Retirement Planning

Life is busy, and with so many competing demands it can be hard to find the time to focus on your long-term lifestyle goals and plan for a better retirement. Here are some questions to help you start saving for retirement:

  • What does a ‘comfortable’ retirement look like?
  • How much do you need to retire?
  • How can you boost your super?

It’s never too early or late to get started. No matter what your age or life stage, taking control of your super savings and investments will help you enjoy a more comfortable retirement.

What does a ‘comfortable’ retirement look like?

The Association of Superannuation Funds (ASFA) defines a ‘comfortable’ retirement as an annual income of $42,1581 for singles and $57,6652 for couples.

So what does the break-down look like?

A ‘comfortable’ income once you retire includes:

  • Communications such as a mobile phone and internet access
  • Private health insurance
  • Energy expenses, air-conditioning, home alarm and regular pest inspections
  • Clothing, cost of hairdressing and personal grooming
  • Recreation, such as sporting and social club memberships, sporting goods and dining out occasionally
  • Own and maintain a car.

You can see it does not cover home renovations, downsizing or a sea change. So starting to save for your retirement now makes sense if you want to do all the things you’ve dreamed of when you retire.

How much do you need to retire?

To get started, consider what kind of lifestyle you’d like to have when you stop working, including travel or home renovations. This will help you decide how much super you will need to retire and which investment options and strategies may help you achieve your goals.

Many people underestimate how much super they’ll need to retire. And with improved life expectancy, many will be spending much longer in retirement than past generations. This means you need to retire with more wealth to ensure your income stream lasts. The government Age Pension is designed to give you a basic income, but it’s unlikely to give you the financial freedom you want for the 20 or more years you’re likely to spend in retirement.

To work out how your super is tracking and how long it will last, consider talking to us and we will develop a comprehensive plan and strategies to boost your retirement savings and help you achieve your financial goals.

How can you boost your super?

Superannuation can be one of the most effective ways to maximise your retirement nest egg. There are a range of strategies you can consider to boost your super savings:

  • Consolidate your super into one account to reduce fees and ensure your savings are working hard for you
  • Find any lost super by visiting the ATO SuperSeeker website
  • Take advantage of salary sacrifice contributions while you are working, can be an easy way to top up your super while reducing your taxable income, as you don’t pay income tax on salary sacrifice contributions to super and they are instead taxed at a maximum of only 15%
  • Access potential tax concessions by transferring up to 85% of taxable contributions from the previous financial year over to the super account of your partner. You can split these contributions from your super every year as long as your spouse is under 65 and not retired
  • Receive a tax offset by making contributions to your spouse’s super, if they earn less than $13,800.

Talk to us about any super contributions you make, so they can ensure you don’t exceed the relevant government contribution caps. Additional tax applies to any contributions exceeding these caps.

Super isn’t the only way to ensure you access a regular income in retirement. You may be able to draw an income from other investments such as dividends from shares and distributions from managed funds, interest from cash savings, or rental income from an investment property.

The type of investments you make will depend on the level of risk you’re comfortable with at this stage of your life. We can help you work out an investment strategy that will grow your wealth and allow you to take advantage of potential tax benefits, so you can feel confident about your financial future.

Talk to a us so we can work out the best ways to help grow your wealth based on your risk profile and financial objectives.

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