Financial Health Check at 40: How Much Should You Have by Now?
How much super, savings, and net worth should a 40-year-old have in Australia? Real data, ASFA benchmarks, and actionable steps for your financial health at 40.
Where should you be financially at 40 in Australia?
Age 40 is the financial midpoint of your working life, and it is the age where your financial position starts to have very tangible implications for your retirement outlook, your housing security, and your long-term options. According to ABS data, the median net worth for Australians aged 35 to 44 is approximately $400,000. This figure is dominated by property equity — homeowners in this age group have a median net worth roughly five to six times higher than renters. The average superannuation balance for Australians aged 40 to 44 is approximately $110,000, though the median (which strips out the distorting effect of very high balances) is closer to $80,000 to $90,000. If you have worked full-time continuously since your early twenties on an average income, your super should be in the $90,000 to $130,000 range at 40. Cash savings and investments outside of super and property vary enormously. Some 40-year-olds have $100,000 or more in investments and savings, while others have minimal liquid assets because their wealth is concentrated in their home. The common financial planning benchmark suggests having three times your annual salary in total assets by age 40. On a salary of $90,000, that means $270,000 across super, savings, investments, and property equity. This is a useful yardstick but not a definitive measure of financial health. What matters more at 40 is whether your financial trajectory is positive, whether you are adequately insured, whether your debt is manageable and declining, and whether you have a realistic plan for the 25 to 27 years until retirement. Run our Money Check tool to get a detailed assessment of where you stand against Australian benchmarks for your age group.
Super at 40: the critical checkpoint for retirement planning
Your super balance at 40 is arguably the single most important number in your financial life, because it determines whether you are on track for a comfortable retirement or whether you need to take corrective action while you still have 20 to 27 years of working life ahead. The ASFA Retirement Standard estimates that a single person needs approximately $690,000 in super at retirement for a comfortable lifestyle, while a couple needs around $690,000 combined. The average super balance at 40 to 44 is approximately $110,000. With employer contributions on a median salary and average investment returns of 7% per annum after fees, a $110,000 balance at 40 would grow to approximately $490,000 to $550,000 by age 60. Add in ongoing employer contributions over those 20 years, and a 40-year-old with $110,000 today is roughly on track for the ASFA comfortable standard — but with very little margin for error. Career breaks, periods of part-time work, or a prolonged market downturn could leave a shortfall. If your super is below the $110,000 average, you still have time to close the gap, but action is needed now. Salary sacrificing is the most tax-effective strategy. If you earn $95,000 and salary sacrifice $10,000 per year into super, you save approximately $1,950 in tax annually (the difference between your 32.5% marginal rate and the 15% super contributions tax), and that $10,000 per year compounding at 7% over 20 years grows to approximately $440,000. Combined with your existing balance and ongoing employer contributions, this could add $200,000 or more to your retirement outcome. Check that your super fund is performing well relative to benchmarks — APRA publishes annual performance data. A fund consistently underperforming the median by even 0.5% per year costs you tens of thousands over two decades. If your fund is underperforming, switching is straightforward and can be done through your new fund directly.
Net worth at 40: property, debt, and the full picture
Net worth at 40 is where the property divide in Australian wealth becomes starkly apparent. The median net worth of $400,000 for the 35 to 44 age group is heavily influenced by homeowners who purchased property before or during the post-2020 boom. A 40-year-old couple who bought a $700,000 house in 2020 with a $100,000 deposit may now have $400,000 to $500,000 in equity on a property worth $900,000 to $1 million, making their net worth appear very strong despite having relatively modest savings outside of their home. Conversely, a 40-year-old renter with $80,000 in savings, $110,000 in super, and $30,000 in shares has $220,000 in net worth — below the median but entirely in liquid, productive assets rather than locked in a single illiquid property. Debt composition matters enormously at 40. A mortgage is generally considered productive debt because it builds equity in an appreciating asset, and mortgage interest rates are among the lowest available. Consumer debt — credit cards, personal loans, car finance — is destructive at any age but particularly harmful at 40 because every dollar paying interest on consumer debt is a dollar not compounding in savings or super. If you have consumer debt at 40, paying it off should be your top financial priority after maintaining your emergency fund. HECS-HELP debt, if you still have it at 40, is indexed to CPI rather than charging commercial interest, so it should remain a low priority for voluntary repayment. At 40, you should also have adequate insurance coverage. Income protection insurance becomes critical at this age because you likely have dependents, a mortgage, and financial obligations that would be devastating to lose income for an extended period. Check your super fund's insurance offerings — many include default life and total permanent disability cover, but the default levels may not be adequate for your circumstances.
Catching up at 40: it is not too late but urgency matters
If you have reached 40 with a super balance well below $110,000, minimal savings, or significant consumer debt, the window for corrective action is narrowing but far from closed. You still have 20 to 27 years of working life and earning capacity ahead, which is enough time to build meaningful wealth — but it requires deliberate, focused action starting now. The most impactful step is maximising your super contributions. The annual concessional contributions cap is $30,000 (including employer contributions). If your employer contributes $10,000 per year, you can salary sacrifice up to $20,000 more. On a $95,000 salary, this reduces your take-home pay by approximately $15,600 (after the tax benefit), but adds $20,000 per year to your super. Over 20 years at 7% returns, that additional $20,000 per year grows to approximately $880,000 — potentially transforming your retirement outlook. If you have unused concessional cap space from previous years (since 2018-19), you may be able to carry forward unused amounts and make larger contributions in a single year, up to a total of $150,000 in unused cap space. Check your available cap space through myGov. Outside of super, focus on building a diversified investment portfolio. At 40, you still have a 20-plus year investment horizon, which means you can tolerate moderate risk for higher expected returns. Low-cost diversified ETFs remain the simplest approach for most investors. Automate $500 per month into an investment account, and over 20 years at 8% average returns, you will accumulate approximately $295,000 in accessible wealth. If you are behind on savings specifically because of life events — divorce, illness, career change, caring responsibilities — investigate government support through BenefitsMate. There may be concessions, supplements, or co-contributions you are not aware of. If you are concerned about your employment entitlements or whether you are being paid correctly, check with FairWork Mate.
Financial priorities for your forties: what to focus on next
Your forties should be your peak earning and wealth-building decade. Median incomes peak between 40 and 55, and if you manage this period well, you can enter your fifties in a position of genuine financial security. Here are the priorities that matter most. First, maximise your super contributions within the concessional cap. This is the most tax-effective wealth-building tool available to Australians, and every year you delay costs you in lost compounding. Even if you cannot manage the full $20,000 in voluntary contributions, start with $5,000 and increase by $2,000 each year. Second, protect your income. Income protection insurance should cover at least 75% of your salary for a benefit period of at least two years, and ideally to age 65. The cost is typically tax-deductible if you hold the policy outside of super. Without income protection, a serious illness or injury could wipe out decades of savings. Third, review your estate planning. At 40, if you have dependents, you need a valid will, appropriate life insurance, and nominated beneficiaries on your super fund. These are not pleasant topics but they are essential. Fourth, manage your mortgage strategically. If you have a mortgage, consider whether you are on the most competitive rate available — even a 0.25% rate reduction on a $500,000 mortgage saves approximately $15,000 over the remaining loan term. Making extra repayments can also save tens of thousands in interest and shave years off your loan. Fifth, invest in your financial literacy. Understand how the super system works, how tax deductions apply to your situation, and how investment returns compound. Knowledge at 40 translates directly into better financial decisions for the next 25 years. Use our Money Check tool to establish your baseline, then revisit quarterly to track your progress. The decisions you make in your forties determine whether your fifties are spent building wealth or scrambling to catch up.
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General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.
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