1. How much money will I need for retirement and where will I get it?

By saving for retirement this will enable you to be financially prepared for your future. There has been lots of research done about how much will you need for retirement. Industry figures show that individuals would need an annual budget of $43,317 and couples an annual budget of $60,977 to fund a comfortable lifestyle. These figures become helpful when thinking of retirement planning strategies. Think about how you want to live your life in retirement and add up any potential income source which could include Superannuation, investments, government entitlements, savings and or an expected inheritance.  

 

2. How and when will I access my super?

Your superannuation can make a big difference in your retirement planning so it is highly recommended that you have an idea when you can and will access your super. Generally, you can start accessing your super once you reach your preservation age, which will be between the age of 55 and 60 depending on the year you were born. Super is typically accessible from the age of 60 as tax free and you will have few options as for what you do with it. 

If you decide to keep working full time, part time or occasionally and still want financial stability you could access a portion of your super balance via a transition to retirement pension (TTR).

Alternatively, if you want to retire you can chose to take your super as a lump sum or move it into an account based pension or annuity if you wanted a regular income stream. There will be a different tax implementations for different people, and your super doesn’t guarantee an income for life so it can be valuable to seek professional advice on superannuation. 

 

3. Do I have to retire by a certain age?

The retirement age in Australia isn’t set in stone. You have the option to retire anytime you want. Given this situation, your health, financial situation employment opportunities, superannuation plans and balance and accessibility and partner’s needs could play a big part in this. 

 

4. Will I be entering retirement debt-free?

An AMP.NATSEM report found nearly four in five people aged 50 to 65 have household debt. When you plan retirement, you may want to consider if you’ll be carrying debt into retirement and think of ways to reduce that debt sooner rather than later. 

We recommend considering the following techniques to help reduce debt or having a better control of it:

  • Shop around for providers with lower interest and no annual fees.
  • Look whether you can afford to make extra repayments.
  • Pay your debts on time to avoid extra charges.
  • Look at whether it could be beneficial to roll your debts into one. 
  • Do a comparison of what you earn, owe and spend and try to work out a budget you can follow. 

 

5. Will I relocate or downsize?

Your health, activities, partner, family, and the lifestyle you want to have once you stop working play the biggest role of whether you need to downsize or relocate. Therefore, it is really not just your financial position. 

If you are thinking of downsizing to release money from your property, planning ahead can help project any out of pocket expenses or expected revenue or cash soy you can feel more comfortable in taking control of how your retirement will be going to look like. 

 

6. Do I have other matters that need addressing?

Insurance - you might already have insurance in place but it’s worth checking of it meets your needs and your current situation. During the working period, your insurance needs could be different to when you retire and thus the need to seek a professional advice in this regard. 

Investment Preference – Investments play a major part in many of retirement strategies, when you are retiring its worth reviewing your investment strategies and style and make any required alterations. In retirement, you might consider taking a more conservative approach as when you are younger you generally have more time to ride out market highs and lows. 

Estate Planning – have you thought about your estate planning needs and documented how you want your assets to be distributed after you are gone or how you want to be looked after if you can’t make decisions later in life?

Important Information:

Any advice in this article is provided by Linked Financial Services Pty Ltd ABN 27 164 559 951 and is general in nature only. It does not consider your personal goals, financial situation or needs. It is important that you consider the appropriateness of any advice and the relevant product disclosure statement or terms and conditions before deciding what’s right for you. You can read our Financial Services Guide online for information about our services, including the fees and other benefits that Linked Financial Services Pty Ltd and their representatives may receive in relation to products and services it provides.