Most don’t have enough super

MOST superannuation savers are heading for an impoverished retirement unless they can dramatically increase their contributions.

Even without the ravaging effects of the financial crisis, anyone who is relying on the basic 9 per cent super guarantee for their retirement savings is unlikely to accumulate enough money for a comfortable retirement.

A retirement shortfall of about $450 billion – or $80,000 per person – has been estimated nationwide.

As a result, industry groups are calling on contributions to be raised to a minimum of 12 per cent to prevent a retirement crisis.

Either way, unless you actively choose to salary sacrifice more into your super, you are heading for trouble.

So how much do you need for a comfortable retirement, and how much do you need to save to get there?

At the moment we have around $50,000 combined in our retirement accounts so will need to look into contributing additional funds.

We have chosen to concentrate on reducing debt and building savings but now that we are not incurring any interest on our mortgage and have built up substantial cash reserves, we can start to add funds to our retirement.

At the moment we are trying to figure out how to diversify our retirement accounts, both are in conservative funds due to the economy. Now that the economy appears to be turning the corner, we need to evaluate whether to move them into a higher risk fund. We are both still quite wary of the economy though, something the head of the Australian Treasury has just discussed with the media.