Want to retire with $255K in Australia at 60? You’re not alone in wondering if it can be done. Many Australians reach retirement with less than they’d planned, but that doesn’t mean it’s impossible. With a modest lifestyle, smart budgeting, and a plan to bridge the seven years before the Age Pension kicks in at 67, you can make it work. This guide shows how to stretch your $255,000, what kind of lifestyle it can support, and ways to boost your long-term retirement security.
Retiring at 60: What Changes?
Age 60 is when:
- ✅ You reach your preservation age and can access super tax-free (if retired)
- ✅ You’re still ineligible for the Age Pension (available at 67)
- ✅ You can start an account-based pension for structured drawdowns
That means you’ll need to fully self-fund your life for seven years, with the goal of arriving at 67 with enough left to combine with the Age Pension.
How Much Do You Need?
According to the ASFA Retirement Standard (March 2024):
- Modest lifestyle (single): ~$32,000/year
- Comfortable lifestyle (single): ~$51,000/year
If you own your home and manage costs wisely, $255,000 could support modest living until the Age Pension begins and then continue to supplement it.
How Long Will $255,000 Last?
Assumptions:
- Annual spending: ~$29,000
- Investment return: ~3%
| Age | Starting Balance | Withdrawal | Growth (3%) | Ending Balance |
|---|---|---|---|---|
| 60 | $255,000 | $29,000 | $6,200 | $232,200 |
| 61 | $232,200 | $29,500 | $5,800 | $208,500 |
| 62 | $208,500 | $30,000 | $5,200 | $183,700 |
| 63 | $183,700 | $30,500 | $4,400 | $157,600 |
| 64 | $157,600 | $31,000 | $3,500 | $130,100 |
| 65 | $130,100 | $31,500 | $2,800 | $101,400 |
| 66 | $101,400 | $32,000 | $2,200 | $71,600 |
| 67 | $71,600 | $10,000 | $2,100 | $63,700 |
👉 This projection shows that $255k can reasonably fund the 60–67 period and still leave a buffer for later retirement years when the Age Pension kicks in.
This line chart showing depletion from age 60 to 90 under the three spending levels provides clarity. If you withdraw:
- $20K/year, your super could last beyond age 80.
- $25K/year, your super may run out around age 78.
- $30K/year, you may run out of funds before age 75.
What Happens at 67?
Once you turn 67, you may qualify for the Age Pension, depending on your assets and income.
July 2024 Pension Rates:
- Single: ~$29,000/year
- Couple (combined): ~$43,800/year
Since your super balance will have decreased, you’re likely to qualify for full or partial Age Pension especially if you’ve kept drawdowns modest.
How to Make Retirement Work on $255,000
Yes. From age 67, you may become eligible for the Age Pension (if you meet income and asset tests). This can extend the life of your super dramatically by reducing how much you need to withdraw each year.
1. Own Your Home
Owning your home outright slashes your biggest cost in retirement. With no rent or mortgage, your annual expenses become far more manageable — especially on a modest budget. Prioritising debt-free home ownership before retiring gives you a critical head start.
2. Convert Super to an Account-Based Pension
Setting up an account-based pension gives you control, tax efficiency, and predictable income. It avoids the risks of lump sum withdrawals and helps preserve your balance. You choose the payment frequency and investment mix to suit your lifestyle and goals.
3. Live Slightly Below the Modest Standard
If you can live on $26,000–$28,000/year, you’ll stretch your funds further and give yourself a buffer. This means cutting down on discretionary spending, leveraging public services, and using government concessions where possible. A few thousand saved each year can extend retirement comfort.
4. Mix Growth and Security in Your Portfolio
Don’t go 100% defensive. Keep part of your super in conservative growth funds enough to offset inflation without big risk. At the same time, hold 1–2 years of living expenses in cash or low-volatility assets. This mix helps ensure long-term sustainability.
5. Supplement with Flexible Work
Even a small side income from consulting, freelancing, or part-time work can reduce pressure on your super. It’s especially useful from ages 60 to 63, helping preserve your savings for later. Plus, it keeps you mentally and socially active, improving quality of life.
What Kind of Lifestyle Can You Expect on $255k?
| Category | Expectation |
|---|---|
| Housing | Must own home |
| Living Expenses | Covered if budgeted wisely |
| Healthcare | Public system use; limited extras |
| Travel | Occasional domestic trips |
| Luxury Spending | Minimal; focus on essentials |
This kind of lifestyle allows for a simple, independent retirement especially in regional areas with lower costs of living.
Mistakes to Avoid on a $255k Retirement Plan
❌ Withdrawing large lump sums
❌ Failing to plan for inflation or unexpected costs
❌ Relying too soon on Age Pension
❌ Avoiding professional guidance
❌ Going too conservative or too aggressive with investments
Wealthlab Can Help You Retire on $255k With Confidence
Retiring on $255k is achievable, but it requires smart decisions. Our team at Wealthlab can help you create a tailored plan that gets the most from your super and maximises long-term stability.
✔️ Super drawdown advice
✔️ Income planning and modelling
✔️ Age Pension support and eligibility