If you’ve ever asked yourself “which retirement plan is best?” you’re not alone.
With so many options out there from superannuation funds to pension accounts and self-managed super knowing where to start can be confusing.
Your retirement plan determines how comfortable and financially secure your future will be. The best retirement plan helps you grow your savings now and provides steady income when you stop working.
In this guide, we’ll break down which retirement plan is best in Australia for different goals, incomes, and lifestyles.
Understanding What a Retirement Plan Means
A retirement plan is your long-term financial strategy for life after work. It includes:
- Your superannuation fund (where most Australians save for retirement).
- Investment strategies such as shares, property, or managed funds.
- Government benefits, including the Age Pension.
- Income streams like an account-based pension or annuity.
Essentially, a retirement plan is how you turn your hard-earned savings into reliable income to fund your lifestyle.
Why Choosing the Right Retirement Plan Matters
The retirement plan you choose affects:
✅ How fast your savings grow.
✅ How much tax you pay.
✅ How soon you can retire.
✅ How long your money lasts after you stop working.
Even small differences in fees or returns can mean tens of thousands of dollars more (or less) by the time you retire. That’s why figuring out which retirement plan is best for you is one of the smartest financial decisions you can make.
Which Retirement Plan Is Best for You in 2025?
There’s no single “best” retirement plan for everyone it depends on your age, super balance, income, and goals.
But here are the main options Australians use, with their pros and cons:
1. Superannuation-Based Retirement Plan
For most Australians, superannuation is the foundation of retirement planning.
Your employer contributes 11.5% of your income (as of 2025) to your chosen fund, which is invested to grow over time.
When you retire (usually at age 60), your super becomes your main income source through:
- Lump sum withdrawals
- Account-based pensions
- Annuities
✅ Best for: Employees and self-employed Australians who want steady, tax-advantaged growth.
✅ Why it works: Super contributions and earnings are taxed at just 15%, much lower than most income tax rates.
2. Industry Super Funds
Industry super funds are not-for-profit, meaning profits go back to members instead of shareholders.
They’re known for low fees, strong long-term performance, and simple investment choices.
Top-rated industry funds in 2025 include AustralianSuper, Hostplus, HESTA, and Aware Super.
✅ Best for: Everyday Australians seeking low-cost, consistent growth.
✅ Why it works: Transparent structure, fewer hidden fees, and historically solid performance.
3. Retail Super Funds
Retail funds are run by banks or investment companies. They often offer more investment choices and access to personal financial advice, but fees can be higher.
✅ Best for: People wanting custom investment portfolios and direct access to advice.
✅ Why it works: Greater flexibility and options for diversification ideal for investors with larger balances.
4. Self-Managed Super Funds (SMSFs)
An SMSF lets you control your own super investments from property to shares and term deposits.
However, it requires time, knowledge, and compliance with ATO rules.
✅ Best for: Experienced investors with $200k+ balances who want full control.
✅ Why it works: You make all investment decisions, giving flexibility to tailor your portfolio.
5. Annuities and Pensions
Once you retire, converting your super into an account-based pension or lifetime annuity can provide stable, tax-free income.
✅ Best for: Retirees who want predictable, regular income.
✅ Why it works: Reduces risk of outliving your savings and provides peace of mind.
Factors to Consider When Choosing Which Retirement Plan Is Best
When comparing retirement plans, ask yourself:
- What are the fees and are they eating into returns?
- How has the plan performed over the last 5–10 years?
- Does it offer the investment options that suit my goals?
- Does it include insurance and how much does it cost?
- Can I easily access financial advice and online tools?
A good plan should strike the right balance between growth, stability, and flexibility.
Which Retirement Plan Is Best for Retirees in Australia?
For Australians nearing or in retirement, the best plans usually combine:
- A strong superannuation base (industry or retail fund).
- A reliable income stream, such as an account-based pension.
- Smart tax planning, so income is tax-free after age 60.
For example, if you have $700,000 in super at age 60, you might:
- Keep $500,000 in an account-based pension for monthly income.
- Withdraw $200,000 tax-free for personal goals like travel or debt repayment.
FAQs
1. Which retirement plan is best for low fees?
Industry super funds like AustralianSuper and Hostplus consistently rank among the best low-fee options with strong long-term performance.
2. Which retirement plan is best for high returns?
Funds offering growth investment options tend to deliver higher returns over time, but come with more risk. Balanced options are ideal for steady, long-term growth.
3. Which retirement plan is best for self-employed Australians?
You can contribute to any industry or retail fund or consider setting up an SMSF for full control, if your balance and time allow.
4. Which retirement plan is best for retirees?
A mix of account-based pensions and annuities works best for predictable, tax-free income in retirement.
5. Which retirement plan is best overall?
There’s no single “best” plan but the most effective plans combine low fees, consistent performance, and personalised investment choices.
If you’ve already explored How Many Australians Retire With Less Than They Need? the next question is when to retire.
Which Retirement Plan Is Best for You?
Ultimately, which retirement plan is best depends on your goals, risk tolerance, and stage of life.
For most Australians, industry super funds offer the best combination of low fees, strong returns, and simplicity.
If you prefer flexibility and personal control, retail funds or SMSFs can also be strong options.
The key is to start early, review your plan regularly, and seek professional advice to make sure your retirement strategy evolves with you.
At Wealthlab, we help Australians compare super funds, optimise contributions, and design personalised retirement strategies that deliver confidence and security.
👉 Book a consultation today to find out which retirement plan is best for your future.
Learn More About superannuation
https://www.servicesaustralia.gov.au/age-pension?
https://treasury.gov.au/policy-topics/superannuation
https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super