1 - Understand the sort of lifestyle you’d like to lead
The ideal retirement lifestyle varies from person to person, and if you’re happy to speed time relaxing at home with the family rather than traveling the world, you’ll be able to live on less money than a retiree with more expensive goals. Either way, be realistic about the lifestyle you can afford.
2 - Set a retirement budget
Don’t underestimate living costs and the need to plan for them. Understand where your money will be going by drafting a retirement budget. It can show whether your nest egg will support your preferred lifestyle and help to identify areas where cutbacks can be made to keep your budget in the black.
3 - Build cash savings
Without a regular pay cheque coming in you’ll need a source of cash to live on. Aiming to have several months’ worth of household expenses stored in a high interest savings account provides a pool of funds to meet regular bills and manage unexpected costs.
4 - Check age pension entitlements
The age pension doesn’t just provide additional income. If you qualify for even a small part-pension, you may be eligible for discounts on other expenses like public transport. Once you turn 60, you may be eligible for a
Senior’s Card, letting you access discounts across a variety of goods and services.
5 - Investigate ways to use your super
Your super savings are designed to fund your retirement, and your nest egg can be accessed in a variety of ways when you hang up your work boots. It’s important to make the right choice for your needs, and expert financial advice can help you understand the options available to use your super.
6 - Crunch the numbers
Your super fund is likely to have an online retirement calculator that shows how long your nest egg may last. Play around with a few key numbers like your retirement date, possible investments returns and your likely living costs to gauge the impact on your nest egg.
7 - Don’t overlook your health and wellbeing
It’s easy to focus on the financial side of retirement but it also pays to plan for important personal needs such as social and mental stimulation once you leave the workforce. Don’t just assume it’ll all work out. Think about how you can make retirement as fulfilling as possible.
With good planning, retirement can be one of the most rewarding and exciting stages of your life.
This article is prepared based on general information. It does not take into account individual financial objectives or needs and is not financial product advice.