How Australian superannuation projects out
Super is a tax-advantaged retirement account with three growth levers: employer Super Guarantee (12% in FY25-26), your own contributions, and compounded investment returns inside a 15% tax wrapper. Get all three right and a typical 30-year-old retires with seven figures.
The Super Guarantee schedule
Employer SG is 12% of ordinary time earnings for FY 2025-26 — the final increase in the legislated phase-up. On an $85k salary that's $10,200 a year, paid into your fund at least quarterly. Contributions are taxed at 15% on entry; returns inside super are taxed at up to 15%, both well below typical marginal rates.
Why projections look enormous
A 30-year-old on $85k with $50k in super, 7% nominal returns and standard SG projects to roughly $1.1m at 65 in nominal dollars. In today's purchasing power (after 2.5% inflation) that's closer to $470k — still meaningful, but adjust your expectations to the "real" line, not the nominal one.
The three numbers that matter most
- Fees. 0.5% difference in fees over 35 years costs roughly 15% of your final balance. Check your fund on APRA's MySuper heatmap.
- Investment option. "Balanced" defaults around 70/30 growth/defensive; "High growth" 85+/15. Younger members usually want more growth.
- Consolidation. One account beats four. Multiple accounts mean duplicate fees and insurance premiums.
Preservation age and access
For anyone born after 1 July 1964, preservation age is 60. You can access super tax-free once you retire after 60, or via a transition-to-retirement (TTR) income stream from preservation age while still working. Plan around 60–67 as your earliest realistic access window.