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Recent research by Westpac Bank and others have indicated that in retirement, the average couple will require an income of about $44,000 per annum after tax to lead a comfortable life style.

Under current tax and social security rules it is possible to generate this income for a couple tax free.

In order to generate this level of income a couple will need at least $300,000 invested and be entitled to substantial social security benefits.

The effect of inflation will mean that the above figures are in "today's dollars". The actual amount that will be required will be greater.

If inflation stays at around current levels then it is reasonable to expect to receive $6,000 in income for every $100,000 invested. Based on this a capital sum of $735,000 will be required for a couple to be self funded retirees on a sustainable basis ($16,666 of capital will be required to produce $10,000 of income).

Current AgeYears to RetirementCapital required to produce $10,000 income in future dollarsMonthly savings required to save this amountCapital sum needed for a 'comfortable life stlye' ($44,000pa)Monthly savings required to save this amount

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Diamond Financial Solutions
Charter Financial Planning Limited ABN 35 002 976 294
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Principal Address: 750 Collins Street PO Box 2830 Melbourne Victoria 3001
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