retirement", people always look to financial health and often neglects the fact that without physical or mental health, most of your retirement funds will be spent on care rather than on a chosen lifestyle. Having that magical figure, whatever it is, in your super/investments means nothing, if you are not in the right mind to enjoy it. Note, I said in the right mind as you don't have to be physically fit to enjoy your life, but it will be your mind that will decide whether you are having a good time of your life.
I've got enough retirement savings to see me through until the day I die. So long as I die next Tuesday. 🤣😜
Hahaha 🤪
If you’ve got super of $1.3 million how do you get a Centrelink pension?
Spend it
What you said about getting the pensions getting $100k from super is misleading. The 100k is considered in the income test and therefore reduces the amount of pension. If you get $100k, you don’t get any pension or the benefits
Superannuation pension income is not actually considered income in the Income Test. A superannuation balance is deemed to earn a certain rate of return. The actual pension income you draw down is not assessed. The information in this video is accurate.
A good video but I'm suspicious of these figures. 5% return and 2.5% inflation is not very realistic. My research says 7% and 4%.
Your $100k is much more realistic.
It also depends what sort of assets you have, but that's another discussion.
Positively geared property can return more than 10%, especially over the long term.
A 20% investment and a 20 year loan paid by rent can give you 10 times the original investment.
Obviously I'm going to need to work until I'm 105 to save that kind of money and that's if I don't spend a cent until then, I know a lot of retired people who are very comfortable on a lot less than that.
You're right. Most people don't need near that much for a happy retirement.
Great episode thank you❤ not achievable for many but also achievable for others
$1.5m in Australian shares . $2m in cash yielding 5%, assuming you can income split or its in pension phase. $3m in residential property at 3%
Congrats. Any tips or suggestions on growing wealth?
I want a room bed tv nothing more 300 rent a week just like a resthome but way cheaper. Spend private pension on holidays cruises
Are you assuming we get a govt pension
Yes, as assets decline below the threshold.
Is that $100k escalating each year to match inflation via the investment returns assumed? Tables would not be useful if the $100k was a fixed (ie not inflation linked). Please comment.
Yes, it escalates each year
The Australian pension is so low compared to other countries
I'd be interested to see data on this if you have it?
Hi where can i find a retirement calculator like the one you used.
the government has some useful calculators. Www.moneysmart.gov.au
You can make one yourself, with a spreadsheet.
Just to simplify it , in order to earn $100,000 a year (assuming you had no other income) you would need a 2M investment earning 5% a year in dividends or interest after taxes. . Take whatever retirement income you are earning and deduct it from the 100k to figure out what you need. For example, If you are earning 50,000 a year from social security, then you would simply need 1M from an investment account earning 5% after taxes.
Who gets $50k a year from social security?
I do. But that was just an example in round numbers.
One international travel once every 7 years? Did I hear this wrong? I thought should be 3 trips in one year. Otherwise why shall one retire after all?
yeah very 1970s
Inflation rate needs to be 10x
Super is a great investment. But it relies on people doing the hard yards early...... and of course that isn't always possible.
Returns are good over the long term, earnings are taxed at lower rates and salary sacrifing gives immediate savings because of tax benefits. Over 60 then no tax.
And you don't need $100k for 40 years---- you'll be a 100yo!!! What are you going to do with it then??
Would be interesting to see the figures based on $100k p.a till say 70yo then slide down to $50k pa till 80 then $50k till 90.
More videos to come!
I think I will need more money for health care when I’m older - I worry that my expenses will rise, not fall with age.
Why don't you do a video showing people how to find/use tools and calculators to work this stuff out for themselves- and then maybe a video on but-wiping 😀@@SuperGuyAu
Exactly. I’m 58, retiring in 3 years which will see me with 1.3m in super and savings. I’m planning on having my money last until I’m 72/73, then I’ll be almost mid 70’s and by that stage, I’ll be a couch potato.
Get yourself a 'how long will my super last calculator', but keep in mind that the returns are never consistent, so they can be very misleading. Google ' how long will my super last'.
Is a subjective question how much currency you need per year to live comfortably.
I don't believe that after 70 years of age you need anywhere near this amount of dollars.
I look around at all the 70 + year old people I know and very few of them do overseas holiday trips, buy new cars every few years or live a lavish lifestyle.
From 60 to 70 years of age you may live it up while you still have the health to travel overseas,etc. I believe that practically after 70,expenditure shrinks a lot. I think as retirees can all stress far too much about what we believe we need in dollars & security. If you have your house paid off or sufficient passive income to pay it off, I think this is the major expense.
What irks me most about Australia is the super contribution caps. This is especially punitive to immigrants that need to build their super balance up at a higher age.
Y it is very low too. In the UK the cap is over $100K
Agree the Salary sacrifice (pre-tax) 24/25 is only $30K. It never used to have a cap, but they have reduced it over the last 15 Years. You can now put $120K (post-tax) in without paying extra tax.
great video, I imagine I would need more from 60-70 then amount needed would start decrease as I age. We would live like king and queens on $100K :)
There's a government report that shows spending plummets from 80 onwards..
More on health less on food, wine, travel l, clothes entertainment.
There’s research which shows after 70-75 our spending reduces by 40%. However as we age aged care cost becomes an issue
Different decades of life bring on different costs. But, you're right, you would expect someone in their 60s to spend much more than someone in their 80s - assuming reasonable health.
Don’t understand how you can get aged pension if you have 1.5M in super, this is not very clear
As your assets inevitably decline from drawing down on them, you eventually become eligible.
Lol, looks like I’ll be working until I drop dead.
OK, I had just started my adult working life when mandatory super was first introduced. I was always under the impression that at some point, the old aged pension would no longer be an option.
Is this true? Why is this always factored in? Surely the old aged pension for people my age or younger should be the last gasp option.
It may get phased out over time. But, for now it's in.
Im moving to Thailand where my dollar goes further 😊
Not a bad option!
But isn't one supposed to be living off the interest only ?
Not necessarily. It depends on your objectives.
You have to draw down 4% a year of the total.
100k USD is around 160k AUD. You saying that you need 100k usd per yr to retire in the USA? That is insane!
Yes 100K AUD is excessive in todays terms. $60K tax free is enough (as long as you own your own home). In 20 years yes your may need $100K.
How much would you need for a 'comfortable lifestyle' if you didn't own a house?
Good question. I guess it depends on your rent costs which could vary considerably.
2.5 % inflation - if only!
The objective of the Reserve Bank is to keep the inflation rate to between 2 and 3%. Some years it will be more and some less. Either way, whether realistic or not, what's important in the example is that we have used a real return of 2.5% p.a. (5% earnings minus 2.5% inflation). If you think a real return of 2.5% p.a. is achievable then the inflation figure can be arbitrary and irrelevant.
@@SuperGuyAu historically the inflation rate in Australia since 1951is 4.89% and well all know that's a lie. So using 2.5% in your examples is not going to be anywhere near accurate.
The ten years (March 2009 to March 2019) the overall inflation rate, measured by the CPI, has increased 23.4 per cent.
@@TheDarin01Goung that far back is not realistic as a person starting their career at 16 would be in their 90s and probably doest give a hoot about their balance other than not falling over when they go for a walk
@@TheDarin01 but don’t miss the main point. Just a basic balanced fund should be beating inflation by 2.5% after all taxes and costs…and that’s all the example is relying on
I think my retirement is horrible.
Single and couple numbers seem to be around the wrong way. Ok just watched the video and saw the explanation 😂…
Thanks for watching!
My mother gets a pension how much is it... 24'k and she gets by OK, I looked at my own basic expenses and it's below 30 k, 50 to 100 k especially the latter is far too much and unrealistic as I have never actually worked in a job that gets over 100 k PA if I can still get by on a salary of 60 a year and have money left what are all these people doing with their money?Millions of older people in Australia are on the pension and they also don't have any superannuation. When you get a pension you get a concession card for transport, a cut in your bills, rego is free. It's 2.50 a day to go amywher on a bus, ferry, bus or train and the pension is indexed to inflation.do these 60 to 100 k a year people have an expensive drug habit? The average person coming up to retirement has got about 200 k in superannuation, if they retire early the super on 50 k a year is only going to last about five years. Then it would be chewing into your savings until you could get a full pension with 300 k in the bank but you can get a part pension up to 600 k I think, where your rates and other things are discounted so your money will last slightly longer and the 200 k super plus the savings will last more than 20 years, at that point when you are 85 do you think you will be wanting to drive around everywhere and burn up your remaining dough? My advise is if you retire early like at 55 you might actually get bored of hanging around by yourself and actually return to work again which happens frequently.
plenty to do when retired that are frugal, cooking from scratch, gardening, gardening for elderly neighbours, walks around your town, coffee with friends in a park, travel outside of school holidays, I could go on :)
At 5% return I would looking at a different investment pathway.
I agree- good old VOO gets you at least 7% above inflation, and I reckon thats boring!! I'm into TQQQ, so nobody should listen to me though.
It is a conservative estimate and remember the returns from super are tax free.
Depends how long you live. Travel after 65 is pain in the but
Wouldn’t they sell their house and downsize to extend the period before the money runs out.
I’m not planning to. I want my children to have a place to stay whilst they save money for their own home without paying rent.
How in the f$%k can a couple get any pension payments if you have your own home ,1.3 mill in the bank and a 100 grand in assets???
why do you need a pension if you have $1.3 million?
Ask the idiot speaking he suggested it ....theres no way you would be eligible
This is so misleading! If you live below your means and save “dollar saved is dollar earned” you don’t need the 70% pre retirement earnings they throw out as the rule. You need to work hard while you’re young and not waste money on eating out, drinking too much/smoking going out for coffee etc. learn to cook, make coffee at home, find the best prices when you need durable goods/cars etc. use rebates and point rewards all you can to save. If you’re fortunate enough to have your house and car paid for at retirement you also have the equity of the house if you want to sell and downsize/relocate. I swear they throw out the high numbers so you keep putting money into the fund manager machine.
guess i will never retire
Not a bad thing if you enjoy work!
@@SuperGuyAu Not really, just dont have much in super.
Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
Damn, I’m 41 and could retire…. Except most of my net worth is tied up in my home and it’s to nice to sell and downsize. So I got keep working haha booooo
It's all about priorities!
How much super do you need to live off $80 or $90k per year?
Stay tuned!
If you have $1Mil in super and your fund is returning 8% or 9% you'll get $80 or $90k tax free. If you own your own home. You'll be living large with 80 or 90.
Yea right, inflation at 2.5% 😂 try this with %4 and all he’ll break lose.
Returns in a balanced pension account are currently running at about 9%
wow your math is BAD - ionflation is 15% not 2.5!
assumption is you own your home otherwise is FALSE
I’m not sure why
50k is no where near enough to live comfortably. That would be the worst life ever
If you owned your own home and no longer had any work related expenses, would $1k clear a week really be the worst life ever?
1k a week would do me just fine, billions of people in the world are just happy being alive 🤷
Are you retired OP? $50k pa is good but not extravagant.
Many of the population live off just above $50k a year and pay a mortgage, so $50k a year with no mortgage to pay seems ok . I guess it depends on what you consider to be comfortable?
After mortgage I spend 50k a year holiday a lot go to sports and entertainment
how can anyone retire on $100,000 a year. Even in the Philippines that is poverty wages. You need to recommend that these people work until they have at least $300,000 per year. Jeesh.
I disagree. I retired at 42 and I’m raising 3 kids alone. I spend less than $100k and we live a good life.
No overseas trips, but I don’t miss it at all.
What I do have is quality time. And freedom of my choice of attention.
Trading money for time is the best for me and my family.
I guess I’m not like most people.
How much do you need to retire on $100,000 a year? $100,000...
Clever!
@@SuperGuyAu sorry about that. I couldn't resist. Great Channel and great show.