Retirement: You’ve probably thought about it. With the fact that you continue to age as the years go by, the question is: how do you prepare for it? Also, who has time to read through and understand the overwhelming amount of information out there? And yet, despite your confusion, you know that investing for retirement is a crucial tool to grow your nest egg.
Before you begin saving up for retirement, there are a few things you need to know.
Patience is Key
Timing is vital in retirement, especially when accumulating your superannuation fund. You have years ahead of you to top up your super, and you can stay invested despite market fluctuations.
Still, be mindful of the few years before and after retirement, also known as the retirement risk zone. It is the period when you have more to lose when there are falls in the share market for your investments. This time, your super has likely reached its peak in value. Therefore, you want to make the most of your savings for your future retirement.
Early Planning is Crucial
If you want to live through your retirement years comfortably and hassle-free, you need to plan as early as now. Why? There’s a considerable risk of outliving your savings, especially since Australians’ life expectancy has grown over the years.
Failure to plan early may leave you with insufficient savings in the middle of your retirement. Even if the Age Pension could serve as a cushion you can fall on for support when your retirement savings run out; they may not be enough to maintain your lifestyle.
Additionally, you can also be left with limited funds and options for aged care should you need it. You give yourself your the luxury of choice in the future by planning early to secure your retirement and ensure you will always have enough throughout your golden years.
The Impact of Inflation
There’s good chance inflation will affect your income and savings. That’s why you need to be mindful of the investments you make and the risks that come with them.
Market fluctuations can put short-term and long-term investments in trouble; you only need to ensure that they are tolerable for you. Again, it requires proper planning and good financial advice from an expert to perform calculated moves to make the right investments for your retirement.
Diversify for Growth
A powerful way to implement sound investments for your retirement is to diversify them. Create a perfect balance between growth and defensive assets to limit or reduce the impact of investment risks.
Lifetime Annuity May Be Right
A lifetime annuity may give you peace of mind. All you need is to use a portion of your savings or super and invest these funds in a lifetime annuity meaning you can receive income payments for the rest of your life.
Speak to a Trusted Financial Planner
Make the correct investment move for your retirement today. Don’t forget to speak to a financial adviser to know the best investments for you.
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 which is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429.