How Long Will My Super Last in Retirement? An Australian Guide
It's the central question of retirement planning — and the honest answer is: it depends on far more than your balance alone. This guide walks through every variable that matters, and shows you how to model them properly.
Updated May 2026 · 8 min read
The five variables that determine the answer
How long your super lasts is determined by five things, roughly in order of impact:
Your spending
The single biggest lever. Spending $70,000 per year draws down a $700,000 portfolio roughly twice as fast as spending $35,000. Every dollar of spending that can be funded by other income (pension, Age Pension, part-time work) directly extends how long your super lasts.
Your starting balance
Larger balances generate more investment income, which compounds over time. But balance alone doesn't tell the story — a $1 million portfolio supporting $80,000 spending is under more pressure than a $600,000 portfolio supporting $40,000 spending.
Investment returns
Higher returns extend the portfolio's life, but the timing of returns matters as much as the average. Poor returns early in retirement — when the portfolio is large and withdrawals are ongoing — can permanently impair the outcome even if average returns recover. This is sequencing risk.
Inflation
If your spending grows with inflation at 3% per year, your real spending power is maintained — but you need more dollars each year. A portfolio that looks comfortable in nominal terms may be tighter in real purchasing power over a 25-year retirement.
Other income (Age Pension, pension, part-time work)
Every dollar of income outside super is a dollar you don't need to withdraw. The Australian Age Pension is the most important factor many people overlook — it fundamentally changes how long super needs to last.
A simple starting point: the withdrawal rate
A useful rule of thumb is the withdrawal rate — your annual spending as a percentage of your portfolio. Research from the US (the "4% rule") suggested that a 4% initial withdrawal rate, adjusted for inflation each year, should sustain a portfolio for 30 years across most historical scenarios.
For an Australian context, this translates roughly as:
| Starting balance | 4% withdrawal | 5% withdrawal |
|---|---|---|
| $500,000 | $20,000/yr | $25,000/yr |
| $700,000 | $28,000/yr | $35,000/yr |
| $1,000,000 | $40,000/yr | $50,000/yr |
| $1,500,000 | $60,000/yr | $75,000/yr |
These are the amounts you could withdraw from the portfolio alone. In practice, most Australian retirees also receive Age Pension income — which dramatically reduces how much needs to come from super.
The Age Pension changes everything
Most retirement planning guides from the US or UK focus purely on portfolio withdrawal rates. In Australia, the Age Pension creates a fundamentally different dynamic.
The maximum Age Pension is around $31,223 per year for a single and $47,070 for a couple combined (March 2026 rates, indexed twice yearly in March and September). This income:
- Reduces the amount you need to withdraw from super
- Automatically increases as your super depletes (assets and income tests ease)
- Is guaranteed for life — eliminating longevity risk for the base level of spending
A couple with $800,000 in super spending $60,000 per year might initially receive a partial Age Pension of $15,000 — meaning they only need $45,000 from super. As super depletes, Age Pension entitlements grow toward the maximum, eventually covering most or all of a modest retirement income. The portfolio can last 5–15 years longer than a simple withdrawal model suggests.
Key insight: For many Australians, the real question isn't "will my super run out?" but "what spending level can I sustain across my retirement, combining super drawdown and a rising Age Pension?" These are very different questions with different answers.
Why sequencing risk matters more than average returns
Imagine two retirees, each with $600,000 and spending $40,000 per year. Both experience the same average annual return of 7% over 20 years. The difference: Retiree A gets poor returns in years 1–3, Retiree B gets those same poor returns in years 17–19.
Retiree A's portfolio is depleted well before 20 years. Retiree B's portfolio survives comfortably. Same average return, completely different outcome — because the timing of losses matters enormously when you're selling assets to fund spending.
This is why a single "constant return" projection — assuming 7% every year — significantly overstates the reliability of a retirement plan. A 2008-style market event in year 2 of retirement looks completely different from the same event in year 18.
Monte Carlo simulation: stress-testing across 500 scenarios
Rather than asking "what happens with 7% returns every year?", Monte Carlo simulation generates hundreds or thousands of different return sequences — some good, some terrible, most in between. It then reports what fraction of scenarios leave you financially secure at the target age.
A result of "85% success rate at age 90" means 85 out of 100 historically plausible market scenarios left the portfolio intact at 90. The 15% that failed aren't necessarily catastrophic — many would be rescued by a rising Age Pension entitlement as super depletes.
Monte Carlo results are more useful than constant-return projections because they show uncertainty, not just a single assumed path. Two retirement plans might both show comfortable outcomes at 7% constant returns, but one might have an 80% Monte Carlo success rate and the other 95% — a significant difference in real-world risk.
Find your sustainable spending level
RetireConfident's Retirement Calculator models Age Pension means testing, Monte Carlo simulation, sequencing risk, and defined benefit pensions — all in one free tool.
Use "Find Sustainable Spending" to let the calculator tell you the maximum spending level that keeps your portfolio intact across 80–85% of simulated scenarios.
Practical examples
The modest retirement
$400,000 super, age 67, spending $45,000/year couple
With full Age Pension entitlement (~$47,070/yr couple at age 67), only around $2,930/yr needs to come from super — effectively an infinite runway. The portfolio could grow over time rather than deplete. This scenario is more common than many people expect.
The comfortable retirement
$900,000 super, age 65, spending $80,000/year couple
At 65, Assets Test probably gives partial Age Pension (~$10,000/yr). Super needs to fund ~$70,000/yr. At constant 7% returns this lasts ~25 years. Monte Carlo at 85% confidence: probably closer to 20-22 years, but rising Age Pension entitlements as super depletes fill most of the gap. The plan works, but leaves little margin.
The early retiree
$1.2M super, age 55, spending $90,000/year
No Age Pension until 67. 12 years of full drawdown ($90,000/yr) before any government support. At 7% constant returns the portfolio survives, but the sequencing risk in those early years is high — a market correction in years 1-3 dramatically changes outcomes. This scenario most benefits from Monte Carlo stress-testing and a sequencing buffer strategy.
Frequently asked questions
How long does $500,000 in super last in retirement?+
With $500,000 in super and spending of $50,000 per year, and a 7% average return (before fees and inflation), the portfolio lasts roughly 15–18 years in a constant-return model. But this ignores the Age Pension, which typically cuts in from age 67 and can extend the portfolio's life dramatically — often by 10 or more years. The best approach is to model your specific situation including pension entitlements using a retirement calculator.
What is the 4% rule and does it work in Australia?+
The 4% rule (from the 1994 Bengen study) suggests withdrawing 4% of your portfolio per year should last 30 years. However, it was developed using US market data and may not fully apply in Australia. Australian retirees also have the Age Pension as a backstop, which significantly changes the optimal withdrawal strategy. Most Australian financial planners use more conservative starting withdrawal rates of 3–5% depending on the portfolio size and income needs.
What is sequencing risk and why does it matter?+
Sequencing risk is the danger that poor investment returns early in retirement permanently damage your portfolio, even if long-run average returns are fine. A 30% loss in year 2 of retirement forces you to sell assets at depressed prices to fund spending — leaving less capital to benefit from the eventual recovery. This is why the order of returns matters enormously in retirement, even if the average return is the same.
How much super do I need to retire in Australia?+
ASFA estimates (February 2026) a comfortable retirement requires about $630,000 for a single and $730,000 for a couple, assuming home ownership and partial Age Pension entitlement. However, these figures assume you retire at 67 and receive some Age Pension. If you retire earlier, have higher spending goals, or want to leave an estate, you'll need significantly more. The best approach is to model your specific spending, income, and retirement age using a retirement calculator.
Does the Age Pension run out?+
No. The Australian Age Pension is a government-funded payment that continues for life, regardless of how long you live or how your investments perform. As your super depletes over time, your Age Pension entitlement typically increases (because your assessable assets and income fall). This built-in safety net is unique to Australia and significantly extends how long most retirees' savings last.