Looking forward to retirement? Check out our top 10 tips for retirement planning to make sure you’re on track.
Tip 1: Take stock
How do you want to live in retirement? Now do the numbers. How much will it cost? How much have you saved? Do the figures meet your expectations? If not, what action do you need to take now?
Tip 2: Plan for the rest of your life
Most people are retired longer than they expect. While your health and family longevity will influence your life span, if you’ve survived life’s early risks, such as accidents or illnesses, you could easily live into your nineties or older. Plan for the long term, and don’t forget that you may need extra assistance or care as you get older.
Tip 3: Review your investments
For your savings to last the rest of your life, you need to invest for the long term. And that means getting the investment mix right, with a balance of income and capital growth. Diversifying your investments across cash, fixed interest, shares and property will help reduce risk and achieve smoother, more consistent returns over time.
Tip 4: Stick to your plan
Investments can quickly change in value. While it can be tempting to sell everything when the market falls and put all your money in cash, that’s often the worst thing you can do. It’s important to remain focused on the long term as the market usually recovers if given enough time.
Tip 5: Get the structure right
By changing the way you own investments and receive income, you may be able to reduce the amount of tax you pay while also increasing your Centrelink or DVA benefits. Even if you aren’t eligible for an Age Pension, you may be entitled to discounts and other benefits, which can save money over time.
Tip 6: Get your affairs in order
Estate planning allows you to pass on the right assets to the right people at the right time. The first step is putting a will in place, but you should also speak with your solicitor about an Enduring Power of Attorney and medical care directive. These can help your family fulfil your wishes if you’re not able to make decisions yourself. And remember to review your estate plan at least every three years.
Tip 7: Stay fit and healthy
If you stay mentally and physically active, you’re more likely to enjoy a long and healthy life. Take up a hobby, learn a new skill, keep working or volunteer in your community
Tip 8: Re-think the move
Some retirees have moved away from friends and family to their dream location only to realise it wasn’t what they hoped for. If the coast or bush is beckoning, try living there on a temporary basis first. It will give you time to work out if it’s the right move.
Tip 9: Think about the “what ifs”
The last thing you need in retirement is for your finances to be affected if something unexpected happens. Review your personal insurance needs to make sure you are fully protected. Don’t forget health and travel insurance cover, especially if you plan to join the grey nomads.
Tip 10: Get help
Making financial decisions can be complex. Getting the right advice can make a big difference to your retirement.