Repeated headlines warning that many Australians can't afford to retire can be depressing. But on the bright side, they do get us thinking about our own super and whether we’re on track to stop working when we want to.
1. When do you want to retire?
Although many of us have a rough idea of when we’ll be able to afford to retire, here are a few questions worth asking:
- have you paid off the mortgage?
- have the kids moved out?
- do you have other debts?
- do you have ageing family you need to care for?
- are you planning to take time out of the paid workforce?
These sorts of questions help determine how much longer you’ll need to work and whether you might consider easing into retirement via a transition to retirement strategy.
2. When can you access the Age Pension?
When you can access the Age Pension depends on when you were born. Factoring a full or part Age Pension into your retirement plans could impact when you retire. You might need to consider boosting your super so you can retire earlier or work longer so there's less time between your retirement and reaching Age Pension age.
3. What type of retirement lifestyle do you want?
Get a really clear picture of how and where you want to spend your retirement. This will help determine how much money you need, both as a lump sum and income.
Working out how much income you might need in retirement can be a challenge, but the Association of Superannuation Funds of Australia (ASFA) Retirement Standard can help. It benchmarks the annual budget needed by Australians to fund either a modest or comfortable standard of living in the post-work years.
MoneySmart's Retirement planner can also help.
4. Boost time
If you've reached your preservation age (the age you can access your super – see table below), you can also look into a transition to retirement strategy. This could allow you to reduce your work hours and top up your reduced salary with payments from your super, boost your super savings without cutting back on your lifestyle, and access your super.
5. How do you make it happen?
Get some advice as early as possible. At Tasplan, general advice on your Tasplan account is free of charge or, if you need some more detailed personal advice, we can refer you to a financial planner.
This article contains information or advice that is intended to be general in nature and which was prepared without taking into account your personal objectives, financial situation or needs. Because of that, before acting on any information or advice in this article, please consider whether it is appropriate to your personal circumstances, talk to a financial planner and consider the relevant Member guide, available at www.tasplan.com.au or by calling 1800 005 166, before making a decision about whether to acquire the products.
The trustee of Tasplan Super (ABN 14 602 032 302) is Tasplan Pty Ltd (ABN 13 009 563 062). AFSL 235391.