What Does a Comfortable Retirement Really Mean?

The numbers say one thing. Living it can be something quite different.

I read an SBS article recently telling me that Australians now believe they need more than $1 million in super to enjoy a comfortable retirement.

My first reaction was:

Really?

Then I read the article properly.

The figure that interested me wasn't really the $1 million. It was what the Association of Superannuation Funds of Australia (ASFA) actually means by a “comfortable retirement.”

And more importantly, I started wondering:

What does a comfortable retirement mean if you are still paying rent?

I am a renter.

I have been quite happy renting for many years, and I don't particularly want to go back to owning a home.

But there is a big difference between choosing to rent and having to make sure you can continue to afford the rent for the rest of your life.

A word about the figures

The figures I'm quoting here come from the Association of Superannuation Funds of Australia (ASFA) Retirement Standard. They are a benchmark or guide to what ASFA estimates Australians may need to spend for a modest or comfortable retirement. They are not a government requirement or a guarantee of what any individual needs to retire.

There is also an important distinction in the figures: ASFA's comfortable and modest retirement budgets assume the retiree owns their home outright. ASFA has a separate budget for people who rent privately, reflecting their higher housing costs.

The latest ASFA Retirement Standard says a homeowner couple aged 65 to 84 needs $78,998 a year — about $1,513 a week — for what it describes as a comfortable retirement.

That comfortable lifestyle includes things such as good private health insurance, regular leisure activities, eating out, a domestic holiday each year and an overseas trip every few years.

But ASFA's figures make an important assumption:

The comfortable figure is for homeowners.

And that distinction is important to me, because I am a renter.

For a couple renting privately, ASFA currently puts its modest-retirement budget at $69,376 a year.

And that is a modest retirement, not a comfortable one.

What does that mean in real life?

I can't help doing my own arithmetic.

Our rent has risen from $480 a week to $550 a week in three years.

That's now $28,600 a year just for the roof over our heads.

It doesn't include electricity.

It doesn't include food.

It doesn't include the car.

It doesn't include private health insurance.

And it certainly doesn't include a holiday.

So when I read that a comfortable retirement for a homeowner couple requires $78,998 a year, I find myself wondering what figure would be considered comfortable for a retired couple who are still paying market rent.

And then there is another problem.

Retirement doesn't come with a guaranteed cost-of-living increase on everything you buy.

The ABS recorded CPI inflation of 3.8 per cent in the 12 months to June 2026, while ASFA points out that several costs particularly relevant to retirees rose considerably faster. Electricity rose 22.4 per cent, vehicle maintenance and repairs 6.5 per cent, medical and hospital services 5 per cent, and insurance 4.9 per cent.

Those aren't luxuries.

Electricity isn't a luxury.

Keeping the car running isn't a luxury.

Healthcare certainly isn't a luxury.

And neither is having somewhere to live.

What does comfortable mean to me?

This is where I probably see retirement a little differently.

ASFA's comfortable retirement standard includes a range of things that many people would regard as enjoyable parts of life — private health insurance, a reasonable car, regular leisure activities, eating out, domestic holidays and occasional overseas travel.

There is nothing wrong with any of those things.

But I started wondering whether comfortable retirement has become too closely associated with how much you can afford to spend.

I do most of the cooking in our home. I was — and still consider myself — primarily a chef, so Karen and I eat very well.

We don't normally go out to restaurants.

Since COVID, we haven't been to the theatre or cinema.

Holidays have become a thing of the past.

And my car?

I bought my Mazda new in 2001, and it's still going strong.

Like me! 😂

We have an occasional wine and enjoy our life together.

And you know what?

I don't feel that we're missing out.

Perhaps I'm an unusual case.

Perhaps not.

But it does make me wonder whether retirement really can be reduced to a particular dollar figure.

Perhaps being comfortable isn't necessarily about how much you can spend.

Perhaps it is about being content with what you have.

The question of home ownership

I have already written about my thoughts on superannuation and how the system has changed during my working life.

What I hadn't really appreciated until retirement was how much the calculation depends on one enormous question:

Do you own your home?

If you do, once the mortgage is gone, housing can consume a much smaller part of your retirement income.

If you rent, the rent never disappears.

It keeps coming every week.

That is one of the things I think is missing when we talk about how much money someone “needs” to retire.

Two couples could have exactly the same income and very different lives.

One owns their home outright.

The other pays rent every week.

They may have exactly the same amount of money coming in, but they certainly don't have the same amount left to spend.

Retirement is a life, not a balance sheet

I'm not complaining about being retired.

Quite the opposite.

I've had a good life. I've travelled, raised a family, run businesses and made plenty of mistakes along the way.

I'm quite happy with the life Karen and I have now.

But when I see another figure telling Australians how much they need for a “comfortable retirement”, I think we need to ask another question.

Comfortable for whom?

Comfortable if you own your home?

Comfortable if you have private health insurance?

Comfortable if you have a substantial super balance?

Or comfortable if you're still paying $550 a week in rent?

Perhaps we should stop looking at retirement simply as a number in a superannuation account.

Retirement is a life, not a balance sheet.

Perhaps the real measure of a comfortable retirement is much simpler:

Can you pay for the life you have without constantly worrying about what next week's bill will bring?

A roof over our heads.

Food on the table.

A reliable old car.

Good health.

The ability to pay the bills.

A glass of wine.

Someone you love beside you.

And enough left over to sleep peacefully at night.

What does a comfortable retirement mean to you?