Retire at 60 with $230K Many Australians reach age 60 with savings or super balances that fall short of what financial experts call “ideal.” If you’ve saved $230,000 and are wondering whether you can retire at 60, the answer is: yes, it’s possible but it will require a modest lifestyle, disciplined planning, and strategic use of government support when it becomes available.
In this blog, we’ll help you understand how far $230k can stretch, what kind of retirement lifestyle it might support, and how to manage the crucial gap between age 60 and 67 when the Age Pension begins.
What Happens Financially at 60 in Australia?
Turning 60 marks a key milestone:
- You’ve reached your preservation age, which means you can access your super tax-free (if retired).
- You are still seven years away from the Age Pension, which begins at 67.
- You can set up a tax-effective income stream from your superannuation.
But retiring at 60 means fully funding your own lifestyle including healthcare, housing, and daily expenses for at least seven years before any government support kicks in.
What Retirement Costs Look Like
According to the ASFA Retirement Standard (March 2024):
- A modest lifestyle for a single person costs approximately $32,000 per year
- A comfortable lifestyle requires around $51,000 per year
These benchmarks assume you own your home and live independently using public health services.
With $230,000, you could fund 7–8 years of modest retirement living enough to get you through the critical 60–67 period if managed carefully.
Strategies to Make $230K Last Longer
- Delay retirement by 1–2 years and keep contributing to super
- Reduce spending temporarily before 67 to stretch savings
- Combine part-time work or rental income with your super
- Start planning now for Age Pension eligibility
How Long Will $230k Last in Retirement?
Here’s a projection assuming:
- Annual drawdown: ~$28,000
- Annual investment return: 3%
| Age | Starting Balance | Withdrawal | Growth (3%) | Ending Balance |
|---|---|---|---|---|
| 60 | $230,000 | $28,000 | $6,000 | $208,000 |
| 61 | $208,000 | $28,500 | $5,500 | $185,000 |
| 62 | $185,000 | $29,000 | $4,900 | $160,900 |
| 63 | $160,900 | $29,500 | $4,300 | $135,700 |
| 64 | $135,700 | $30,000 | $3,600 | $109,300 |
| 65 | $109,300 | $30,500 | $2,700 | $81,500 |
| 66 | $81,500 | $31,000 | $2,000 | $52,500 |
| 67 | $52,500 | $10,000 | $1,600 | $44,100 |
This shows that with careful budgeting, $230k can cover your early retirement years, and still leave you with a modest buffer once the Age Pension begins.
What Happens at Age 67?
You become eligible for the Age Pension, subject to income and assets tests. The good news? A super balance that’s been gradually drawn down may help you qualify.
Current Full Pension Rates (July 2024):
- Single: ~$29,000/year
- Couple combined: ~$43,800/year
Once you begin receiving the Age Pension, you may only need to draw down small amounts from your remaining super helping it last well into your 80s or even 90s.
How to Make Retirement Work on $230,000
1. Pay Off Your Home First
Eliminating rent or mortgage payments before retirement is one of the most effective ways to reduce your annual expenses. Housing is often the largest ongoing cost, and owning your home outright provides stability. With no repayments, your budget can stretch significantly further. It also reduces your reliance on super during the early retirement years.
2. Draw a Super Income Stream
Converting your super into an account-based pension allows for regular, flexible income while keeping withdrawals tax-free from age 60. This strategy helps you avoid large lump sum withdrawals that deplete your balance too soon. It also gradually reduces your assessable assets, improving your future eligibility for the Age Pension. You stay in control and in better shape long-term.
3. Budget Below the Modest Lifestyle Standard
The ASFA modest lifestyle assumes $32,000 per year, but careful planning can reduce that to $28,000 or less. Cutting non-essentials, using discounts, and sticking to a clear plan makes your savings last longer. It also allows you to create an emergency buffer for health or home costs. Living simply doesn’t mean sacrificing comfort it means spending wisely.
4. Keep Some Growth in Your Portfolio
Holding your entire balance in cash may feel safe, but it won’t keep up with inflation. Investing a portion in balanced or income-focused options offers moderate growth with controlled risk. Keeping 1–2 years of expenses in cash ensures liquidity while the rest of your funds can work harder. It’s a smart balance between security and sustainability.
5. Supplement with Casual or Freelance Work (if possible)
Even 5–10 hours of flexible work per week can make a major difference. It helps delay super withdrawals, keeps you socially engaged, and may even improve mental health. Working until 62 or 63 even part-time can preserve tens of thousands in your retirement fund. Plus, it may help you qualify for higher Age Pension payments down the line.
What Kind of Lifestyle Can You Expect on $230k?
| Category | Expectation |
|---|---|
| Housing | Must own your home |
| Food & Utilities | Covered if budgeted |
| Travel | Local trips, few/no overseas holidays |
| Healthcare | Public health system; limited private cover |
| Discretionary Spend | Low to moderate |
You can retire at 60 on $230k but you’ll need to stay within a disciplined, realistic lifestyle. The early years are the tightest, but things ease once Age Pension support begins.
Mistakes to Avoid on a $230k Retirement Plan
- Rushing to withdraw large lump sums from super
- Ignoring the 60–67 pension gap
- Overestimating investment returns
- Forgetting to factor in rising health and living costs
- Not getting professional financial advice
Retiring on $230k? Wealthlab Can Help You Make It Work
Whether you’re just starting your early retirement or planning ahead, Wealthlab’s expert planners help you make every dollar count. We specialise in helping Australians with modest balances retire confidently and securely.
✔️ Super drawdown strategies
✔️ Retirement income modelling
✔️ Age Pension optimisation
📞 Book a consultation now to map out your retirement from 60 onward.