Superannuation Calculator

How the projection is built

Each year the model adds employer contributions of 12 per cent of your salary, takes 15 per cent contributions tax off them, grows the balance by your chosen return, and increases your salary by the growth rate you set. It runs the loop once per year from your current age to your retirement age.

The two simplifications matter. Contributions are invested only halfway through the year on average, which is why the model applies a half-year of return to them rather than a full one. And it ignores fees, insurance premiums inside super, and the 15 per cent tax on earnings in accumulation, all of which reduce a real balance.

The superannuation guarantee over time

The guarantee applies to ordinary time earnings, which excludes some allowances and overtime. If you are paid a package that includes super, the 12 per cent comes out of that total rather than being added on top, so check which arrangement you are on before comparing offers.

Caps, tax and the rules that bite

• Concessional contributions, which include employer contributions and salary sacrifice, are capped at $30,000 a year. Amounts above the cap are taxed at your marginal rate.
• Non-concessional contributions are capped at $120,000 a year, subject to your total super balance.
• Contributions are taxed at 15 per cent on the way in. Earnings in accumulation are also taxed at 15 per cent; in retirement phase they are generally tax-free.
• From age 60, withdrawals from a taxed fund are tax-free for most people, and preservation age is 60.
• You can normally access super only at preservation age and after retiring, so it is not an emergency fund.

Reading a projection honestly

A projection is a straight line through a wobbly reality. Sequence matters: a bad decade early costs more than the same bad decade late, because the early loss compounds against you. Returns are not steady, fees are real, and policy changes every few years.

1. Run it twice with a conservative and an optimistic return, and plan on the lower one.
2. Check fees on your actual fund: a 1 per cent fee difference over 30 years removes roughly a quarter of the final balance.
3. Compare against the Age Pension, which is means-tested, so a larger balance reduces other income.
4. Add voluntary contributions in the model to see whether the cap or your budget binds first.

General information only, not personal financial product advice. Consider your own circumstances or speak to a licensed adviser before changing your contributions.

What each input means

The calculator asks for 6 pieces of information. Every field is validated before the maths runs, so an impossible value is refused rather than quietly producing a wrong answer.

A worked example using the default inputs

With annual salary of 95000, employer contribution rate of 12 %, current super balance of 45000, years until retirement of 30 years, annual investment return of 7 %, the calculator returns A$1,642,578 A$461,006 contributed.

The same arithmetic runs whatever you type into the form above, so you can reproduce any figure by matching the inputs listed here.

How this is calculated

Each year: balance = balance × (1 + return) + contribution × 0.85 × (1 + return ÷ 2). Contributions are 12% of the growing salary and are taxed at 15% before they are invested.

Working values are kept at full precision and rounded only for display. Impossible dates, zero denominators, negative amounts where they make no sense, and out-of-range values are rejected before any result is shown.

The methods behind these money tools

Almost everything in this section is one of six calculations. Once you know which one a tool is running, the result stops being a black box: you can check it roughly on paper, and you can see which input is doing the work.

Two conventions matter more than any formula. First, the rate and the period must match: a 6% annual rate over monthly payments is 0.5% per month and 360 periods, not 6% per period. Second, money paid later is worth less than money paid now, which is why an amortising loan charges interest on the opening balance of each period rather than on the average balance.

Nominal and real returns are different things. A 7% return with 3% inflation buys roughly 3.9% more each year, not 7%: real rate ≈ (1 + nominal) ÷ (1 + inflation) − 1.

Two worked examples from this section

These scenarios use the same arithmetic as the tools above, so you can follow the numbers from input to result and then repeat them with your own figures.

A 30-year mortgage of $600,000 at 6.1%

The monthly rate is 6.1% ÷ 12 ≈ 0.5083% and there are 360 payments. Feeding those into the amortising payment formula gives a fixed instalment of about $3,636.

Monthly principal and interest

≈ $3,636

Total repaid over 30 years

≈ $1,308,900

Interest paid in total

≈ $708,900

Share of the total that is interest

≈ 54%

Notice that more than half of everything paid is interest. That is the single most useful fact a mortgage calculator produces, and it is why a small change in rate or term moves the total so much more than it moves the monthly figure.

Adding and removing 10% GST on $250

Adding tax is a multiplication; removing it is a division by the same factor, never a subtraction of the same percentage. Subtracting 10% from a GST-inclusive price gives the wrong answer because the tax was charged on the smaller, exclusive amount.

$250 plus 10% GST

$275.00

GST component

$25.00

$275 with GST removed (275 ÷ 1.1)

$250.00

The common mistake (275 − 10%)

$247.50 — too low

The same split works for any rate: divide by one plus the rate to go backwards. For 15% VAT, divide by 1.15; for 18% GST, divide by 1.18.

Assumptions behind every finance figure

Results are computed in exact arithmetic and only rounded for display, so a payment shown as $2,413.65 comes from the unrounded monthly rate rather than from a rounded one. Where a calculator compounds, it compounds at the frequency you choose; where it amortises, it assumes payments land at the end of each period unless the tool says otherwise.

Tax and contribution rates are the legislated rates for the tax year noted in each tool. They change, sometimes retrospectively, and none of these tools can see your personal circumstances: deductions, offsets, salary sacrifice, HELP or student loan balances, private health cover, investment losses, provincial or state tax, and treaty arrangements are all outside the model.

• Lenders and tax offices round differently from us, and they use daily interest, fees and assessment rules that a formula cannot reproduce. Expect small differences from an official statement.
• Nominal returns are not real returns. A 7% return with 3% inflation buys about 3.9% more each year, not 7%.
• Every figure is a planning estimate. For a decision with money at stake, confirm it with the lender, the tax office or a licensed adviser.

Sources and further reading

• Australian Taxation Office: superannuation guarantee rate
• ASIC Moneysmart: how super works
• Australian Taxation Office: tax rates and codes
• Reserve Bank of Australia: interest rates
• Moneysmart (ASIC): budgeting and borrowing