retirement planning

How Big Is Your Retirement Gap And How Do You Close It Before It’s Too Late?

You’ve got dreams of doing what you want when you want in retirement…

Retiring the 9-5, five days a week…

No more alarm clock. Wake up when you want…

Pursue all the interests you never had time for while working…

Time to start ticking off the bucket list destinations…

Finally join the Grey Nomad train…

But there’s one MAJOR problem.

How much money do you need to make it a reality?


Are you on TRACK to fund the retirement you dream of without running out of money?

How big is your retirement GAP?

The difference between what you have and what you need…

After two decades advising clients with this major and very important transition. I’m surprised how many people don’t take it seriously. Or wait too long…

​​Most underestimate the GAP
between what they think they need and what they actually need to live a comfortable retirement.

This is a MAJOR issue and to be quite honest, most don’t take it seriously enough…

Thinking a rabbit’s going to magically appear out of a hat and solve all their problems.

If you don’t get your numbers right from the start, this does not end well…

Is your retirement GAP $250,000…


…$1,000,000 or more…

Introducing Garry and Cindy…

Garry and Cindy were ticking along thinking they were travelling well. Planned to retire in roughly 7 years time.

Having saved hard. There was one nagging question they just couldn’t answer. How much money did they need to fund their retirement? One filled with many adventures.

Now empty nesters. They were earning good money (both on six figure incomes) with a good amount of excess cashflow.

Wanting to be mortgage free. Seriously thinking about whether they were positioned to retire in 7 years time.

Having made some crappy investment decisions (their words). They didn’t want to make any more at this crucial time.

Like most people approaching retirement they had a number of concerns.

They were keen to make the most of their retirement years. But weren’t sure what numbers they needed to hit to make their dream retirement lifestyle a reality.

Not wanting to make any further mistakes at this critical time. Maximising opportunities and not losing any money over the next 7 years were front of mind.

They were confused and keen to find out the answers before it was too late.

Garry and Cindy downloaded our book, ENOUGH and reached out for our guidance.

What did Garry and Cindy want out of retirement?

Prior to sitting down and working through their numbers. We wanted to gain an understanding of what they wanted from retirement.

Both liked travelling internationally. Planning for at least 5 international trips once they were retired.

Given they were working in high pressure jobs. A more relaxed lifestyle was important to them both.

Given both had moved for work. They wanted somewhere more relaxing to live, something coastal.

Both wanted to use their time to maintain and improve their health. Spending time with family, volunteering and learning new skills were at the top of their list.

And ofcourse joining the grey nomad train around the country was something they were looking forward to.

Besides living a great lifestyle, they wanted to be debt free by the time they retired…

There was one thing they didn’t want…

They didn’t want to run out of money in retirement. Nor did they want to compromise their dream retirement lifestyle.

Will you run out of money in retirement?

How BIG was Garry and Cindy’s retirement GAP?

Now we had a good handle on the lifestyle they wanted to live in retirement. We could now focus on their numbers.

The financial numbers they needed to hit to make it all reality…

Without the worry of running out of money.

Garry and Cindy were adamant they didn’t live a lavish lifestyle and believed they could live on $50,000 pa. After the mortgage was paid off.

Knowing that investment returns will likely be lower in years to come. We used conservative return assumptions to work out a capital amount.

They would need approximately $1,299,100 to fund their $50,000 pa retirement income until age 100.

Now, you might think you will not live till the right old age of 100. Life expectancy is one factor of retirement many underestimate.

Unless you have health issues, the probability of one in the couple making it into their 90’s is pretty high.

Adding to their retirement number was at least 5 international holidays at an estimated cost of $20k each. Totalling $100k.

Garry and Cindy needed approximately $1.4m to make their retirement dreams a reality.

After taking into account what they currently had, less their mortgage, their retirement funding GAP was $541,681.

Do you know how big your retirement GAP is?

If not, you need to know before it’s too late…

Once you know, you have the information to make meaningful decisions that will impact your retirement lifestyle.

How did Garry and Cindy’s finances fair…

An important aspect of retirement planning is understanding your current GAPS. The ones you can’t see. We call this step a financial x-ray.

We start this process with cashflow forecasting to identify potential GAPS that exist now and ones that may appear in the future.

Here’s what we uncovered for Garry & Cindy…

  1. They had a reasonable retirement GAP to make up, but in their favour were their plans to work for another 7 years and a healthy level of excess cashflow.
  2. Cindy had not been taking full advantage of her ability to contribute to super. Left unaddressed, there would be less money when they retired.
  3. Garry and Cindy had no plan for bridging their retirement GAP. In fact when we met them it was a hope and prey strategy that was not well thought out.
  4. War Chest – given the uncertainty in investment markets and when returns are generated, there was no plan around how to safely fund their retirement income. Without realising losses when share markets are down.
  5. Investment risk – they were in high risk investments within their super fund. This was a hidden risk they were unaware of. Unaddressed, there was a risk it would blow up their retirement plan when they least expected it. We determined they did not need to take the level of risk they were currently taking.
  6. Investment Preferences – after completing an investment preferences exercise. How they were currently invested was not in alignment with how they wanted to be invested.
  7. Tip to the tax office – we identified there was a potential tax liability in the multiple six figures may end being paid to the tax office if unaddressed.

What GAPS are you unaware that could potentially impact your retirement lifestyle?

How was Garry & Cindy going to close their retirement GAP?

After uncovering their retirement GAP. Along with hidden gaps they were unaware of. We were able to start crafting their roadmap to make their retirement a reality.

  1. With substantial excess cashflow we needed to look at how best to ultilise this over the coming years to close their GAP. While making sure they did not lose any money along the journey.
  2. Increasing Cindy’s super contributions was first on the list.
  3. With interest rates low and unable to pay large chunks off the mortgage due to it being fixed. We directed excess cashflow into their super.
  4. It was important that they be careful which super fund these contributions go into. We needed to keep the personal contributions (ones they were not claiming tax deductions on) separate from other contributions. Given their balances, once they retire we’d implement a strategy to convert taxable components (contributions where tax has been paid on) into non-taxable components. This would ultimately reduce or eliminate the large tip to the tax office.
  5. Based on their long term cashflow forecast we’d determined they did not need to take the excessive risk they had been taken. They could, if they wish, take less investment risk and comfortably achieve their retirement dreams.
  6. Arranging their investments which were more in line with how they wanted to invest.
  7. A strategy to build a “War Chest” to provide a buffer for them to fund their retirement income when share markets fall. Without being a forced seller and costing them money in the long term.

You can’t win retirement…

Here’s the thing, no matter what you do, you won’t be able to figure everything out. There’s too much uncertainty for that.

But that doesn’t mean you won’t be okay…

What you need is a framework to work through your decisions in a methodical way. This way you’ll still be able to enjoy all that retirement offers.

Not everything will work out the way you expect it too. It rarely does…

There’ll be versions 1.0, 2.0, 3.0 and many more of you.

But if you work through your decisions in a methodical and intentional manner, you’ll continually improve. While being able to course correct along your journey.

What about uncertainty?

It’s a fact, we don’t know what’s going to happen in the future…

Long term planning is hard to predict. If you use a retirement calculator, you will not experience that outcome.

You can analyse your future spending for the next 10, 20 or 30 years and long term investment returns, but neither will improve your precision.


You don’t know what your spending is going to be in 10 years time, nor do you know what your investment returns will be.

This does not mean you can’t make good decisions on your future lifestyle.

No matter what you do, you will never remove uncertainty from your retirement planning. It’s going to be there at every turn through your retirement journey.

However, managing uncertainty is at the core of retirement planning. When you create your retirement plan, make reasonable assumptions.

A well constructed, thought out, resilient plan will see you through your comfortable retirement…

Once you figure out what your comfortable retirement lifestyle will be made up of. You can then get to work by crafting a feasible retirement plan.

This gives you options by making your retirement plan resilient. You can then use prudent assumptions to plan for the short term and course correct when you need to.

Crafting a retirement plan that is resilient creates slack or built-in shock absorbers which allows you to change as the future becomes more clearer.

You will not be able to eliminate uncertainty, but if you have a well constructed, thought out and resilient plan. You’ll be able to manage uncertainty and gain confidence in making your comfortable retirement lifestyle a reality.

Just like Garry and Cindy. We used very conservative assumptions along with putting in place levers and shock absorbers to help assist with an uncertain future.

Do you have a written, well thought out and resilient retirement plan?

Everyday you don’t have a plan is less money you’ll have at retirement. Not only that, you may be forced to work longer than you had expected.

Even worse, you might work longer than you needed to. When you could have been enjoying more time freedom. Had you’d known earlier.

For Garry and Cindy, they’d be able to comfortably retire in 7 years time. Even better, they were in a position that if they followed their roadmap. They’d be able to retire in 5 years.

We spoke with Garry and Cindy recently. They had decided based on the work we’d done together, they were planning on starting their retirement journey 2 years earlier.

What a awesome outcome for Garry and Cindy…

Do you know how much money you need to live a good lifestyle in retirement without running out of money?

Not based on a whim, but based on a well thought out plan that takes into account the ebbs and flows of your spending in retirement? One that will see you though the ups and downs you’ll experience along your retirement journey?

Do you even have a plan to achieve your comfortable retirement?

Everyday you don’t have a plan is less money you’ll have at retirement.

Don’t be that person…

Book your Retirement Clarity Call below where we’ll provide clarity and identify the next steps you need to take to secure your dream retirement.  Without fear of running out of money…

Glenn Doherty – CFP – Financial Planner | Helping people within 10 years of retirement achieve a successful retirement

We work with people in Adelaide and around Australia via virtual meetings!

Request a Retirement Clarity Call

An opportunity to talk through some of your challenges and questions you have around your retirement.

Achieve some clarity and maybe a roadmap on how you can achieve a comfortable retirement.

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Advice Disclaimer: Any reference in this publication to the provision of advice refers to advice of a generic nature, and should not be taken as product or investment recommendations. Before any action is taken based on the information provided, independent financial advice from a licensed financial adviser should be sought. Financial Freedom Project Pty Ltd ATF GA & DC Doherty Family Trust Trading as Jigsaw Private Wealth is a Corporate Authorised Representative of Exelsuper Advice Pty Ltd. The information contained in this publication is of a factual nature only and is not intended to constitute financial product advice. Information is current as at date of publication. This is an online information blog. It does not imply an offering of securities.

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