Could you retire earlier than planned?

While there is no magic retirement number, you will need a substantial nest egg for a comfortable life once your working income stops. Savings will depend on your lifestyle, housing, investments, health and the income you expect to receive from sources such as the Age Pension.

However, the ASFA Retirement Standard provides a useful benchmark.

For a comfortable retirement, ASFA currently estimates a homeowner couple needs around $78,566 a year, while a single homeowner needs approximately $55,923. It estimates retirement savings of around $730,000 for a couple and $630,000 for a single person, assuming retirement at 67, home ownership and access to a partial Age Pension.

These aren’t targets that apply to everyone. If you want regular overseas travel, plan to help your children financially or have significant health expenses, you may need considerably more.

More importantly, retiring at 59 instead of 67 changes the calculation. Your savings need to fund more years, while you lose years of employment income and super contributions.

Investment reforms introduced in 2026 mean superannuation remains one of the most important wealth-building tools available for Australians. Deciding to retire early shouldn’t automatically mean winding down your super strategy years beforehand.

Depending on your circumstances, continuing concessional or non-concessional contributions will greatly influence the capital available to fund retirement and take advantage of super’s tax environment. It can also create opportunities to structure retirement income more effectively.

The years immediately before retirement can be particularly valuable. Rather than coasting towards your nominated retirement date, they can be used deliberately to build your position.

A recent industry survey found that 62% of Australians did not know at what age they can access their superannuation. This reinforces the need for a professional and experienced financial adviser to help individuals and couples understand how to build for a retirement they deserve.

An integral part of financial literacy is your right to the Aged Pension. The Age Pension should be considered as part of an overall retirement income strategy, particularly because eligibility isn’t simply determined by whether you have “too much money”.

Centrelink applies an income test and an assets test, with the lower of the two tests determining what you receive. Your homeownership status and relationship status also affect the thresholds.

From 1 July 2026, for example, a homeowner couple can have combined assessable assets of $499,000 before the assets test begins reducing their pension, with part-pension eligibility potentially continuing until combined assessable assets exceed $1,102,500. For a single homeowner, those thresholds are $333,000 and $733,500, respectively. Understanding what Centrelink assesses, what it exempts and how income is deemed can make a meaningful difference.

The objective shouldn’t be to make financial decisions simply to qualify for more Age Pension. It is to structure your overall retirement resources intelligently. Sometimes, having more private wealth and receiving less pension leaves you better off.

For many Australians, their largest asset isn’t super. It’s their home. Downsizing can unlock hundreds of thousands of dollars previously tied up in property. It may also reduce maintenance and household expenses and allow you to choose a home better suited to later life.

Eligible Australians aged 55 and over may also be able to contribute up to $300,000 each from the proceeds of selling their home into super, meaning an eligible couple could potentially contribute up to $600,000.

But downsizing isn’t automatically a financial win. Stamp duty, selling and moving costs, strata fees, the price of the replacement property, and the emotional cost of leaving the family home all need to be considered. Importantly, your principal residence is generally excluded from the Age Pension assets test, whereas money released from it may become assessable.

Quality financial advice is essential in this instance. Understanding the pros and cons of selling the family home and downsizing is invaluable, and having an external set of eyes that understands the implications is a valuable resource.

Retirement planning shouldn’t only answer whether you can retire at 65 or 67. It should tell you what happens at 65, 62 or even 59. How much income could your investments sustainably provide? What happens to your super strategy? Could you clear your mortgage? Should you downsize? Might you qualify for a part Age Pension later? What happens if you live well into your 90s?

The earlier these scenarios are modelled, the more options you generally have. A proactive retirement plan isn’t simply about reaching a date with a certain super balance. It’s about putting yourself in a financial position where, if retirement arrives earlier than expected, you have choices.

The team at First Financial comprises financial experts who help hundreds of Australians retire well and make informed, intelligent financial decisions. We cover everything from retirement and financial advice, investment and wealth management, superannuation and SMSF, insurance, tax, aged care, legal and lending services.

Contact us for holistic, well-rounded financial management strategies.