In the first half of this article, we emphasised the importance of planning for your retirement and doing so at the earliest time possible. This is because a vital part of living a fruitful life for many people is to secure financial stability, retire comfortably, and make sure they leave a legacy with their loved ones in mind.
Today, we will continue to discover more tips to achieve a better retirement at any age in Australia.
More Tips to Retire Comfortably
6. Achieve and Maintain Self-Control
Many people will investigate whether to pursue a self-managed super fund (SMSF) at some in their lives. As of June 2017, the average age of an SMSF member was 58 years old, and there were over 1,100,000 SMSFs.
SMSFs can give you greater control over your retirement savings and allows you to invest in real estate and other assets, which is not possible with traditional superannuation funds. SMSFs are not suitable for everyone because they are subject to stringent regulations and involve significant responsibilities and investment of time.
Furthermore, SMSFs can be expensive to establish and run, but on the other hand, they can be cost-effective if you have a substantial superannuation balance.
7. Increase Your Super Balance Post-Retirement
Consider working on how to improve your superannuation balance before it’s too late.
From 1 July 2022, there is no work test when aged 67-74 for personal after-tax contributions which are capped at $110,000 per year.
If you have extra money to invest, such as money from the sale of a property or another asset, you can use the “bring forward” rule to make up to three years’ worth of non-concessional contributions in a single contribution. This rule is suitable if you have extra money to invest.
Also, the minimum age for the downsizer contribution has been lowered from 65 to 60, allowing eligible Australians to make a one-off contribution of up to $300,000 per person (or $600,000 per couple) when they sell their family home.
8. Keep the Future in Mind
When you reach retirement age, you have three choices for your superannuation balance. You have the option of taking the money in one lump sum, starting a pension, or keeping it in your superannuation account.
Because superannuation earnings are taxed at 15% and must be held for a long period of time, the majority of people’s wealth is typically invested in superannuation. It is advised that you reconsider your current investment strategy.
When you stop working, your ability to withstand short-term price volatility of higher-risk investments declines, despite the fact that higher-risk investments such as shares and real estate tend to appreciate over time. It may be time to restructure your portfolio with a greater weighting to lower-risk investments such as fixed-income securities.
9. Investigate Your Government Entitlements
When you retire, you may be eligible for government benefits such as the Age Pension, Pensioner Concession Card, Commonwealth Seniors Health Card or Seniors Card.
The amount of pension and types of benefits you’re entitled to generally depends on your age, assets and income with each offer tending to have different eligibility requirements.
Whilst you ideally don’t want to rely on government entitlements in retirement, eligibility for a Seniors Care or Health Card can result in substantial savings for expenses such as healthcare, car registration and utilities – which ends up being more dollars in your pocket!
10. Sort Out Your Estate Plan
Despite the fact that people are living longer lives than ever before, it is critical to plan for the future. A legal will is required to accomplish this.
Because your superannuation benefits are administered independently of your estate, it is critical that you keep your death benefit nominations up to date. With an enduring power of attorney, you can appoint a trustworthy individual to make decisions on your behalf if you become seriously ill or are unable to do so for any reason.
You Only Retire Once – Make Sure You Do It Right!
The retirement planning process can be difficult, making it easy to stall and shelve the plan. As such, seek the advice of an experienced financial adviser to support you to realise and reach your goals. With a professional on your side, you can ensure your family’s financial security and solidify your retirement plans so you can retire comfortably.
Do you need financial advice on the Central Coast? Central Coast Financial Planning Group is a team of financial advisers that can guide you through complex financial matters. Call us or book online to secure your complimentary first meeting with our advice team today!
DISCLAIMER: The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group. They cannot be reproduced in any form without the express written consent of the author. This information (including taxation) is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice. Newcastle Financial Planning Group, Central Coast Financial Planning Group, Sydney Wealth Advisers, Coastal Advice Port Macquarie and Coastal Advice Ballina Byron are subsidiaries of Coastal Advice Group Pty Ltd which is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429.