Is retirement on the horizon for you? Have you started to think about what that means? Here’s a checklist to help gather your thoughts.
As you enter the home stretch, the concept of retirement is slowly becoming more real. You’re starting to think more clearly about what sort of retirement you’d like.
Spring is a great time to start getting fit for your retirement future. Here are seven things to think about as you get your retirement plan into shape.
1. Invest with your head, not your heart
When you’re investing your retirement nest egg, it’s easy to react emotionally, rather than examine the evidence rationally. This can lead to making poor investment decisions, such as moving your money around at the wrong time or trying to chase returns.
By focusing on the three investment pillars—income, security and long-term growth—you can avoid making rash decisions.
2. Do it yourself
In the lead-up to retirement, many Australians are turning to self managed super funds (SMSF) to take more control over their super.
But SMSFs may not be for everyone. With more control comes more responsibility for compliance, investments and administration. Most SMSF owners find it pays to seek financial and taxation advice.
3. Make a smooth transition
Retirement used to represent a sharp break with the past. But these days, the transition doesn’t need to be so abrupt.
A transition to retirement strategy allows you to continue working and contributing towards your super, while starting to draw an income from your retirement nest egg.
4. Maximise your Age Pension
With all the focus on funding our own retirements, it’s easy to lose sight of the important role the Age Pension can play in boosting your retirement income.
With careful structuring of your finances, you can maximise your benefits and help your retirement savings last the distance.
5. Prepare for aged care
When we think about our retirement, we tend to focus on the early years. But there may come a time down the track when you need more help, whether it’s at home or at a residential care facility.
Careful planning can help you choose the right option when the time comes.
6. Plan your estate
A good estate plan will distribute your assets according to your wishes, protect your family’s interests and make sure your dependants are not hit with unexpected tax bills.
It will make sure the right funds end up in the right hands at the right time.
7. Crunch the numbers
Retirement isn’t just about the dollars and cents. It’s about health, wealth and happiness. It’s about generating an income, maintaining a healthy lifestyle and using the skills you’ve built up over a lifetime to develop new hobbies and help others.
But the numbers are a good place to start. How much have you saved and how much will you need to live on when you retire?
If you get the numbers right—if you plan and prepare well—you’re more likely to get the lifestyle you want. You can live the way you want, where you want, doing the things that you love—spending more time with the grandkids, exploring new countries, enjoying good food and wine with friends.
Doing your homework now can help you enjoy a better retirement down the track. Want to know more? Call us today to start the conversation.
What you need to know
Any advice contained in this article is of a general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regard to those matters. If you decide to purchase or vary a financial product, your financial planner, our practice, AMP Financial Planning Pty Ltd and other companies within the AMP group will receive fees and other benefits, which will be a dollar amount and/or a percentage of either the premium you pay or the value of your investments. You can ask us for more details.