As retirement looms it’s important to ramp up your planning – financial and otherwise.The following checklists are designed to remind you of some of the key things you should do at different stages on your road to retirement. As you’ll see, you may need to reassess some of the same questions at each stage because your needs, attitudes and situation may change as retirement gets closer.
– Think about the benefits of investing your super in growth assets like shares. They’re generally more volatile but you’ve got a long time to make up any falls and the potentially higher returns could mean you need to save less later in life.
– Rethink your mortgage. Many people make their mortgage their main priority and like to reach retirement debt-free. It may be more advantageous to invest more into your super and pay off the mortgage from super savings after retiring on or after age 60.
– If you’re part of a couple, there may be advantages to boosting the lower income earner’s savings rather than one partner having the bulk of savings. Having two different income streams also means you can ‘time’ your drawdowns to suit your needs.
– Many retirement savings plans flounder because the big bills – mortgages and school fees – compete with your super savings.
– Consider getting professional financial advice. Long-term planning is easier with someone to help you clarify what you want and invest more strategically.
– Remember the benefits of superannuation – a key element of this approach is generous tax concessions on super savings.
– Check your debt. Will you still be paying a mortgage in retirement?
– Think lifestyle. Ten years from now where do you want to live and how do you want to live? If you can visualise retirement, it’s easier to plan it.
– How much will retirement cost?
– Estimate what your retirement income will be. Your super fund can give you an idea of what your super will be worth when you retire. Find out from Centrelink whether you’ll be eligible for a pension. Or ask a financial planner to do some modelling for you.
– Think about timing. When do you want to stop work? Can you work part time? Do you and your partner want to retire at the same time? There can be advantages – social and financial – to easing gradually into retirement.
– Even at this early stage it’s important you understand your likely eligibility for the Age Pension and other benefits such as the Commonwealth Seniors Health Card. This will help you plan your retirement income more realistically.
Need help! Contact Avante Financial Services on 1300 788 650.
