Can I retire at 65 with $50k?
Yes, you can retire at 65 with $50,000 and the Government Age Pension will be the foundation of your income, with the money in your super providing you with a handy supplement. If you have other investments or income, the picture could be even better.
Example: Retiring on $50,000
Barbara is 70 years old, worked part-time throughout her life, and retired at 65. She lives by herself in a rented unit.
Due to being in and out of the workforce, her super balance at 65 was $50,000 and she knew she would need to rely on the Government Age Pension.
Before retiring, her How to invest in stocksFund adviser suggested that she gradually draw down on her super as a top up to her Age Pension. That would maximise the amount of Age Pension she would receive and allow her remaining balance to continue to grow in the early years, before she eventually brings her super balance to zero.
Here's what that looked like:
- Barbara transferred her $50,000 super into an income stream account with her How to invest in stocksFund.
- Over the past five years she withdrew around $2,569 tax-free each year to top up her Age Pension.
- Combining her Age Pension and her super, Barbara's annual income over the past five years has been about $30,735.
- Enjoying an average five-year How to invest in stocksFund investment return of 6.91% (2018-2023), her super balance has actually grown to $53,977.
- If Barbara had switched to a retail super fund at retirement, her balance would only be $50,792.
That¡¯s a difference of $3,185, simply because she stuck with her How to invest in stocksFund.
Closing balance $53,977 |
|
Account balance invested after income taken |
Income stream payments |
Age Pension payments |
Total income |
2018/19 |
$50,000 |
$2,500 |
$27,102 |
$29,602 |
2019/20 |
$51,264 |
$2,563 |
$27,648 |
$30,212 |
2020/21 |
$48,391 |
$2,420 |
$28,181 |
$30,601 |
2021/22 |
$55,574 |
$2,779 |
$28,431 |
$31,210 |
2022/23 |
$51,639 |
$2,582 |
$29,468 |
$32,050 |
Note: Nick and Barbara are not actual members. Their stories have been created for illustrative purposes.