It is still generally worth contributing to superannuation over $3 million, as the 30% tax on earnings above this threshold is often lower than personal marginal tax rates. While the 15% concessional tax rate no longer applies to the balance exceeding $3M, super remains a highly tax-efficient, tax-free withdrawal environment, though alternatives like family trusts may become more attractive for growth assets.
Around 1.4 per cent or 142,000 households have more than $3 million in superannuation. Our specific interest in this paper is individuals who have more than $3 million in superannuation. We found only 87,000 individuals with more than $3 million balances.
Yes, you can retire at 50 with $3 million, but how long your savings will last depends on your return rate. 3% return rate: With a 3% return rate, following the 4% rule and accounting for an estimated 22% tax rate, your savings would last until age 87.
Division 296 tax applies at the rate of 15% to the earnings attributed to the portion of your balance that is above $3 million.
A small contribution today can mean more for your future. Even one extra payment before 20 June could help reduce your tax and grow your super balance—without changing your regular income.
Retiring at 60 with $500,000 in super is possible but challenging, depending heavily on your spending, lifestyle, and if you qualify for the Australian Age Pension. You might cover modest expenses using strategies like drawing down around $20,000 annually (using the 4% rule as a guide) plus other income, but it requires careful budgeting, potentially part-time work, and reducing living costs. A financial advisor can help tailor a plan, as $500k alone usually supports a basic to moderate retirement, not a lavish one.
The bring-forward rule enables you to accelerate your super contributions by using up to three years' worth of non-concessional (after-tax) contributions caps in a single year. This means you could contribute up to three times the annual limit in one go, or spread your contribution out over two to three years.
In the organisation's super balance update, it found 2.5 per cent of the population have a super account of more than $1 million, as of June 2021. This represents 417,567 individuals, ASFA said, and is a 29 per cent increase from the 322,200 individuals who held over $1 million in June 2019.
Minimise valuation movements
Under the plan, super assets would be valued as of 30 June each year to determine their tax liabilities. Avoiding the tax means keeping your balance below $3 million on that date. Doing so could involve: Reducing holdings of volatile assets: to minimise the chances of sudden upward swings.
Research shows that less than 1% of households have $3 million or more in retirement savings. While this amount is uncommon, those who consistently invest, save diligently and manage their spending can build significant retirement assets over time.
Suze Orman famously suggests many people need $5 million to $10 million to retire comfortably, especially for early retirement, to cover longevity, inflation, and healthcare risks, calling smaller amounts like $1 million or $2 million "nothing" against catastrophes. She emphasizes having 3 to 5 years of living expenses in cash reserves, separate from investments, and stresses a high savings rate (around 15%) and delaying Social Security for maximum benefit. While her large figures target a very secure, risk-averse retirement, she also advises on saving significantly more than typical projections suggest.
Yes — a couple can retire on $700,000 in Australia, particularly if they own their home and are eligible for Age Pension support later in retirement. Retiring at 65 with this balance could mean an annual income closer to or above the ASFA 'comfortable' standard for couples.
With that being said, what is a wealthy retirement? Well, according to ASFA, a comfortable retirement for a couple is around $75,000 per year and $53,000 for a single person. Given this, I would consider achieving a retirement income of, say, 30% over these amounts to be a wealthy retirement.
A modest retirement, as defined by the Association of Superannuation Funds of Australia (ASFA), covers essentials like housing, utilities, food, and basic leisure. For a couple, this might cost around $47,000 annually, which means you'll need less than $3 million.
Families like the Waltons, Kochs, and Mars can avoid capital gains taxes forever by holding onto assets without selling, borrowing against their assets for income, and using the stepped-up basis loophole at inheritance. That loophole allows the increased value of assets to be passed to their heirs tax-free.
It meant retirees could easily calculate how much they needed to save for retirement - by simply dividing the amount of money they would like to spend each year by the withdrawal rate. So if they wanted $50k each year from their portfolio at a 4% withdrawal rate, they could divide $50k by 4%, equalling $1.25 million.
To qualify for 0% capital gains tax, you must have long-term capital gains (assets held over a year) and your taxable income (after deductions) must fall below specific IRS thresholds, which change annually but are roughly <$48,350 for single filers and <$96,700 for married filing jointly for the 2025 tax year, allowing for higher total income when combined with deductions like the standard deduction. The key is keeping your adjusted gross income (AGI) low enough so that after subtracting deductions, your taxable income remains within these limits.
What Net Worth Defines “Upper Class” in Your 30s in Australia? And How to Build It
You can retire on $1 million dollars at any age. This amount can provide you with an income of around $40,000 per year, increasing with inflation, indefinitely – without the need to draw down in the capital amount – meaning you will still have $1 million (in today's dollars) in capital at the end.
Empower Personal DashboardTM data shows 9.1% of people fall into the category of 401(k) millionaire as of September 30, 2025, having accumulated at least $1 million in retirement savings in employer-sponsored plans and individually controlled IRA savings and investment accounts.
Currently the transfer balance cap is $2 million. After you retire any amounts over the cap need to be transferred into an accumulation account or withdrawn taken out as a lump sum. Earnings on any excess amount in your retirement account are taxed at 15%.