Super in your 50s (and beyond)

Turning 50 is a milestone. It’s also an age where you begin to think about your super a bit more. 

Your 50s are an ideal time to start considering your retirement plans and how to get the most out of your super while you’re still working. It’s an exciting period, and we’re here to help you navigate it. 

Here are our top tips for what you can do with your super in your 50s. 

Get to know your super 

As you enter your 50s, retirement is fast approaching – or maybe you want to continue working. Whatever your situation, it helps to be prepared. 

With Australia’s life expectancy of 81.2 years for males and 85.3 years for females¹ , it’s estimated that many of us will spend more than a quarter of our lives in retirement. Understanding how you’ll fund this chapter of your life is important. 

For example, if you intend to retire at age 67 as a single, the Association of Superannuation Funds of Australia (ASFA) estimates you’ll need approximately $52,085 per year to fund a comfortable lifestyle². If you’re unsure how much super you’ll need to fund your retirement, check out MoneySmart’s retirement planner. 

Getting the most out of your super is crucial at any life stage, including your 50s. One of the simplest ways to ensure your hard-earned super is working for you is to consolidate your super. If you have multiple super accounts, you could be paying additional fees and missing out on valuable compound interest. 

Make contributions 

Generally, if you make voluntary contributions to your super, you’ll have a much more comfortable retirement than if you rely solely on the contributions your employer makes to your super. 

You can make up to $30,000^{^3} of concessional contributions to your account each financial year. Concessional contributions are taxed at 15% if you earn below $250,000 per year. They include: 

• Compulsory employer contributions. 

• Salary sacrifice payments. Your employer deducts an amount that you nominate from your salary before you pay tax and pays it to your super fund. 

• Personal deductible contributions. These are payments you can make to your super balance and can be claimed as an income tax deduction. Self-employed people and employees are both able to make these payments. 

You can also make up to $120,000^{^3}  of non-concessional contributions to your super. These contributions are from your after-tax income and represent a valuable way to boost your super balance. They include: 

• Contributions from your after-tax income that you make, or an employer makes on your behalf. As an added win, you could be eligible for a government co-contribution of up to $500 if you make a personal after-tax contribution. 

• Spouse contributions. These contributions can be made to increase your spouse’s super balance. If eligible, you may be able to claim a tax offset for this type of contribution. 

Importantly, if you’re 55 or over and if eligible, you may be able to use the proceeds from selling your home to make a downsizer contribution of up to $300,000. This is a non-concessional contribution but does not count towards the contribution cap of $120,000. 

There is a limit on the total amount of super that can be transferred into the retirement phase, this is referred to as the transfer balance cap and is $1.9 million⁴.

Review your investment strategy 

Ensuring you have an appropriate investment strategy for your age is crucial to getting the most out of your super as retirement approaches. 

If you’re planning to retire and withdraw funds within the next few years, you might consider adjusting your strategy to put greater emphasis on income generation and limiting your exposure to risk. Your investment strategy needs to suit your circumstances, and you may want to consider seeking professional financial advice. 

Have emergency savings 

When you get to your 50s and beyond, you may want to consider having some funds set aside in case you face unexpected costs. For many, approaching retirement age can also overlap with other life events that make having accessible savings a good idea. 

Health issues or employment instability can present significant challenges at this life stage. So, it makes sense to be financially prepared. 

Everyone’s circumstances are different. And while some may have insurance cover for health issues, an emergency fund can help to reduce the pressure on you or your family if something unexpected occurs. 

Plan ahead 

As many retirees will tell you, life post-work can be exciting and fulfilling. But it’s also important to be prepared. After all, you might have up to 30 years of retirement to fund. 

There are a number of ways to prepare for the retirement lifestyle you desire, including: 

• Reducing your working hours to part-time 

• Downsizing your home 

• Setting up a Transition to Retirement (TTR) strategy 

Once you reach preservation age, a TTR strategy lets you access some of your super while you keep working. Your funds are moved into a super pension, allowing you to withdraw between 4% and 10% of your pension account balance each financial year. 

Your 50s are a good time to think about what the rest of your career and retirement will look like. A financial adviser can help you understand what strategies are available and what may suit your individual circumstances. 

This information is current as at 1 October 2024 and may be subject to change. You should not rely on this article to determine your personal tax obligations or other entitlements. 

Bendigo Superannuation Pty Ltd (ABN 23 644 620 128 AFSL 534006) (Bendigo Super) is the trustee and issuer of Bendigo SmartStart Super and Bendigo SmartStart Pension (Products).
Before making an investment decision in relation to the Super Products, read the relevant Product Disclosure Statement, available from this website (www.betashares.com.au/super/) or by calling 1800 033 426, and consider whether the product is right for you. You can find the Bendigo SmartStart Super Target Market Determination here and the Bendigo SmartStart Pension Target Market Determination here. This information is general in nature and doesn’t take into account any person’s financial objectives, situation or needs. You should consider its appropriateness taking into account such factors and seek professional financial advice. Past performance is not indicative of future performance.

1. Source: Australian Bureau of Statistics (Life Tables, 2020-2022- external site)

2. Source: ASFA Retirement Standard June Quarter 2024, assuming retiree owns their own home

3. The income year 2024/25

4. From 1 July 2023, the transfer balance cap is indexed to $1.9 million.