**Disclaimers and assumptions**

The purpose of this calculator is to illustrate how much you could potentially add to your retirement savings by reducing your spending on luxury items and making additional voluntary contributions to your superannuation, based on the information that you provide and the stated assumptions. The information it contains is of a general nature only.

The results provided by the calculator are estimates only and are not guaranteed. Actual outcomes depend on uncertain factors such as investment returns and relevant legislation.

The calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. In making any decisions about your superannuation or your retirement you should consider your own objectives, financial situation and needs. You should consider obtaining advice from a licensed financial planner before making any decisions.

**Items**

The calculator estimates the costs to you of purchasing everyday items. In giving up one or more items in the calculator, you are then assumed to save an amount equal to the estimated cost of the item(s).

The estimated costs do not necessarily represent the exact amounts you would save to you if you were to give up the item, at the specified frequency, as represented by the calculator.

If you want to add other monthly contributions that you might make for giving up items not referred to in the calculator, or if you want the calculator to assume that the cost per month of purchasing an item listed in the calculator is different to the default assumption, you can insert a monthly contribution amount in the ‘Other contributions’ item.

**Contributions**

Savings that you make for giving up one or more items in the calculator are assumed to be added as regular non-concessional contributions into superannuation. The calculator assumes that these contributions can be made within your non-concessional contribution limits (being $110,000 per annum or $330,000 in one year by utilising the “bring forward” rule), and so no tax is levied on these contributions.

**Inflation**

The projection allows for future wage inflation of 4.0% pa and future price inflation of 2.5% pa.

These assumed inflation rates are consistent with ASIC Corporations (Superannuation Calculators and Retirement Estimates) Instrument 2022/603.

You can change the assumed rate of inflation in the “Edit assumptions” section.

**Results are in today’s dollars**

Results are expressed in today's dollars by discounting with wage inflation in the accumulation phase and price inflation in the pension phase. This means the amounts shown are adjusted for inflation (and so take into account the assumed change in the cost of living between the time of preparing the estimate and the future time).

Target income is also assumed to increase at this rate.

This approach to discounting is consistent with ASIC Corporations (Superannuation Calculators and Retirement Estimates) Instrument 2022/603.

**Investment earnings**

The Modeller assumes the following default investment returns (after fees and tax) for each investment strategy:

### Investment option | ### Assumed investment return per annum (after fees and tax) |

Cash | 2.2% |

Conservative | 4.0% |

Balanced | 6.0% |

High Growth | 6.5% |

These default investment returns (except for Cash) have been determined by adding the investment objective for each corresponding investment option in the PSSap (Income Focused, MySuper Balanced and Aggressive) to CPI, which we have assumed to be 2.5% pa.

For Cash, investment return is expected to be close to that of the Bloomberg Ausbond bank bill index by investing 100% in Cash assets. The default assumed investment return for Cash is based on long term expectation of short term interest rates and is higher than current bank bill rates.

The default investment returns assumed by the Retirement Modeller are illustrative only and should not be taken to provide an estimate of the amount of investment returns you may receive.

Investment earnings in Accumulation accounts are taxed.

You can change the assumed investment returns (net of fees and taxes) of each investment option in the “Edit assumptions” section.

**Administration fees, investment fees and insurance premiums**

The calculator assumes that saved amounts are contributed to an existing superannuation account. No additional dollar-based fees would therefore be incurred by virtue of making these contributions, and dollar-based administration fees and insurance premiums are ignored for the purpose of this calculator.

Additional contributions into superannuation would result in a higher superannuation balance, and so higher asset-based fees. Asset-based fees (including administration fees and investment fees) are therefore allowed for in this calculator, however are reflected in the net investment returns.

**Legislative assumptions**

A number of assumptions in this calculator are prescribed by legislation. These assumptions include: the tax on superannuation contributions and the tax on investment earnings.

Where there is relevant legislation, the assumptions made in this calculator reflect current legislative arrangements. One uncertainty regarding future superannuation entitlement relates to possible future legislative changes.

Although some future changes in the legislation relating to superannuation are likely, it is not possible to know what these changes may be. Where there is relevant legislation, current legislative arrangements therefore represent the most reasonable basis for estimating future superannuation entitlement.

Updates to legislative assumptions are made as soon as practicable after such changes are announced. The calculator is based on legislation in force as at September 2022.

**Limitations**

This calculator attempts to include the most significant and relevant features of the superannuation environment, and to do so in an accurate manner. However a calculator such as this is not able to address or include all facets of superannuation. The most significant limitations are:

• The calculator performs a “deterministic” projection.

This means that the assumptions such as investment returns are assumed to be constant every year, at the rates indicated above. The actual investment returns will vary from year to year. More aggressive investment options, with higher expected returns, would be expected to exhibit a more significant range of outcomes. The calculator does not show the range of possible outcomes.

In this calculator, selecting a more aggressive investment option will present a more favourable outcome. However there is also likely to be more uncertainty attached to this outcome. You should consider this carefully before selecting an investment option.

• Co-contributions are not included in the calculator. As the calculator assumes that saved amounts are contributed to superannuation as non-concessional contributions, you may also be eligible for co-contributions (if your salary is less than $57,016 pa). If you were eligible for co-contributions this would potentially increase the benefit of saving amounts related to giving up an everyday item.

• Instead of savings by making non-concessional contributions, an equivalent pre-tax amount could be saved by making concessional contributions. For most people this would increase the benefit of savings due to the lower tax payable on concessional contributions compared to salary.