We need a minimum of $25,000 a year to live comfortably in retirement, according to market research by the Association of Superannuation Funds of Australia. Or $40,000 for a couple. That is in today's dollars and if you own your home. If you rent, the figures will be higher.

The important message from this research is that home ownership is desirable not only because it is a good long-term investment but because it reduces the income you need at retirement.

And if you don't have $25,000? The association says an income of less than $20,000 a year places severe constraints on a retiree's standard of living. These include limited meat in the diet, no frills, no clothes dryer or air-conditioner, no private-health insurance, no new clothes except to replace worn items, a struggle to maintain a car, $100 a year for grooming, only low-cost meals at local clubs, no restaurants, no alcohol and no money for holidays.

The association's preferred minimum income level of $25,000, and $40,000 for a couple, would enable a retiree to run a car, heat or cool their home and eat a varied diet, including seafood, have the occasional dinner in a restaurant, buy some books and attend some cultural events, have the occasional interstate holiday and allow regular trips to the hairdresser.

The ASFA research is impressive and detailed, starting with an analysis of what retirees spend. It is not the back-of-the-envelope figures often produced by other lobby groups. Nor is it based on telephone "surveys" conducted at 6pm when respondents say anything to end the call.

The research shows that retirees can live on significantly less than $25,000. If they own their homes they can survive on $12,563 a year ($16,061 if renting), while a modest but adequate annual budget has been calculated at $16,364 per single ($21,634 for a renter).

If retirees want to travel, particularly overseas, are avid opera or concert-goers, drink a lot of cappuccinos in cafes, or like to eat out at three-star restaurants a couple of times a week, the required income figure will escalate. It all boils down to lifestyle choice.

And that is where the financial advisers get their telephone-number figures for retirement; they assume that in retirement we will want to continue to live it up rather than adjusting down.

The retirement adequacy research, which has made its way into a Senate Superannuation Committee submission, is full of other interesting information.

For instance, the average super account is only $54,000, and the average age-retirement lump sum only slightly higher at $62,000.

Projections indicate that the average retirement lump sum will rise to $135,000 in 18 years and the 9 per cent compulsory superannuation contribution regime will deliver an average lump sum of between $180,000 and $200,000, well short of the $250,000 to $350,000 the association says retirees need.

Another interesting piece of information is that the full age pension over 20 years is worth about $200,000 in actuarial terms. But if you have $140,000 to $280,000 worth of means-tested assets, the means test is so complex and full of punitive benefit withdrawal rates that it is difficult to work out how much age pension, if any, you can rely on in retirement. So ensuring retirees have an effective complying pension or growth-pension arrangements rather than a lump sum will become increasingly important.

The association has several suggestions for increasing retirement lump sums, including making individual contributions of 5 per cent on top of the compulsory contribution of 9 per cent; simplification and reduction of taxes on super and incentives for middle-income earners to save more.

Many advisers suggest salary sacrifice to top up super. But before jumping into the salary-sacrifice option calculate how tax-effective it is because this strategy really only works for those on the top marginal-tax rate.

And before handing over a dollar of sacrificed salary find out whether the money goes straight into the fund as it is sacrificed or whether it is paid into the fund periodically.

At a recent superannuation conference, an industry fund trustee suggested some employers hang on to the salary-sacrifice contribution until the end of the year, then pay it into the fund as legislation requires. The result is that the employee makes do with a lower income, fails to get a year's earnings on the sacrificed amount and the employer can use it as cashflow.

The association also points out what we already know - that the assumption of the 40-year career is a myth.

According to a number of projections, in the 21st century the average male can expect to spend slightly more than 30 years in the workforce and the average woman about 20 years. And at least some of that time will be spent out of work.

That means fewer years at the grindstone but less time to accumulate the required retirement target, more time in retirement and more time requiring a retirement-income stream.

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