For years, $1 million was shorthand for a comfortable Australian retirement. More recently, $2 million has started appearing in retirement projections, calculator results and attention-grabbing headlines.

However, there is no universal superannuation target.

Whether you need $2 million depends mainly on when you retire, how much you plan to spend and whether the Age Pension will eventually support your income.

The superannuation maths, worked backwards

Start with the income, not the balance.

Consider a couple retiring at 60 and funding a 30-year retirement entirely from their own capital. Assuming annual returns of 6% after fees and tax, inflation of 3% and no remaining balance after 30 years, an income of $80,000 a year in today’s dollars requires approximately $1.6 million.

Lifting the desired income to $100,000 increases the starting balance to almost $2 million. If annual returns rise to 7% under the same assumptions, the required balance falls to around $1.75 million.

That is where the $2 million figure becomes relevant. It is approximately what an early-retiring couple needs to fund a six-figure lifestyle without relying on the Age Pension.

Change the retirement age, spending target or return assumption and the number changes with it.

Why ASFA’s benchmark is much lower

The Association of Superannuation Funds of Australia estimates that a comfortable retirement currently costs $55,923 a year for a single homeowner and $78,566 for a couple.

ASFA estimates the corresponding superannuation balances at $630,000 and $730,000 respectively. However, those figures assume retirement at 67, home ownership and access to a part Age Pension over time.

That makes them very different from a couple retiring at 60 and funding everything independently.

The maximum Age Pension is currently worth approximately $31,223 a year for a single retiree and $47,070 combined for a couple. However, it is means-tested. A homeowner couple retiring with $730,000 in assessable assets would generally receive only a part pension, with the entitlement potentially increasing as their assets are drawn down.

At a simple 4% withdrawal rate, replacing the maximum couple pension would require almost $1.2 million of additional capital. That is not precisely how ASFA models retirement, but it illustrates why its recommended balance is so much lower than a fully self-funded target.

The important question is not which benchmark is correct. It is which set of assumptions resembles your household.

Where investors can close the gap

For investors with substantial super balances, contributions are only part of the equation. Returns earned on the existing portfolio can become increasingly influential during the final decade of work.

The Australian share market has historically generated average annual returns of around 9% over long periods, including dividends. Past performance does not guarantee future returns, but it demonstrates how compounding can accelerate as the balance grows.

For example, $600,000 earning a 5% annual return after inflation would grow to approximately $977,000 in today’s dollars over 10 years, without further contributions. If another $15,000 reaches the account each year, the balance could grow to around $1.17 million in today’s dollars.

The final decade before retirement is not necessarily when growth stops mattering. It can be when compounding has the largest pool of capital to work on.

Broad-market exchange-traded funds such as the Vanguard Australian Shares Index ETF (ASX: VAS) and iShares S&P 500 ETF (ASX: IVV) can provide diversified exposure to Australian and international shares.

Australian shares may also generate franking credits, although the benefit received depends on the super fund, account structure and individual tax circumstances.

Shares alone are not a complete retirement plan. Fees, diversification, liquidity and the order in which returns occur all matter. A sharp market fall during the first years of retirement can cause substantially more damage than the same decline earlier in life, making portfolio construction and the drawdown plan just as important as the target balance.

Foolish takeaway

A $2 million superannuation balance is a reasonable target for one particular scenario: a couple retiring early, wanting around $100,000 a year in today’s dollars and planning without the Age Pension.

That is not every Australian household.

For people retiring later with a paid-off home and some Age Pension eligibility, ASFA’s modelling suggests a comfortable retirement may remain achievable with considerably less than $1 million.

The number that matters is not the one attracting headlines. It is the capital required to fund your desired spending from your chosen retirement date, under realistic assumptions about inflation, returns and the Age Pension.

For some households, that may be $2 million. For many others, it will be substantially less.

The post Is $2 million really the new superannuation target? appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended iShares S&P 500 ETF. The Motley Fool Australia has recommended iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

NextDC Ltd (ASX: NXT) shares have been on the rise, gaining 12% over the past month to $14.73. The stock is up 20% year to date, although it’s only 4% higher over the past 12 months.

Some of the recent momentum appears to be coming from strong earnings from US technology giants including Apple Inc (NASDAQ: AAPL) and Alphabet Inc (NASDAQ: GOOG). But could there be more to the NextDC story?

At the heart of data centre expansion

NextDC operates data centres, increasingly critical infrastructure underpinning the digital economy. The tech company is positioning itself at the heart of this expansion, with a growing Australian footprint and ambitions across Asia.

It recently opened its first AI-ready facility in Kuala Lumpur and is developing facilities specifically designed for Artificial Intelligence workloads, including its S6 Sydney data centre.

The long-term opportunity is compelling. As businesses increasingly use cloud computing, AI, streaming, online payments, cybersecurity tools and other data-heavy software, demand for secure and reliable data centre capacity should continue growing.

NextDC appears to be executing well. It reported pro forma contracted utilisation of 740MW at 30 June 2026, up 11%, while its pro forma forward order book expanded to 565MW.

Investors in NextDC shares will get more detail when the company releases its FY26 results on 27 August.

Could AI provide another catalyst?

The recent share price strength of NextDC shares has coincided with upbeat results from major US technology companies. Strong spending and growth expectations from tech giants may be encouraging investors to look more closely at Australia’s data centre sector.

But there could be a more interesting catalyst beneath the surface.

In July, AI company Anthropic was reportedly running a confidential tender for at least 1.4GW of Australian data centre capacity as it prepares for a potential $3 billion IPO in October. NextDC was reportedly among the operators approached.

If AI companies continue securing enormous amounts of computing infrastructure, NextDC could be well positioned to benefit.

Analysts see plenty of upside

TradingView data shows nine of 10 brokers rate NextDC shares a buy or strong buy. The average price target is $21.60, implying around 47% upside from the current share price.

The most bullish target is $32.29, suggesting potential upside of about 119%, while the most pessimistic target still implies roughly 5% upside.

UBS is among the bulls, maintaining a buy rating and a $22.55 price target.

With AI driving a surge in demand for data centre capacity, NextDC could be a stock worth watching closely.

The post Could the AI boom just be getting started for NextDC shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Marc Van Dinther has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet and Apple. The Motley Fool Australia has recommended Alphabet and Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Healius Ltd (ASX: HLS) share price was in focus today after the company delivered a 2.2% increase in revenue to $1,373.2 million for FY26, with underlying net loss shrinking by 46.8% to $13.2 million.

What did Healius Limited report?

• Revenue from continuing operations rose 2.2% to $1,373.2 million (FY25: $1,344.2 million)
• Underlying EBITDA grew 8.1% to $258.6 million
• Underlying EBIT jumped 76.6% to $30.2 million
• Underlying loss after tax improved to $13.2 million from $24.8 million a year ago
• Reported loss after tax widened to $415.6 million, from $151.2 million, due chiefly to a $332 million non-cash goodwill impairment
• No dividend declared for FY26 (FY25: 41.3 cps special dividend)

What else do investors need to know?

Healius delivered operational improvements despite headwinds in the healthcare sector, including increased labour costs and limited Medicare indexation. Cost management helped contain annual spend, aided by a detailed workforce optimisation program reducing headcount by around 5%.

The Agilex Biolabs division performed strongly, growing revenue by 14.1% and EBITDA by over 67%. The company is reviewing strategic options for Agilex Biolabs, and an update for shareholders is expected ahead of the AGM.

Healius completed the major phase of its digital transformation program, with most collection centres now processing over 80% of episodes digitally. AI‑driven initiatives are delivering productivity gains and will continue to be rolled out across back-office and laboratory operations.

What’s next for Healius Ltd?

Looking ahead, Healius is focused on expanding higher margin revenue streams in diagnostics, capturing benefits from its completed digital platform rollouts, and further lifting network productivity. The group expects full-year labour cost pressures from regulatory changes, but remains confident about healthcare demand trends over the medium to long term.

The company maintains a strong balance sheet, ending FY26 with net debt of $32.8 million and well within its banking covenants. Management continues to target improved cashflow and margin restoration in FY27.

Healius Ltd share price snapshot

The Healius share price has been sold off over the past 12 months and is down 45%. This compares to a modest 2% gain by the S&P/ASX 200 index (ASX: XJO).

View Original Announcement

The post Healius posts FY26 revenue growth, narrows underlying loss appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.