It is an age old question facing many Australians - when do I need to start thinking about (and planning for) my retirement?
Unfortunately, when seeking the answer, many often find they have left their run too late.
Data from Mortgage Choice found more than 50% of Australians don’t actually give their retirement ‘serious thought’ until they are in their 50s.
By not planning for your retirement until your 50s, you don’t give yourself the best possible chance to live a financially comfortable retirement.
When planning for your retirement, the key is to start planning as early as possible.
From the time you get your first job and/or buy your first home, retirement planning should be on your agenda.
If you start exploring ways to fund your retirement from an early age, you’ll have more flexibility with your plans and will be able to create a path for your retirement that is truly tailored to your future wants and needs.
But what does planning for your retirement actually involve?
In the first instance, it is a good to have an idea of what you would like to do in your retirement.
Do you want to take an overseas holiday every year? Do you want to have paid your mortgage off in full? Depending on what you want to do in your retirement and what you want to have achieved by the time you get there, will ultimately dictate how much money you will need each year.
And, while no-one can predict how long they will live for, it is a common fact that people are living longer. As such, it is important to plan for a long retirement.
Knowing what expenses might crop up in retirement (health care, etc) can be difficult, which is why it pays to do your due diligence.
Mortgage Choice’s Retirement Income Calculator can give you a good idea of what your income in retirement will look like.
From there, it is a good idea to speak with a financial adviser. They can talk you through the best ways to maximise your money in your retirement and the strategies you will need to make your retirement goals a reality.
Your financial adviser will also be able to talk to you about your super. One thing many Australians don’t realise is that their employer funded super contributions are often not enough to fully fund their retirement.
Additional super contributions and other investment strategies are all things a financial adviser will discuss with you to ensure you are in the right economic position to comfortably fund your retirement.