You’ve built up $400,000 in super and you’re ready to leave the workforce at 60. The big question is can you make it last? The short answer: yes, but only with careful planning, disciplined spending, and a strategy that bridges the years before the Age Pension kicks in at 67.
While $400k won’t fund a lavish lifestyle, it can provide a modest and secure retirement if you own your home, live within your means, and keep part of your super invested for growth. The key is to stretch your funds while still enjoying the freedom and flexibility that retirement brings.
What Happens Financially at 60?
At 60, you’ve reached your preservation age, meaning you can access your super tax-free if you’ve retired. But you’ll face a seven-year gap before you can access the Age Pension, so your super will need to fully cover living costs during that time.
This gap is manageable if you:
- Own your home outright
- Stick to a modest budget
- Treat your super as a carefully drawn income stream rather than a lump sum to spend freely
A well-structured account-based pension can provide you with regular payments while keeping part of your super invested, helping your money last longer.
What Retirement Costs Look Like
The ASFA Retirement Standard (March 2024) estimates:
- Modest lifestyle (single): ~$32,000/year
- Comfortable lifestyle (single): ~$51,000/year
These estimates assume you own your home, use public healthcare, and live independently.
With $400k, aiming for $28,000–$32,000 per year will help stretch your super. This means living modestly but you can still enjoy a fulfilling retirement with some travel, hobbies, and leisure activities if you budget carefully.
What Happens at Age 67?
At 67, you may qualify for the Age Pension, depending on your assets and income. For singles, the full pension is around $29,000 per year, and for couples, about $43,800 (July 2024 rates).
If you’ve managed your super well during your 60–67 gap years, you can combine your remaining balance with the Age Pension to cover expenses comfortably into your 80s and beyond.
How to Make Retirement Work on $400k
Owning your home is the single biggest factor in keeping costs low. Without mortgage or rent, your super can stretch much further. Setting up an account-based pension helps you draw a regular, tax-free income while keeping your funds invested. Diversifying your investments balancing growth assets with defensive ones helps protect against inflation without taking unnecessary risks.
A modest budget is essential. Spending around $31,000 per year in your early 60s leaves more for later years when costs such as healthcare may rise. And if you’re open to it, part-time or casual work can add valuable extra income, giving your super more time to grow.
Retiring at 60 with $400k in Australia is possible if you own your home, budget wisely, and invest strategically. The goal is to enjoy your retirement years without the stress of running out of money and that’s where good planning makes all the difference.
Plan Your Retirement with Confidence
If you’re thinking about retiring at 60 with $400k, Wealthlab can help you create a personalised retirement roadmap. We’ll show you how to maximise your super, manage the gap to Age Pension age, and protect your financial future.
📅 Book your free consultation now at Wealthlab.com.au and take the first step towards a confident, stress-free retirement.