I’ve just got off a zoom call with Dan & Julie. We discussed three potential paths their retirement path could take.
Dan & Julie, aged in their late 50’s, had plans to hit the open road in their caravan and explore the far reaches of Australia.
While they enjoyed their work, they wanted more time to enjoy life before they were too old to do so.
One thing was bugging them…
How much would they need and when could they make this dream a reality?
Like most people we speak to, they have done a phenomenal job building a solid financial base.
But struggling with the next steps and wanting the confidence they had everything in place.
We worked with Dan & Julie to work through three potential paths they could take.
A dream which they knew may not be reality.
We ran their numbers and worked out they could make this a reality.
It relied on access to age pension benefits to make it work.
However, it wouldn’t take a lot to blow up their plan. Not a great option…
Working longer but part time would allow them to still realise their dreams. They’d have the time to explore the far reaches of Australia in their caravan.
Putting them in a better financial position than full retirement.
Still there were risks to this plan. Relying on age pension benefits to kick in at a point in time and favorable investment conditions.
Should the government change the rules relating to age pension, their retirement would be turned on it’s head.
Even worse, if they experienced a run of bad investment markets, this could also turn their retirement on it’s head.
There was very little wriggle room in this path.
Full time work for the next 5 years…
Obviously the longer you work. The less you need to take from your nest egg. The longer you have to accumulate money.
For Dan and Julie, this provided the most workable solution.
They’d have enough money to see them through by being deliberate about the strategies they used over the next 5 years.
Our cashflow projections showed they’d still access age pension entitlements. Later than the above two options. But still enough to make a difference.
More importantly, they’d have substantially more wriggle room. Allowing them more flexibility if things didn’t go according to plan.
Lessons and insights…
Cash Flow projections will uncover hidden risks you are unaware of.
For Dan & Julie, they had taken a high level of risk with their investments.
Murphy’s law says the minute they retire, they’d experience market falls.
Knowing this we put in place a new investment strategy. One that would allow them to achieve an appropriate investment return. Minus the risk they were currently taking…
One that had a “war chest” of investments to cover their monthly income in the event a market downturn hit at the wrong time. Allowing them time to ride out any stormy market.
Knowing how their cash flow would pan out. Dan & Julie were able to take advantage of a number of super strategies to substantially increase their nest egg and pay less tax.
As they accumulated their nest egg there was a risk they’d be leaving a tip to the tax office should any of their super land in their estate. We created a plan to minimise if not reduce all of this.
Questions you need to ask…
- How much money do you need to comfortably retire?
- Are you on track?
- Have you tested possible scenarios?
- Is your cash flow flexible enough to manage through choppy markets?
- Have you included enough safety margin to manage changes in economic conditions?
- Do you have a roadmap which is agile enough to flex when your life changes?
- Are you taking advantage of all the strategies available to you?
- What is the minimum return you need to safely make it through retirement?
- What’s your plan when things go off track?
- Are you leaving a tip to the tax office on your way out the door?
And many more…
If you’re like Dan & Julie, and you’re having trouble with putting your own retirement roadmap together. Wanting to know what is possible and how to set it all up the right way.click here to request a Retirement Clarity call. I’ll share the same information that helped Dan & Julie gain confidence about their upcoming retirement…Maybe some insights and a roadmap on how you can get clear on your retirement options will help? If so,
Alternatively you can email me at email@example.com
Glenn Doherty – CFP – Financial Planner | Helping people within 10 years of retirement achieve a successful retirement