One of the most significant financial objectives you will ever have during your life is successful retirement financial planning for your golden years. It is essential to begin planning early.

There are key things to consider when planning for retirement, such as your retirement income, expenses, and retirement nest egg.

Some of us daydream about the moment when we won’t have to work and will have plenty of time to complete all the things we’ve put off. The ability to pursue hobbies, relocate for a sea-change or tree-change, go on long trips without having to rush back to work, or spend time with grandkids.

Whether you’re eager as a bee or in denial, starting your preparations as soon as possible can increase your chances of making your retirement years a success. 

Which type of retirement lifestyle are you interested in? Think about the location and type of home you want. You could decide that you want to travel overseas every year or that you want to buy a van and tour Australia while you’re still in good health.

If your goals and expectations for your retirement lifestyle alter, it is best to plan a new course before it is too late to make the according changes to your retirement financial planning.

What Will It Cost?

Assuming you own your own home and are mortgage-free at retirement, the general guidelines are that you would typically require between 66% and 80% of your pre-retirement income to maintain your quality of living after retiring. Because you won’t have to worry about tax, mortgage payments, or personal super contributions, living in retirement is typically less expensive.

For thorough budgets for various families and living requirements, visit the ASFA Retirement Standard.¹ This is a fantastic start when defining your budget and retirement needs. The budgets are frequently revised and are based on you owning your home.

Compared to a projected $28,775 for individuals around the age of 67, couples need $41,446 per year to sustain a minimum quality of life, according to ASFA. A comfortable lifestyle would cost around $45,239 for a single person and $63,799 for a couple per year.² 

Some people may be aiming for a retirement lifestyle that is more than comfortable, mainly if they were used to a pre-retirement income that was far higher than those stated.

In contrast, the current basic age pension is $23,420.80 for single people and $35,308.00 for couples per year.³ As you can see, this is not enough to support even ASFA’s modest budget, much less a respectable standard of living – especially for retirees who must continue to make mortgage or rent payments.

What Is Necessary To Fulfill The Dream?

Although everyone will have different income needs in retirement, taking into account your anticipated weekly, monthly and annual expenses may help, e.g. more may be spent on health care, insurance, home improvements, clothing, dining out, entertainment, and vacation with a comfortable budget.

Once you identify your forecasted expenses, you can then understand how to calculate your required retirement income and the necessary assets needed to fund this income. It would help if you thought about how long your money will take to get there. This is not an easy task because none of us knows our future lifespans. For retirement planning in Australia, you can also consult with an experienced Financial Adviser who can do all of this for you. 

Start Your Retirement Financial Planning Journey Today! 

When it comes to retirement financial planning, there are several factors to take into account. The most crucial thing is to begin saving as soon as you can, using the best strategy and right investment vehicle for you. Finding the best approach to help you achieve your goals requires guidance from a professional financial adviser.

The financial advisers at Coastal Advice Group serve clients throughout various phases of life, including young professionals, retirees, and aged care. We have offices located in Newcastle, the Central Coast, Sydney, Port Macquarie, and Byron Bay. Call or book online to secure your complimentary first appointment with us today and get started!

REFERENCES:

1. https://www.superannuation.asn.au/ArticleDocuments/269/2207-ASFA_Retirement_Standard_Budgets_March_2022_quarterV1.pdf.aspx?Embed=Y
2. https://www.superannuation.asn.au/ArticleDocuments/269/2207-ASFA_Retirement_Standard_Budgets_March_2022_quarterV1.pdf.aspx?Embed=Y
3. https://www.servicesaustralia.gov.au/how-much-age-pension-you-can-get?context=22526

DISCLAIMER: The views expressed in this publication are so12lely 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.