The Retirement forecaster is an educational tool which provides illustrative calculations based on assumptions and your inputs. The results are estimates only, and not exact figures. The results are not guaranteed. It has been based on current laws and their interpretation as at July 2018.
The Retirement forecaster is only intended to be a general illustration of your superannuation requirements based on specific assumptions and limitations. The Retirement forecaster is a financial model and, as such, cannot predict with any certainty your end super balance or the effects of withdrawing from your superannuation savings. This will depend on a range of matters including (but not limited to) changes to your personal circumstances (eg unexpected life events, any age pension you receive) and unpredictable external factors beyond your control such as changes to tax law, social security law, investment earnings and inflation.
While the Retirement forecaster provides a useful starting point, the information that it provides is not a substitute for professional advice from a qualified financial advisor and should not be relied upon as the basis upon which to alter your financial arrangements. We recommend that you seek professional assistance prior to making any decisions regarding your financial position, to determine if they are appropriate to your financial needs, circumstances and objectives.
NULIS Nominees (Australia) Limited does not accept any liability, direct or indirectly, arising from any person relying, either wholly or partially, upon any information provided by, resulting from, shown in, or omitted from, the Retirement forecaster. To the maximum extent permitted by law, NULIS Nominees (Australia) Limited will not be liable (whether based in contract, tort, strict liability or otherwise) for any direct, indirect, incidental, consequential, or special loss or damage arising out of or in any way connected with by a user’s access to or use of this Retirement forecaster.
This Retirement forecaster is provided by NULIS Nominees (Australia) Limited (ABN 80 008 515 633) AFSL 236465, the Trustee of the MLC Super Fund (ABN 70 732 426 024)
This calculator is intended for illustrative purposes only. The information it contains is of a general nature only.
The results provided by the calculator are estimates only and are not guaranteed. Actual outcomes depend on uncertain factors such as salary increases, investment returns and relevant legislation. You should consider regularly updating the projections provided by the calculator.
The calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. In making any decisions about your superannuation or your retirement you should consider your own objectives, financial situation and needs. You should consider obtaining advice from a licensed financial adviser before making any decisions.
Wage inflation is assumed to be 3.2% pa, and price inflation is assumed to be 2.0% pa. These are the default rates in the ASIC MoneySmart superannuation calculator.
You can change the assumed price and wage inflation rates in the 'Edit assumptions' section.
Results are in today’s dollars
Results are shown in today's dollars. This means the amounts shown are adjusted for inflation (and so take into account the assumed change in the cost of living between the time of preparing the estimate and the future time).
The assumed rate of wage inflation has been used to discount future amounts to today’s dollars.
You are able to enter your current salary on the initial 'About you' screen. Your salary is then assumed to increase in line with wage inflation. In any future periods where you enter a period of part-time employment, your salary is reduced pro-rata.
Tax calculations allow for Personal Income Tax rates, the Medicare Levy, the Low Income Tax Offset and the Senior Australian Tax Offset. Threshold and Offset amounts in the first year are based on current rates. Thereafter they are assumed to increase in line with wage inflation.
The calculator assumes that your employer makes superannuation guarantee contributions on your behalf.
Superannuation guarantee contribution rates are:
|Financial year ||Rate |
Superannuation guarantee contributions are subject to the maximum contribution base, which is currently $54,030 per quarter (for the 2018/19 financial year). This threshold is assumed to increase in line with wage inflation.
Voluntary member contributions
The calculator enables you to enter regular voluntary concessional or non-concessional contributions. Voluntary contribution amounts are assumed to increase in each year in line with your salary. In any periods of part-time work, these contributions are assumed to decrease pro-rata.
The calculator also enables you to make a one off non-concessional contribution. The amount you enter as a one off contribution is assumed to be fixed, and is not indexed.
Concessional contributions up to $25,000 pa are taxed at 15%. Concessional contributions in excess of the contribution threshold are subject to additional tax. This is levied in the income tax environment, and so has no impact on the estimates in this calculator; however it would increase the amount of income tax you would have to pay.
High income earners (those who earn over $250,000 p.a.) are subject to additional tax on concessional contributions. These individuals will pay an additional 15% contributions tax on contributions relating to income above the $250,000 threshold. The calculator assumes that this additional tax is deducted from the superannuation balance; however there is also the option to pay this tax directly to the ATO.
Non-concessional contributions up to $100,000 pa are not taxed. You can increase this amount in any one year under the 'bring-forward' arrangements. The additional amount which can be contributed depends on your account balance and your age:
- if your balance is under $1.4m you are able to 'bring-forward' this and the next two years of contributions, and so can contribute $300,000.
- if your balance is between $1.4m and $1.5m you are able to 'bring-forward' this and the following year of contributions, and so can contribute $200,000.
- if your balance is between $1.5m and $1.6m (or if you are between 65 and 74 years old) you are not able to bring forward any future year’s contributions, your non-concessional contribution cap is equal to the annual cap of $100,000.
- if your balance is over $1.6m (or if you are 75 years old or older) your non-concessional contributions cap is $0.
The calculator enables you to enter both regular annual non-concessional contributions and a one off lump sum non-concessional contribution. If in any year the combination of these would exceed the relevant non-concessional contribution cap, the calculator will limit the contributions to the cap amount; if this occurs you will receive a message.
The Concessional and Non-Concessional contribution thresholds are indexed in line with the assumed rate of wage inflation.
In each projection year, your eligibility for a Government Co-Contribution is assessed based on your salary and non-concessional contributions.
The Co-Contribution thresholds and maximum amount are indexed in line with wage inflation.
In each projection year, your eligibility for a Low Income Superannuation Tax Offset is assessed based on your salary and concessional contributions.
The LISTO income threshold and maximum benefit are indexed in line with wage inflation.
The default investment return and fee assumptions are:
| ||Pension phase return (before tax) ||Accumulation phase return (after tax) ||Investment fee (%pa) |
These are the default rates in the ASIC MoneySmart superannuation calculator.
Investment earnings in Accumulation and Transition to Retirement pension accounts are taxed. Investment earnings in post-retirement pension accounts are tax-free. The above returns are before the asset-based investment fee.
Note: If you choose to include your spouse’s details in the Retirement forecaster, your spouse is assumed to be invested in the same investment option as the primary user.
Administration fees and insurance premiums
The default administration fees and insurance premiums are:
|Administration Fee (per annum)||$50 per annum|
|Asset-based Administration Fee||0.60% pa of the account balance|
|Insurance premiums||$100 per annum|
These are the 'Medium fee level' rates in the ASIC MoneySmart superannuation calculator.
The dollar-based administration fee and the annual insurance premium are assumed to increase in line wage inflation.
The calculator provides an indicator of your life expectancy. The life expectancies allow for future mortality improvements. They were derived based on the medium mortality rate assumptions in the Australian Bureau of Statistics in 'Population Projections 2006-2101'.
Note: If you choose to include your spouse’s details in the Retirement forecaster, the life expectancy will continue to be based on the primary user’s life expectancy.
The calculator estimates your age pension entitlement.
The full rate of age pension and associated supplements are initially set to the current rates; detailed on https://www.humanservices.gov.au/individuals/services/centrelink/age-pension. The full rate of payment is indexed each year in line with wage inflation.
Age pension eligibility is subject to an asset test and an income test. Asset and income test thresholds are initially set to their current levels, and are indexed each year in line with price inflation.
The asset test is based on the accrued balance of superannuation assets and other assets.
Centrelink assess income for income test purposes in a number of ways. For example, any actual rent received on investment properties is included in assessable income. However interest or dividend income received on financial investments is not included directly. Rather 'deemed' income is calculated on financial investments and used for the age pension income test.
For the purpose of this calculator, this distinction is not made. Rather, deemed income is calculated on superannuation and all assets outside of superannuation, and age pension eligibility is calculated based on this deemed income.
Transfer balance cap
The transfer balance cap restricts the amount that can be transferred into an account-based pension. At 1 July 2018 the cap is $1.6m and will increase in $100,000 increments in line with price inflation. If at the time of retirement your projected account balance exceeds the (indexed) transfer balance cap, the maximum possible amount will be transferred into an account-based pension and any excess balance will be retained in an accumulation account.
The drawings from superannuation in retirement are calculated as: Target income (which you are able to specify) less other income (which you are able to specify) less any age pension amounts (as calculated by the calculator).
Where the transfer balance cap is exceeded at the time of retirement, in retirement you will have both an accumulation account and a pension account. The minimum required amount will be drawn from the pension account and any further income required to attain your target income will be drawn from their accumulation account.
There are statutory minimum superannuation drawings in both the transition to retirement (TTR) phase and in retirement (once funds have been converted to the pension phase). For the purpose of this projection, this minimum is effectively ignored in the TTR phase, on the basis that any excess drawings could be re-contributed as non-concessional contributions.
A number of assumptions in this calculator are prescribed by legislation. These assumptions include: superannuation guarantee contribution rates; the tax arrangements on superannuation contributions, investment earnings and drawings; co-contributions; age pension payment rates and thresholds; and income tax rates.
Where there is relevant legislation, the assumptions made in this calculator reflect current legislative arrangements. One uncertainty regarding future superannuation entitlement relates to possible future legislative changes.
Although some future changes in the legislation relating to superannuation are likely, it is not possible to know what these changes may be. Where there is relevant legislation, current legislative arrangements therefore represent the most reasonable basis for estimating future superannuation entitlement.
Updates to legislative assumptions are made as soon as practicable after such changes are announced. The calculator is based on legislative arrangements as at August 2018.
This calculator attempts to include the most significant features of the superannuation environment, and to do so in an accurate manner. However a calculator such as this is not able to address all facets of superannuation. The most significant limitations are:
- The calculator performs a 'deterministic' projection.
This means that the assumptions such as investment returns are assumed to be constant every year, at the rates indicated above. The actual investment returns will vary from year to year. More aggressive investment options, with higher expected returns, would be expected to exhibit a more significant range of outcomes. The calculator does not show the range of possible outcomes.
In this calculator, selecting a more aggressive investment option will present a more favourable outcome. However there is also likely to be more uncertainty attached to this outcome. You should consider this carefully before selecting an investment option.
- The calculator does not include the capacity to make 'catch-up' concessional contributions.
- Deemed income on all other assets.
As described above, when assessing age pension eligibility, the calculator considers deemed income on all other assets.
If you have significant rental income from investment properties this may not be appropriate, and personal financial advice should be obtained.