A $50,000 annual retirement income sounds achievable, but the amount of superannuation needed to fund it may be higher than many Australians expect.

For someone aiming to retire with that level of income, a $1 million super balance is often cited as a useful benchmark.

But there is no magic number. How long the money needs to last, investment returns, withdrawals and access to other income streams can dramatically change the equation.

Is $1 million in superannuation enough?

The appeal of a $1 million super balance is obvious. A retiree withdrawing $50,000 a year would initially be drawing 5% of their portfolio. The catch is that retirement isn’t simply about dividing $1 million by $50,000.

The money remaining in superannuation can continue to generate investment returns, potentially allowing the balance to support withdrawals for decades. But markets don’t move in a straight line, and poor returns early in retirement can put significant pressure on a portfolio.

Inflation is another consideration. A $50,000 annual income today won’t necessarily provide the same purchasing power 10 or 20 years from now.

That’s why retirees need to think beyond the headline super balance.

Investments could make or break the plan

The way retirement savings are invested can have a huge impact on how long they last.

A portfolio heavily weighted towards cash may provide stability, but could struggle to keep pace with inflation over a long retirement. Meanwhile, a portfolio with substantial exposure to shares can potentially deliver stronger long-term growth, but comes with greater volatility.

For many retirees, the challenge is finding the right balance between generating income and preserving enough capital to fund future years.

The timing of superannuation withdrawals matters too. Taking substantially more than $50,000 in some years could accelerate the depletion of a portfolio, while spending less during weaker market periods may help preserve capital.

Don’t forget the Age Pension

Superannuation also isn’t necessarily the only source of retirement income.

Eligible Australians may receive the Age Pension, depending on factors including their income and assets. That means someone targeting $50,000 a year may not need their superannuation to provide the entire amount.

This can materially reduce the amount of savings required, although eligibility and payment rates can change over time.

The real question isn’t just ‘how much?’

For someone targeting $50,000 a year, $1 million in superannuation could provide a substantial foundation. But whether it’s enough depends on factors including investment performance, inflation, spending habits, retirement age, longevity and other sources of income.

That’s what makes retirement planning tricky: the goal isn’t simply accumulating a particular number. It’s building a portfolio capable of supporting the lifestyle you want without running out of money.

For investors still building their superannuation, the takeaway is potentially encouraging. There are multiple levers to pull, including contributions, investment strategy and retirement timing, that can improve the odds of turning a sizeable super balance into a sustainable retirement income.

The post Want $50,000 a year in retirement? Here’s how much superannuation you may need 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 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.

Some ASX shares are trading a long way below where investors were willing to value them only a year ago.

That doesn’t automatically make them bargains, but I think it can create an opportunity when the long-term business case remains strong.

These are two ASX shares I would be comfortable buying at today’s lower prices.

Cochlear Ltd (ASX: COH)

Cochlear shares are trading around $137.88 at the time of writing, compared with a 52-week high of $303.74. That puts the stock roughly 55% below its high.

I think the size of that fall deserves attention because Cochlear still operates in a market with a significant amount of unmet demand.

The company develops cochlear implants for people with severe hearing loss, yet many potential candidates around the world are never referred for treatment or ultimately receive an implant.

For me, that leaves a long runway even before considering population growth and ageing.

Cochlear also continues to improve the technology itself. Its newer Nucleus Nexa platform gives the company another opportunity to encourage upgrades and make treatment more attractive to future recipients. Longer term, developments such as personalised stimulation, drug-eluting electrodes, and potentially totally implantable devices could continue improving the patient experience.

Healthcare companies can go through periods when growth disappoints or investors become less willing to pay premium valuations. I think that’s where we are right now. But that disappointment won’t last forever.

As such, I would be happy to buy Cochlear at today’s level and give the underlying growth opportunity time to play out.

Nextdc Ltd (ASX: NXT)

NEXTDC shares are also trading well below their previous high.

At around $12.30 at the time of writing, the data centre operator is roughly 31% below its 52-week high of $17.85.

I continue to think the long-term opportunity behind the ASX share is substantial. NEXTDC is investing heavily to expand its data centre network as demand grows from cloud computing, artificial intelligence, and other digital workloads.

What I like is that the company already has a large amount of customer demand contracted before all that capacity has been completed. That gives me more confidence in the expansion strategy.

As new data halls are completed and contracted, and customers begin using them, more of that capacity should start contributing revenue.

There is still plenty to watch. Data centres require enormous amounts of capital, and NEXTDC needs to build efficiently, secure sufficient power, and manage its funding as the network expands. But those are risks I am willing to accept given the scale of the opportunity.

At $12.30, I think investors are getting a much more attractive entry point than they had near the 52-week high.

Foolish takeaway

Neither Cochlear nor NEXTDC needs to return to its previous high for me to be interested today.

I like the growth opportunities behind both businesses, while their much lower share prices give investors a very different entry point from where they traded previously.

If Cochlear keeps reaching more patients and NEXTDC successfully converts its contracted demand into operating data centre capacity, I think both ASX shares have plenty of room to recover over the years ahead.

The post 2 ASX shares I’d buy before they return to their 52-week highs appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino 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 Cochlear. The Motley Fool Australia has recommended Cochlear. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It was a torrid end to a horrid week of trading for the S&P/ASX 200 Index (ASX: XJO) and many ASX shares this Friday.

After three days of selling this week, today’s session made it a fourth, with the ASX 200 opening in red territory this morning and staying there all day. By the time trading wrapped up, the index had slumped another 0.89%, leaving the index at 8,741.2 points as we head into the weekend.

This rough end to the Australian trading week today comes after a tough night up on Wall Street.

The Dow Jones Industrial Average Index (DJX: .DJI) wasn’t playing ball, dropping 0.6%.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) fared similarly, falling 0.65%.

But let’s get back to the local markets now for a look at how the various ASX sectors ended their respective weeks.

Winners and losers

Unlike yesterday’s session, there were some sectors that escaped the selling this Friday.

But first, it was mining shares that were hit the hardest. The S&P/ASX 200 Materials Index (ASX: XMJ) had an awful time of it, plunging 3.68%.

Gold stocks were smashed too, with the All Ordinaries Gold Index (ASX: XGD) tanking by 2.69%.

Tech shares had another shocker. The S&P/ASX 200 Information Technology Index (ASX: XIJ) cratered by 2.05% today.

Healthcare stocks weren’t exempt either, evident from the S&P/ASX 200 Healthcare Index (ASX: XHJ)’s 1.24% dive.

Real estate investment trusts (REITs) came next. The S&P/ASX 200 A-REIT Index (ASX: XPJ) was sent home 0.95% lower.

Consumer discretionary shares didn’t get much love, with the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) dipping 0.7%.

We could say the same for energy stocks. The S&P/ASX 200 Energy Index (ASX: XEJ) lost an early lead to close down 0.66%.

Our last losers this Friday were communications shares, illustrated by the S&P/ASX 200 Communication Services Index (ASX: XTJ)’s 0.08% slip.

Turning to the lucky green sectors now, it was financial stocks that held up the best. The S&P/ASX 200 Financials Index (ASX: XFJ) added a healthy 1.08% to its total this session.

Industrial shares were spared as well, with the S&P/ASX 200 Industrials Index (ASX: XNJ) lifting 0.24%.

Utilities stocks matched that gain. The S&P/ASX 200 Utilities Index (ASX: XUJ) also climbed 0.24%.

Finally, consumer staples shares proved to be a safe haven, as you can see by the S&P/ASX 200 Consumer Staples Index (ASX: XSJ)’s 0.04% uptick.

Top 10 ASX 200 shares countdown

Today’s best stock was insurer Insurance Australia Group Ltd (ASX: IAG). IAG shares bounced a decent 4.23% higher this session to close the week at $8.14 each.

This healthy jump came despite no obvious catalysts from the company itself.

Here’s the rest of today’s best:

ASX-listed company	Share price	Price change
Insurance Australia Group Ltd (ASX: IAG)	$8.14	4.23%
Suncorp Group Ltd (ASX: SUN)	$19.61	3.65%
AUB Group Ltd (ASX: AUB)	$27.90	3.33%
Ingenia Communities Group Ltd (ASX: INA)	$3.97	3.12%
Challenger Ltd (ASX: CGF)	$10.23	2.92%
QBE Insurance Group Ltd (ASX: QBE)	$22.68	2.86%
National Australia Bank Ltd (ASX: NAB)	$38.72	2.65%
Viva Energy Group Ltd (ASX: VEA)	$3.04	2.36%
Brambles Ltd (ASX: BXB)	$18.65	2.08%
ANZ Group Holdings Ltd (ASX: ANZ)	$37.27	1.69%

Enjoy the weekend!

Our top 10 shares countdown is a recurring end-of-day summary that shows which companies made big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen 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 recommended Aub Group and Challenger. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.