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Retirement 101: How to Use Your Retirement Savings

November 15, 2022 | Retirement Planning

Retirement savings can be a valuable tool for your future financial security when you are no longer working. But how do you use them once you’re retired? If you’re planning on retiring soon, it’s important to understand how to use your retirement savings.

Tips to Utilise Your Retirement Savings

Start Saving Early

The most important step when it comes to your retirement savings is to start saving for retirement early! By planning ahead and seeking professional retirement planning advice, you can have plenty of time to save up and help you avoid relying on Social Security alone. It’s never too late to start saving for retirement, but the earlier you start, the better.

Take Advantage of Your Entitlements

One of the wisest and most popular ways to use your retirement savings is to take advantage of any entitlements to supplement your savings as soon as your reach retirement. Many retirees are eligible for government benefits such as the Age Pension or Commonwealth Seniors Health Card. Be sure to research your eligibility and apply for any benefits you may be entitled to.

Create a Retirement Budget

Another important step in using your retirement savings is to create a retirement budget. This will help you figure out how much money you’ll need to live comfortably in retirement – this includes day-to-day expenses as well as ad hoc expenses such as travel or hobbies. It’s important to be realistic about your spending habits and make sure you have enough saved to cover your costs.

This Budget Planner from MoneySmart can help you get started,

Think About Your Future Needs

When you’re retired, you may not need as much money to live on as you did when you were working. However, you’ll still need to consider your future needs, such as health care and long-term care. It’s important to save enough money to cover these costs and set it aside in case of an emergency.

Diversify Your Assets

Diversification is a crucial investment strategy that can help you reduce risk and improve returns. When you diversify your investments, you spread your money across different asset classes, such as stocks, bonds and cash, as well as different options within an asset class.

Diversification is significant for retirement savings because it can help you weather market downturns. For example, if the share market crashes, you may lose money if all of your retirement savings are invested in shares. However, if you have a diversified portfolio, you may be able to offset some of your losses with gains in other asset classes.

Bonus Tip: Be Aware of the Limit on the Amount You Can Transfer

The amount of money you can transfer into a retirement account and still be tax-exempt is currently $1.7 million – this is known as the Transfer Balance Cap.

Make the Most Out of Your Retirement Savings with Coastal Advice Group

There are a few things to consider when using your retirement savings once you’re retired. It’s important to make sure you have a solid plan for how you’ll use your money, and to be mindful of the tax implications of your choices. By following these tips, you can make the most of your retirement savings and enjoy a comfortable retirement.

The best way to make the most out of your retirement savings is to start by understanding the different options available to you. Once you know what’s available, you can start making moves to ensure that you’re getting the most out of your savings.

If you want to enjoy retirement with peace of mind knowing there is a financial strategy to take care of the future, get started with retirement financial planning from our expert team at Coastal Advice Group. We have offices located in Newcastle, the Central Coast, Sydney, Port Macquarie, and Byron Bay. Call or book online to secure your first appointment with us today and get started!

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DISCLAIMER: The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group. They cannot be reproduced in any form without the express written consent of the author. This information (including taxation) is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice. Newcastle Financial Planning Group, Central Coast Financial Planning Group, Sydney Wealth Advisers, Coastal Advice Port Macquarie and Coastal Advice Ballina Byron are subsidiaries of Coastal Advice Group Pty Ltd which is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429.