Creating a retirement plan involves taking a lot of different questions into consideration. But it’s always better to start planning early on rather than by the time it’s too late.
Many people are often surprised as their retirement starts to approach so quickly, so take the time to start thinking about it now.
Getting financial advice from a professional can be beneficial as they can guide you through the thinking and planning process.
A well-curated retirement plan should serve as an answer to the questions that you may have. If you’re unsure about what to ask yourself in the midst of planning, here are a few suggestions that can get you started:
1. Where Will I Live?
Some people imagine themselves relocating when they enter retirement whether that be for cost or lifestyle reasons. Try to decide where you will want to live in retirement as this can have a huge impact on your financial plan.
For retirees, property is likely often one of the biggest assets that you will have for your retirement. You have the option to sell your home and relocate or downsize. Alternatively, you may want to upgrade and live in your dream home during your retirement – keep in mind how this will affect your retirement budget.
2. How Will I Spend My Money and Time?
When you stop your daily 9-to-5, you may be surprised that you have so much free time on your hands.
Start gathering up ideas about how you want to spend your time and also your money. Most people try to get through their bucket list whether that includes travelling, renovating, or taking up hobbies that you’ve always wanted to try!
While it’s great to enjoy the luxuries in retirement, it’s also important to include your daily expenses as part of your retirement budget. Be sure to plan for aged care costs and everyday living expenses as well.
3. How Much Money Should I Have?
Before jumping the gun on where you’ll spend your money, it’s important to determine how much money you’re going to need to fulfil those retirement plans. You may like to speak with a financial advisor on a possible estimate that you can work towards.
<pull quote> While there is no one absolute number that applies to everyone, moneysmart.gov.au estimates that the lump sum needed to support a comfortable retirement lifestyle is $640,000 for a couple and $545,000 for a single person.
This takes into account the emergency funds that you may need, and the required cash to take care of yourself at the end of life.
4. Where Will My Savings Retirement Budget Come From?
Financial advisors will help guide you through the different processes from where your future budget will come from.
Most commonly, there’s the superannuation that you’ve accumulated throughout your years of spending, as well as the pension that you are entitled to from the Australian Government. Ideally, you should also have an account of your own savings.
5. Should I Get Other Income Sources?
This is completely up to you and your personal budget.
If you have grand retirement plans, you may need to investigate other income options such as an investment portfolio or giving your superannuation a pre-retirement boost.
Ready to Build Your Retirement Plan?
The first step to your retirement plan is answering these 5 questions. This will allow you to start the foundation of your retirement plan on the right foot.
Be practical in your answers as well so that you can come up with a great retirement plan to stick to. After all, you and your loved ones will benefit from your forward thinking.
If you’re retirement planning near the Gold Coast, consult Cambio Group. Our financial advisors will be ready to help you achieve your retirement goals.
Disclaimer: The information (including taxation) in this website does not consider your personal circumstances and is of a general nature only – unless otherwise stated. You should not act on the information provided without first obtaining professional advice specific to your circumstances.
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