3 key moves young Australians can make to have $1m more in retirement

Young Australians can rightfully feel they've been dealt a bad hand when they compare their prospects to the economic possibilities enjoyed by previous generations.

A housing crisis, low wage and productivity growth, persistent inflation and the general erosion of living standards have been ever-present in the working lives of young Australians, and the threat of AI, climate change and geopolitical turmoil make the future even more uncertain. 

The federal government's 2026 Intergenerational Report, released in mid-September, laid out the economic reality of young Australians in stark terms:

"Household wealth and incomes are expected to keep rising over time, but younger generations have not been experiencing the same gains as prior generations."

Confronted with this reality, it's easy to feel helpless. But that reality is actually what makes it so important for young Australians to start taking more control of their economic future, and retirement is a crucial part of that.

I recently spoke to two financial advisers, Rebecca Hurford from Infocus and Sebastian Ferrando from Koda Capital, to get their views on what young Australians should be doing right now to set themselves up for a more comfortable retirement. 

They discuss the steps you can take today, to strategies around super, tax and investing that could leave you more than $1-million-dollars better off in retirement. Watch the full interview below or read on for the key takeaways.

Please note this interview was filmed on 18 September 2026. 

3 moves to make right now (if you haven't already)

1. Start saving

One of the most straightforward strategies for building wealth is simply to start saving, according to Hurford.

"Commencing a regular savings regime as early as possible in our life and being dedicated and consistent with maintaining that savings regime over the long term can really harness the power of dollar-cost-averaging," she says.

Not only does saving help improve your discipline around money, it lets you unlock the full power of compounding returns, especially if you then invest those savings into growth-focused assets.

She says one approach that has held her in good stead is actively trying to avoid lifestyle creep as your earnings increase.

2. Optimise your tax obligations 

Many young Australians won't have given much thought to the tax optimisation strategies that are available to them, but it's another avenue of opportunity that can have a huge impact on their ability to build wealth and save for retirement. 

"Every dollar of tax that we save is an extra dollar that stays in our own pocket," Hurford says.

The recent changes to capital gains tax have made options like salary sacrificing into super and investment bonds more attractive. But it's the former that arguably presents the best tax optimisation strategy for young Australians. 

The Intergenerational Report came to the same conclusion: "Younger Australians will benefit from a maturing superannuation system that will play an increasingly important role in supporting them in retirement."

As we'll explore below, committing to salary sacrificing from a young age can leave you with hundreds of thousands, or even a million dollars, more in retirement.

3. Rethink your investments

Another consideration is optimising where and how you actually invest. While it can be tempting to just stick to what you're familiar with, for instance Australian shares, that can mean leaving returns - and therefore money - on the table.

"Every country in the world has home country bias, but the truth is that only one country can afford it, and that's the US," argues Ferrando. 

"Aussies are just way too Aussie-biased in their equity allocations. If you need income, Aussie equities are great, but if you need growth, they're not so great."

His first piece of advice is to think about where you're allocating your capital if the goal, as it should be when you're young, is long-term growth.

"Tilt much more into international equities than Aussie equities."

Part of the thinking here is that the investing landscape, and the economic challenges facing young Australians today have changed substantially from what they were for previous generations.

"For old people like me, when I grew up, everyone told you to buy fully franked-paying dividend Aussie shares and buy real estate and you'll get rich," says Ferrando. 

"If you need somewhere to live, if you need somewhere to raise your family, please, by all means, go buy a house. Great. But as an investment - it is a genuinely subpar investment."

"I get a lot of pushback, people telling me 'what about the leverage and all that other stuff?' Go to my Livewire article from two years ago and read it. Even after leverage, there are much better options than real estate."

The importance of super and planning ahead

While there are other strategies and investments worth pursuing, super will ultimately sit at the heart of your retirement plan. 

Investing in super, and specifically salary sacrificing as soon as feasible, allow you to reap the full benefits of the two factors that can be the difference between a sub-optimal and comfortable retirement - minimising tax and maximising the power of compounding returns.

Super is typically taxed at 15%, far below the income tax rate you'll likely be paying throughout your career. Taking advantage of additional super contribution allowances is one of the first things you should consider when thinking about your economic future.  

The second is understanding the super fund you're currently with, what it invests in, and what you might want to consider instead, says Ferrando.

"Most people spend more time planning their next holiday than their financial life. One of the things I beg people to do is just spend a little bit of time looking at this stuff," he says.

"The difference is that over a 15-year period, if you make 12%, you 5.5x your money. If you make 10%, you 4x your money. These are relatively big numbers in particular over a long period of time. So my point to her was, and my point to young people generally is, if you are sub-40, you should be 100% international shares in your super fund."

And that touches on one of the big risks Hurford sees young people making around their financial future - failing to adequately plan out their strategy.

"The biggest mistake is ultimately just making uninformed decisions. People quite honestly will put the blinkers on," she says.

But there is no such thing as universal advice, and both Ferrando and Hurford recommend young Australians speak to a financial adviser to get information that is tailored to their personal circumstances.

How this could mean an extra $1 million in retirement

Hurford uses the real-world example of her son, who has just entered the workforce and is already salary sacrificing. She has simulated three different scenarios for how he approaches retirement, specifically whether he starts saving now at age 20, starts at age 40 or starts at age 50. 

The difference in outcomes in retirement is extreme, depending on how early he starts. In fact, using fairly modest savings goals can still see a young person more than a million dollars better off in retirement if they start early enough. 

Scenario 1 - Starting young

"Let's imagine we're 20," said Hurford. "Let's imagine we're consistently saving $500 a month for 40 years until we get to the age of 60. We've invested $240,000 across that whole period of time, so $6,000 a year."

"If I'm investing in growth-oriented assets like share funds or super and shares through super, let's imagine we're getting about an 8% return on average over the long run. By the time I'm 60, that $240,000 will have turned into $1.75 million."

Scenario 2 - Starting in middle age

Scenario 3 - Starting near retirement

"Let's look at those who might leave it till that last decade," she said. "They have their 50th birthday party and they think, "Wow, retirement is just around the corner. I better start saving for it." 

"Let's assume they invest $2,000 a month for that 10-year period, so still the same total of $240,000. Let's assume they're still earning 8%. The value at the end of that 10-year period will be $368,000. I did not give myself time to actually allow the money to work for me. It's a massive difference."