What Is a Good Monthly Retirement Income in Australia?

How much money do you actually need each month to live well in retirement? It’s not just about covering bills-it’s about keeping your lifestyle, staying healthy, and still being able to visit family or take a trip without stressing over every dollar. For most Australians, the answer isn’t a single number. It depends on where you live, what you’ve saved, and how you plan to spend your time after work.

What most retirees actually spend

The Australian Bureau of Statistics found that in 2024, the average couple retired on about $48,000 a year-roughly $4,000 a month. But that’s just an average. Some spend far less. Others spend double. A single person living in a regional town might get by on $2,500 a month. Someone in Sydney or Melbourne who wants to keep dining out, travelling, and maintaining a home could easily need $7,000 or more.

Here’s a real breakdown from a couple in Wollongong who retired at 65:

• $800: Rent or mortgage (they paid off their home before retiring)
• $400: Utilities (electricity, gas, internet)
• $600: Groceries and household items
• $300: Health care (medications, dental, glasses)
• $250: Transport (car fuel, insurance, occasional taxi)
• $500: Social life (dining out, hobbies, visiting grandkids)
• $350: Travel (one short trip a year, plus weekend getaways)
• $200: Contingency (repairs, gifts, unexpected costs)

That’s $3,400 a month. Not luxurious, but comfortable. No debt. No stress. And they still have $1,200 left over each month from their super and Age Pension combined.

Where does retirement income come from?

Your retirement income won’t come from one place. It’s usually a mix of three things: your superannuation, the government Age Pension, and any other savings or investments.

Superannuation is your main tool. If you’ve been contributing 11.5% of your salary since you started working (the current rate as of 2026), and you’ve invested wisely, you could have between $500,000 and $1 million by 65. That’s enough to generate $2,000 to $4,000 a month in income if you use it carefully.

The Age Pension is available to most Australians who meet residency and asset tests. As of early 2026, a single person can get up to $1,021.50 a fortnight (about $2,200 a month) if they have little to no other income or assets. Couples get up to $1,534.50 a fortnight each (about $3,300 a month combined). But if you have too much in super or own a valuable home, your pension gets reduced-or cut off.

Other income might come from part-time work, rental properties, or dividends from shares. Many retirees in Australia work 10-15 hours a week in roles like café staff, library assistants, or tutoring. That extra $500-$1,000 a month can make a huge difference.

What’s a realistic target?

If you want to live comfortably-not rich, but not scraping-you should aim for 70% to 80% of your pre-retirement income. That’s the rule most financial planners use.

For example:

• If you earned $80,000 a year before retiring, aim for $56,000-$64,000 a year in retirement-that’s $4,600 to $5,300 a month.
• If you earned $60,000, target $42,000-$48,000 a year, or $3,500-$4,000 a month.

This works because you won’t be paying work-related costs anymore: commuting, professional clothes, daily lunches, or saving for retirement. But you will spend more on health, leisure, and home maintenance.

Here’s a quick reality check: the Association of Superannuation Funds of Australia (ASFA) says a couple needs $72,577 a year to live comfortably (not just survive). That’s $6,050 a month. A single person needs $51,576 a year, or $4,300 a month. These numbers are updated yearly and include travel, hobbies, eating out, and good health care.

What if you only have the Age Pension?

If you’re relying mostly on the Age Pension, you can still live decently-but you’ll need to adjust.

Many retirees on the full pension live in homes they own outright. They grow vegetables, use public transport, cook at home, and take advantage of senior discounts. They might not fly overseas every year, but they can still see their grandchildren, go to the movies, and enjoy local parks and community events.

One woman in Newcastle, 72, told me: “I get $2,200 a month from the pension. I don’t have a car. I walk to the shops. I grow tomatoes and herbs. My grandson brings me groceries sometimes. I pay $150 a month for electricity. I’m not rich, but I’m not poor. I’m free.”

That’s not a bad life.

How to know if you’re on track

Here’s a simple way to check your retirement readiness:

1. Estimate your monthly expenses in retirement. Be honest-include things like dental, car repairs, and gifts.
2. Add up your expected income: Age Pension + super withdrawals + part-time work + other income.
3. Subtract expenses from income. If you have a surplus, you’re good. If you’re short, figure out how to close the gap.

If you’re $1,000 a month short, you have options:

• Work a few more years-even part-time.
• Downsize your home and use the equity.
• Reduce your spending on non-essentials now.
• Invest more aggressively in your super before retiring.

Don’t wait until you’re 60 to find out you’re underfunded. Check your super balance every year. Log in to your fund’s website. Use the government’s MoneySmart Retirement Planner tool. It’s free, simple, and updated for 2026.

Common mistakes to avoid

People often think retirement is about having enough saved. It’s really about having enough income that lasts.

Here are three mistakes that ruin retirement plans:

• Withdrawing too much too soon. Taking $100,000 out of super in year one to buy a new car? That could cut your income in half over 20 years. Stick to 4-5% of your balance per year as a safe withdrawal rate.
• Ignoring inflation. A $4,000 monthly budget today will need $5,500 in 15 years if inflation averages 2.5%. Plan for your income to rise over time.
• Not planning for health costs. A hip replacement, hearing aids, or long-term care can cost $20,000-$50,000. Have a buffer. Don’t assume Medicare covers everything.

What’s next?

If you’re 50 or older, now is the time to act. Don’t wait for a magic number. Start by calculating your monthly needs. Then compare them to what you’re likely to get. If there’s a gap, make a plan to close it. Talk to a financial adviser if you’re unsure. Or use the free tools on MoneySmart.gov.au.

Retirement isn’t about having a lot. It’s about having enough-and knowing you’ll be okay, no matter what.