Studies show that most people spend more time planning the next holiday than ever spent on preparing for retirement – but it is not hard at all!
Consider if you are a –
- Woman and want to retire at the age of 65, then you need to plan to be living the life of a retired lady for, on average, nearly 22 years – possibly as long as your time in the workforce, or time spent rearing children
- Man, life expectancy is closer to 20 years at age 65. (Sourced from AIHW)
5 Steps to Plan for Retirement
- Where you are – what you own, what debts to repay – home loan credit cards, car loans, what you can save (and put extra into super instead of all savings taxed at top marginal rate)
- Want to have – The vision – What type of lifestyle do you want in retirement? An overseas holiday every 5 years, regular local holidays, to dine out, to run mobile phone and internet…
- What it will cost – rule of thumb is that you are likely to require between 60 and 80 per cent of your pre-retirement income to lead the active life that you’re probably expecting in retirement. But you can also calculate your cost of living – simply record and categorise all your spending for 2 months – total food, fuel, dinners out, movies, presents/gifts, insurances (monthly or use the annual amount divide by 12) etc
- What you need – Using the ASFA examples of cost of living, assuming you own your own home, cost could be over $44,000 a year (or just over $60,000 per couple) for a comfortable lifestyle
- What to do NOW – Calculate where/how that money will be derived – (Centrelink will assess your assets and income). Or plan to have enough invested and saved. – For $45,000 at a conservative 5% return you require $900,000, in assets that return $45,000 eg rental with 5% NET return after expenses.
My 5 Actions to take in the next 5 weeks
What are your thoughts? Start or continue the conversation here!
Got questions? If you want experts who have years of helping others, without the hype –
then call for a FREE strategy session today
No obligation ~ call 0407 361 596, Paul