The Ugly Truth About Retirement Planning In Australia…
Retirement is one the biggest and most important transitions you’ll ever go through. Sadly many are leaving themselves short when it comes to their retirement planning in Australia.
It’s your second chapter and if you don’t plan this well…well you don’t need me to tell you how it’s going to work out.
Planning for your retirement is complex and confusing. For many there are personal biases and myths holding them back from retiring in comfort.
Sadly too many are flying blind when it comes to their retirement planning. While many have good intentions, we see too many that aren’t taking it seriously enough.
We outline where we see most getting it wrong:
No clear retirement plan to follow…
It surprises me how many people we talk to who are about to enter their next chapter of life.
One that could potentially last 20, 30 years or more.
With no clear direction on how they are going to fund their retirement lifestyle. Let alone know how much they need or whether they will run out of money in retirement or not.
It’s interesting when the most important question pre-retirees are asking themselves is…
…How much money do I need to retire?
Yet they don’t have a retirement plan…
If they do, their assumptions on which that retirement plan is based are way off.
A good retirement is like a good map. Laying out a clear path and foundation for thinking through the financial decisions you need to make. In a methodical manner.
In simple terms, it’s the lifestyle you want to live in retirement…
How much is that retirement lifestyle going to cost?
How much money do you need to confidently see you through your twilight years?
Do you have a retirement GAP? If so, how BIG is your GAP? Maybe you don’t have a retirement GAP and can consider retiring earlier than you thought.
What investment strategy do you need to support your retirement income while avoiding bubbles?
What strategies and tactics do you need to implement?
Every day you don’t have a plan is less money you’ll have in retirement…
Want to start building a plan for your retirement so you can retire with confidence?
Book a Retirement Clarity Call here…
Underestimate how much they need to fund their retirement adventures…
The biggest risk pre-retirees face is arriving at retirement with less money than they need.
Now this is not going to be a problem if you live frugally and don’t have big plans. You have a little saved in super and combined with the aged pension you’ll survive. A ho-hum retirement…
Most people we speak to have BIG plans for retirement. Many years of being active.
Months every year exploring Australia in their caravan…
Travelling overseas on a regular basis…
Catching up with friends at a nice restaurant and enjoying a nice bottle of wine…
Helping their children and grandchildren out financially…
Taking up hobbies they never had time for when they were working…
…and many more.
If this is you. It’s likely you’re going to be funding your retirement with your own super, investments and not relying on the age pension.
If you want to be comfortable in retirement and not worry about running out of money. You’re going to need a reasonable sum of money.
Book a Retirement Clarity Call and we can help you work out how much you need.
You may want to read “How Much Is Enough For Your Retirement? Two Heavyweights Battle It Out…”
Leaving it too late…
I get it, your middle stages of life fly by.
Your focus is raising your family. Paying down the mortgage and before you know it, you’re in your 50’s and retirement is fast approaching.
It’s easy to get caught up in life and planning for your retirement gets put on the back burner.
After all, planning your retirement takes a BIG effort…
But are you leaving your run too late?
Will you have to work longer than you wanted too?
Sure, starting at any time is better than nothing…there’s always something you can do. It might not be ideal, but you can still do something.
You can’t change the past, but you can definitely change your future…
If you are serious about living life to the max before you’re too old to enjoy it. You need to start your retirement planning now…
Too often we see people who should have come to see us 5 years ago…
Imagine what could have been achieved if you’d started five years earlier.
Want to take one step forward in planning your retirement?
Book a Retirement Clarity Call here…
Defensive mindset…
Without a doubt the last few years have been some of the most difficult on record.
And when you feel uncertain about the future. We go into our shells. We act conservatively and this impacts the way we think about our investments.
Panic sets in and this is when most people make costly mistakes when it comes to their money and investments.
No one likes losing money…
As humans, we crave certainty…
Unfortunately, it’s nigh on impossible to achieve certainty when you are planning your retirement.
However, if you have a framework to think through your decisions as more information becomes available. You’ll have more confidence about the decisions you make.
You need your money to last 20, 30 years or more through your retirement years. You can’t afford to be too conservative.
One step we take with clients to reduce unnecessary risk. Is to assess the investment return they need to achieve to make their plan work.
Once you understand the return you need to achieve. You can use the weight of evidence to build your investment allocation around it.
Too many enter investments blindly with no logic or plan behind what they are doing and why…
Your investment strategy should primarily be designed to support your income in retirement.
Are you sure you have the right investment strategy to see you through retirement?
Personal bias blurring the road ahead…
We all have personal biases that impact our decisions on a daily basis.
Sadly, this can have a massive impact on how much money you have to enjoy your retirement years.
Only the other day we were walking a client through their retirement roadmap. We made a couple of recommendations to save them a reasonable amount of tax. While improving the amount of money they had in retirement.
The client said to me, “I hadn’t done that because we were worried about changes the government might make.”
While we never know what changes the government will make. In fact no one knows what the futures going to hold. You can only work with the rules you have in front of you.
In this case, the client’s personal bias was costing them a significant amount more in tax. While leaving them with less money in retirement.
What personal biases are holding you back from having more money in retirement?
Not working with a financial planner…
Working with a professional who specialises in retirement planning up to and through retirement can help you live life to the max. Without fear of running out of money.
They can help you bring your retirement vision to life.
Help you work through the decisions you need to make.
Calculate the cost of your retirement and how much money you will need to pay for your retirement lifestyle.
Work through potential scenarios that you might be considering.
They can help you build a customised retirement roadmap. Which will help feel good about your retirement.
A good financial planner will help put your life at the centre of all discussions.
Unlike many planners where their focus is on trying to sell you a product or investment service. Not help you live the best life possible with the money you have.
Not only that. They sit on your side of the table. Be your personal guide as you embark on this major transition. Helping you to navigate your retirement adventure in and ever changing landscape.
Imagine how it would feel knowing how much money you need? The exact steps you need to take to safely arrive at retirement. Knowing when you can retire with confidence whether you decide to stop working or not.
Confident that you will be able to live your comfortable retirement lifestyle. Do everything you want to do without fear of running out of money…
It all starts with a 30 minute Retirement Clarity Call here.
Where we’ll answer your retirement questions, give you clarity and maybe a roadmap on how you can secure your retirement with confidence.
Book your 30 minute Retirement Clarity Call on the calendar below…
P.S. This is not a call to sell you a product or investment. Simply a call to help you determine what you need to do to retire comfortably…
If this is you, book your Retirement Clarity call below and we’ll help you figure where you retirement plan needs fine tuning.
Glenn Doherty – CFP – Financial Planner | Retirement Planning Made Simple for aspiring grey nomads and avid travellers within 7 years of 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.
Schedule hereAdvice 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.