How much will you need to enjoy your retirement?

This calculator allows you to estimate the annual income you might need to support a retirement lifestyle based on the expenses you input.

The default settings are set to a level estimated by ASFA* for what might be needed for a comfortable lifestyle in retirement. Under the ASFA Retirement Standard, a comfortable lifestyle enables a retiree, who owns their home outright and is relatively healthy, to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of things such as household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.

By moving the sliders under each expense category, you can see how changes to expenditure can affect the cost of your lifestyle in retirement.

*ASFA is the Association of Superannuation Funds of Australia Limited

Important information

The BT Retirement Lifestyle calculator is provided by BT Funds Management Limited ABN 63 002 916 458, AFSL No. 233724 (BTFM) and is current as at April 2019 but is subject to change.

The results depicted are illustrative only and are based on limited inputs provided and the assumptions built into the calculator. To the extent permitted by law, neither BTFM nor any other company in the Westpac Group of companies accept any liability for any omissions, errors or inaccuracies in the results generated by the calculator or use thereof.

The calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product or an interest in a financial product. The calculator is also not intended to be relied upon as a substitute for professional advice. You should consider seeking professional advice from an Australian financial services licensee before making any financial decisions. The results which you generate when using the calculator are dependent on the variables you input and the assumptions made by the calculator. As the variables and assumptions are an estimate only and are unlikely to match your situation precisely, the results may not be appropriate for your financial situation.

You should take into account your own personal objectives, financial situation and needs and consider the product disclosure statement (or other disclosure document) for any product you are considering.

Assumptions

The default expenditure for each expense category is based on what the ASFA Retirement Standard (Standard) estimates the average Australian individual or couple would spend each year (in today’s dollars) on each listed expense category to live a comfortable lifestyle in retirement. Under the Standard, a comfortable lifestyle enables a retiree to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of things such as household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.

The default amounts assume that the person is aged around 65, owns their home outright and is relatively healthy.

The ASFA Retirement Standard is issued by the Association of Superannuation Funds of Australia Limited (ASFA) and is updated quarterly. This calculator uses the data from the December 2018 quarter.

BTFM considers the assumptions reasonable because the ASFA Retirement Standard is based on research conducted by ASFA’s Research and Resource Centre, using data obtained from research and surveys conducted by the Australian Bureau of Statistics (ABS), the Australian Institute of Health and Welfare and research findings from the Social Policy Research Centre, University of NSW, Sydney.

The Standard provides an objective comprehensive picture of a retiree’s spending requirements, and is updated quarterly to reflect changes to the Consumer Price Index (CPI). The Standard is updated four times a year to take into consideration the rising price of items like food and utility bills, as well as changing lifestyle expectations and spending habits. The Standard includes the cost of things such as health, communication, clothing, travel and household goods.

In developing this calculator, BTFM has made assumptions when mapping the Standard’s expenditure items to categories shown on the calculator. This is outlined below: 

  • Household: Building and content insurance; rates; home improvements; repairs and maintenance; electricity and gas; bundle of home phone, broadband, mobile; household cleaning and other supplies; cosmetic and personal care items; barber or hairdressing; household appliances; pest control, alarm service
  • Groceries: Food (groceries and other fresh food)
  • Hobbies: Music and CDs; membership clubs; tv, dvd, digital camera
  • Entertainment: Newspaper and magazines; computer, printer and software; lunches and dinners out; cinema, plays, sport and day trips
  • Clothing: Clothing and footwear
  • Transport: Car transport and running costs; public transport
  • Medical care: Health insurance; chemist; co-payment and out-of-pocket
  • Holidays: Domestic vacations; overseas vacations 
  • Other expenses: Alcohol consumed in home (or equivalent spent); sundry items

Limitations

This calculator does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to these factors before acting on it.

The estimated annual income required is net of any tax that may apply and does not take into account inflation.

Your actual spend on each expense category may differ from the default amounts and, as a result, the annual income you require to fund your lifestyle will be different. You can modify the default amounts if they do not apply to you, or if you wish to see how changes to spending patterns can affect the income required to support a particular retirement lifestyle.

Whatever your vision of retirement is, making the most of your retirement years is certainly something worth planning for.
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