This is not a straightforward question and it really depends on the type of lifestyle you want after you retire.  Most people’s lifestyles will be less costly in older age, because they usually no longer have to support children and have often paid off their mortgage.

The Australian Prudential Regulation Authority estimates that on average, most people need an income equivalent to about 60% of their annual salary. They also estimate that the average worker needs a total investment of about seven times their annual salary to achieve this. This requires a significant contribution over a period of decades if the contribution is in the range of 10% of salary. It is important to realise that the current rate for the age pension is about 25% of average weekly earnings (and you may have been earning more than the average when you were working).

Posted on 09/09/2020