Working out how much you will need to fulfil your dreams for a ‘comfortable’ retirement is something very unique and personal to you.
The Association of Superannuation Funds Australia (ASFA) released a report in June 2014 indicating that about $42,433 a year (for a single) and $58,128 a year (for a couple) would provide a ‘Comfortable’ standard of living in retirement. Is that comfortable to you? What does this means in terms of total retirement assets?
According to ASFA to achieve a Comfortable standard of living in retirement you could need about $510,000 as a couple, including the receipt of a part Aged Pension, to achieve this. So as part of your retirement planning you may wish to consider the following questions:
Retirement planning, at its simplest, is about successfully tailoring and managing your ‘wealth creation' and 'income and asset management’ plan to meet with your idea of a ‘comfortable’ standard of living in retirement.
Retirement planning is divided into two key areas:
The decisions you make on your journey to retirement will impact how well prepared you are going to be when you ultimately decide to leave the workforce.
Studies have indicated that only 53% of couples and 22% of singles are on track to achieve a comfortable retirement income.
What you may not realise is that retirement plans are not just about how much you have in ‘Superannuation’, although this is important. Other parts of your Financial Plan can be just as important if not more. Are you on track to repay your loans? Are you appropriately insured (Risk Management) should a serious event sideline you or your spouse earlier than expected? Are your other assets working to deliver the investment returns you need?
The key planning areas to quality ‘pre-retirement planning’ include:
Ensuring that your retirement goals are realistic and on track is vital and something that should not be left until the last minute. Even a ten year window can be too short a time to make up a Retirement Shortfall. Each financial decision you make, or put off, could significantly impact how comfortable you are in retirement.
The best course of action is to speak with us to review your current financial plans and goals to determine exactly where you currently are. Together we can then work together to make appropriate changes incrementally to get you back on track or to enhance the outcome for you. That will give you great comfort.
The concern around outliving your money (longevity risk) has been magnified by recent investment market events and continued uncertainty.
A 2009 and then 2010 review by the Federal Government both highlighted the issue that many Australians could outlive the retirement nest eggs. Therefore if your approaching retirement, or seriously concerned about how this may impact you in the future, pre-retirement planning is imperative to help to mitigate, or at least reduce, this risk.
If you are about to commence retirement or already in retirement, your additional funding options have now more than likely been exhausted. The focus therefore is about managing your financial position moving forward. This is termed ‘Longevity’.
Managing your financial position in retirement can be impacted by a number of key factors including:
You circumstances goals and ultimate idea of a 'comfortable’ retirement lifestyle is unique to you. Therefore so too are your requirement for financial advice and financial management in retirement.
To address your concerns about your retirement longevity and outliving your money is imperative to ask yourself the above questions and then contact us to discuss your answers.
RSM can offer you a personalised service to meet with all your financial planning needs. RSM has consultants around Australia specialised in the following areas:
RSM can offer you access to a team of highly skilled and experienced professionals whom can provide you with assistance and advice in regard to matters relating to your Untaxed Super Funds. Some of these include:
Personal Financial Advice Services is provided by RSM Financial Services Australia Pty Ltd (AFSL 238282)
Everyone’s circumstances are different and this website doesn’t take into account your personal circumstance, it is therefore important that you consider the above in light of your financial situation, needs and objects, and seek financial advice before implementing a strategy.
This article has been prepared by RSM Financial Services Australia Pty Ltd ABN 22 009 176 354, AFS Licence No. 238282.
As everyone's circumstances are different and this article doesn't take into account your personal situation, it is important that you consider the above in light of your financial situation, needs and objectives, and seek financial advice before implementing a strategy.
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