What is superannuation?

Superannuation ("super") is Australia's compulsory retirement savings system. Employers must pay a set percentage of each worker's earnings — 12% as of 2026 — into an investment account the worker personally owns. A super fund invests the money, and the balance is generally locked away until retirement age.

What percentage is superannuation in Australia?

The Super Guarantee rate is 12% of ordinary time earnings, effective 1 July 2025. That was the final step in a long series of legislated increases, and no further rises are currently scheduled. Workers can add their own voluntary contributions on top.

Is superannuation the same as a 401(k)?

They're structurally similar — both are individually owned, invested, tax-advantaged retirement accounts. The big differences: super contributions are compulsory for employers while 401(k) participation is optional, and a super account follows the worker automatically between jobs, whereas a 401(k) typically requires a rollover when you change employers.

Can I access superannuation early?

Generally no. Super is "preserved" until you reach preservation age — 60 for anyone born after 30 June 1964 — and retire, or until age 65 regardless of whether you're still working. Limited early-release exceptions exist, such as severe financial hardship and certain medical grounds.

What would 12% of my salary grow to?

On a $60,000 salary, 12% is $7,200 a year. Invested at a 7% annual return, that grows to roughly $99,000 after 10 years, $295,000 after 20, and about $680,000 after 30 — of which only $216,000 was ever contributed. The rest is compounding.

Superannuation Calculator — Project Your Super Balance

Enter a salary, an employer contribution rate (Australia's Super Guarantee is 12% as of 2026), an expected return, and years to grow. You'll get a projected balance plus a milestone table splitting contributions from investment growth.

How Australia's superannuation system works

Superannuation is Australia's compulsory retirement savings system, and its design is simple: every employer must pay a legislated percentage of each worker's ordinary earnings — the Super Guarantee, which reached its final legislated rate of 12% on 1 July 2025 — into an investment account the worker personally owns. The money goes into a super fund (workers choose their fund and investment mix), it compounds for decades, and it's preserved: as of 2026 you generally can't touch it until age 60 and retired, or age 65 regardless. One account follows you from job to job. From July 2026 employers must pay it every payday rather than quarterly.

The system has been in the news in the United States, where policymakers have discussed whether a similar model could work there. This page takes no position on that — it explains how the system operates and lets you run the numbers yourself.

The formula

Balance = B₀ × (1 + r)^t + S × c × [ (1 + r)^t − 1 ] / r

B₀ is your starting balance, S your annual salary, c the total contribution rate as a decimal (employer plus any extra), r the expected annual return as a decimal, and t the years to grow. This calculator simulates year by year: the balance earns a year's return, then that year's contributions are added. By default it assumes a flat salary — a deliberate simplification that makes results conservative, since pay usually rises. Enter a wage growth percentage to model rising contributions instead. Results ignore fees, taxes, and inflation.

Worked example

A $60,000 salary with the 12% Super Guarantee, earning 7% a year, from a zero starting balance:

Contributions are $7,200 a year. After 10 years the balance is about $99,478; after 20 years, $295,168; after 30 years, roughly $680,118 — of which only $216,000 was ever contributed. Left for 40 years it passes $1.43 million. Each decade adds more than all the decades before it combined; that's compounding, not magic.

How super compares to a US 401(k)

Structurally, a super account and a 401(k) are cousins: both are individually owned investment accounts with tax advantages, and the worker bears the market risk and keeps the market gains. The differences are about defaults. Super is compulsory — every employer pays 12% for essentially every worker, no sign-up required — while a 401(k) is opt-in, offered at the employer's discretion, with participation and contribution rates the worker must choose. Super is also automatically portable: the same account simply keeps receiving contributions when you change jobs, where a 401(k) usually means a rollover (or a forgotten account). The math this calculator shows applies equally to both: a double-digit percentage of salary, invested for 30-plus years, does most of the work through growth rather than deposits.

Superannuation Calculator