SMSFs on way to aspirational retirement

SMSFs aspirational retirement

Many SMSFs are on track to being able to afford an aspirational $100,000-a-year lifestyle in retirement, placing them well above ASFA retirement standards.

A large proportion of SMSFs are on their way to having enough savings to achieve their goal of an aspirational lifestyle in retirement, according to new data from an actuarial service provider.

Accurium’s “SMSF Retirement Insights Infographic”, released today, revealed 40 per cent of SMSF couples and 46 per cent of SMSF singles are on track to being able to afford a $100,000-a-year lifestyle in retirement.

In addition, it showed 75 per cent of 65 year olds can be confident of achieving the Association of Superannuation Funds of Australia’s (ASFA) comfortable standard of retirement of $61,522 a year for couples and $43,601 a year for singles.

Based on data drawn from around 65,000 SMSFs with balances in the retirement phase, the infographic also revealed the median combined balance for 65-year-old SMSF couples was $1.49 million as at 30 June 2018, while the median balance for an SMSF single was $1.31 million.

Accurium general manager Doug McBirnie said these balances indicated most SMSFs could be confident of being able to afford a comfortable standard of living in retirement.

“Based on Accurium’s data, a typical 65-year-old SMSF couple can be confident of achieving a $82,400-per-annum lifestyle and a single achieving $65,300 per annum. These figures are well above the comfortable standards quoted by ASFA,” McBirnie noted.

“However, our previous research has shown that many SMSF trustees are hoping to achieve more affluent lifestyles in retirement, with around a quarter of couples planning on spending over $100,000 per annum in retirement.

“Based on this aspiration, we estimate couples will need around $2 million in savings at the point of retirement. The good news is that 40 per cent of 65-year-old SMSF couples and 46 per cent of singles have saved enough to be confident of achieving an aspirational lifestyle.

“This demonstrates that people who take control of their superannuation with an SMSF are well placed to enjoy a higher standard of living in retirement.”

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