Super in today’s dollars: what it means and why it matters

Last updated: 20 October 2026

One projection, two numbers

These three people are projected by OnTrack with the same assumptions (employer super 12%, pay growth 3.7% a year, no extra contributions). The returns are 7%, 7% and 6.1% a year after investment fees and tax.

It’s the same projection each time. The 30-year-old’s future-dollar balance is nearly four times the today’s-dollar figure, because 37 years of wage and price growth have passed. Compare the two columns across people and the order flips: in future dollars the 30-year-old’s balance is the largest, but in today’s dollars the 45-year-old’s is.

How the conversion works

The conversion divides the future balance by a growth factor for each year until retirement. Australian calculators that follow ASIC’s standard assumptions use 3.7% a year before retirement (long-term wage growth) and 2.5% a year after (inflation).

For the 30-year-old: 1.037 raised to the power of 37 years is 3.835. And $2,763,184 ÷ 3.835 = $720,437.

A handy way to read it: with wages growing 3.7% a year, a future dollar is worth about half as much in today’s wage-adjusted terms after roughly 19 years, and about 26 cents after 37 years.

Why wage growth, not inflation, before retirement

Before retirement the conversion uses wage growth rather than prices. The idea is to compare your future balance with the standard of living at that time, because wages usually rise faster than prices. After retirement, income is converted using inflation, because the question then is what the money buys.

It’s a convention, not a prediction. Nobody knows what wages or prices will do over 37 years.

What changes if the rate changes

The rate only affects how the future balance is converted. It doesn’t change the projected future balance itself. For the 30-year-old’s $2,763,184:

That’s one reason two calculators can show different “today’s dollars” results even when their projections are identical. In OnTrack you can change both rates under “Advanced assumptions” on the form. See also why calculators give different answers.

What about retirement income?

OnTrack’s income figure is a level amount in today’s dollars: the yearly amount that would use the balance up by the end age (92 by default). “Level in today’s dollars” means it’s assumed to rise with inflation each year, so it keeps the same buying power. For the 30-year-old, that’s about $46,929 a year. It leaves out the Age Pension and any tax not already modelled, and doesn’t deduct administration fees or insurance separately, so please read it as an illustration.

Common questions

Why is my balance lower than a simple compound-interest calculation? Usually for three reasons. A simple calculation works in future dollars, so convert it to today’s dollars (or switch the calculator to future dollars) before comparing. Concessional contributions, including employer super, have 15% tax taken from them. And some calculators deduct fees and insurance.

Should I use today’s dollars or future dollars? Today’s dollars are usually easier to judge, because you already know what $60,000 a year feels like. Future dollars are useful if you want to see the number you’d actually see on a statement.

Can I change the rates in OnTrack? Yes. The wage growth used for today’s dollars and the inflation rate are both editable, and changing one doesn’t change the other.