Hock Liaw* says that not having enough money is one of the biggest concerns Australians have about their retirement but if you’re feeling worried, the first step is to take stock of what you’ve got.
Credit: AndreyPopov
Painting a clear picture of your current position and where you want to be is the best way to begin.
If you haven’t started planning your retirement budget, the earlier you get started the more time you have to make any adjustments you may need to make.
The Association of Superannuation Funds of Australia (ASFA)’s budget guidelines can be a helpful starting point.
Every quarter, ASFA releases a Retirement Standard.
It benchmarks the annual budget needed by Australians to fund either a comfortable or modest standard of living in retirement. Their budgets assume that retirees own their own home outright and are relatively healthy.
According to the March 2018 results, a single Australian aged around 65 will need around $27,368 each year to support a modest lifestyle and $42,746 to support a comfortable one.
A modest retirement lifestyle is considered better than the Age Pension, but still only able to afford fairly basic activities.
A comfortable retirement lifestyle will enable you the freedom to enjoy a broader range of leisure and recreational activities and enjoy a higher standard of living.
ASFA’s figures are a helpful guideline but your lifestyle will almost certainly require a unique budget.
More Australians are looking for a flexible transition to retirement
Retirement doesn’t have to be about all or nothing.
If you’re not quite ready to retire but you’d like to start cutting back the number of hours you work, a transition to retirement strategy can be a great option.
The Australian Government introduced a policy called Transition To Retirement (TTR) in July 2005. It was originally introduced to encourage Australians to gradually reduce their working hours and remain in the workforce, rather than retire fully.
Two of the biggest benefits TTR can offer you include:
The ability to supplement your salary and maintain your current lifestyle
The possibility of saving tax and boosting your super before full retirement
Due to its highly flexible nature, TTR strategy can also be rather confusing to understand.
Seeking advice on how this policy could benefit you and your defined benefit super scheme is a good idea.
Take the next step
With the right help, planning for your retirement is easier than you think. For more expert tips, visit the StatePlus website at this PS News link.
* Hock Liaw is a registered financial adviser with StatePlus and can be contacted at [email protected]
The ASFA Retirement standard can be accessed at this PS News link.
StatePlus, formerly State Super Financial Services, is one of Australia’s leading providers of financial planning. Since 1990, our retirement experts have provided life changing financial advice to public sector employees and their families. With a StatePlus planner by your side, you can feel confident about reaching your financial goals to live the retirement you really want.
This article was published on the 24th of September. The information in this article is current at the time of writing the article. This is general information only and does not take into account your personal objectives, financial situation or needs. It is important to seek financial and taxation advice that takes into account your personal objectives, financial situation and needs before making any decisions based on this information.
