August 2024 Newsletter
Welcome to the latest edition of our Insights.
Retirement is always on the horizon – and planning for retirement is a crucial step in preparing for this stage of life.
In these Insights, we’ll discuss strategies for when retirement unexpectedly happens.
About two-thirds of Australians retire earlier than they anticipated because of unexpected events such as job loss or redundancy, they need to care for a family member, have a sudden illness or injury, problems at work or a partner’s decision to retire.i
Whatever the reason, an unexpected retirement can disrupt your plans and finances.
But, whether you’re in your 50s, 60s, or even beyond, it’s never too late to take meaningful steps toward a more secure and fulfilling retirement.
In fact, many people find themselves revisiting their retirement strategy later in life often after career changes or family shifts.
The good news is that with the right guidance and a few smart moves, you can still build a retirement plan that reflects your values, supports your lifestyle and gives you peace of mind.
Before you make any changes, it’s important to understand your current financial position. This includes:
Even if you’re starting later, there are ways to accelerate your super growth using:
These strategies can be especially powerful in your 50s and 60s, when your income may be higher and retirement is on the horizon.
If you have more than one super account, rolling them into one fund can reduce costs and be easier to manage. After all, multiple accounts mean multiple fees.
It’s also a good idea to regularly consider your super investment options and review your risk tolerance and time horizon.
If possible, getting your debt under control before you retire is a useful strategy.
You could consider using your superannuation or other savings or downsize your home to pay off a mortgage or other loans. But first, it’s essential to carefully check the tax impact, the effect on your super and whether any potential government benefits will be affected.
Retirement isn’t just about money, it’s about how you want to live. Ask yourself:
Clarifying your lifestyle goals helps shape your financial strategy. It also ensures your retirement plan reflects your values, not just your bank balance.
Aim to create a retirement budget. Estimate your future expenses including housing, food, travel and healthcare and compare them to your expected income. This helps identify any shortfalls and guides your savings strategy. You will also need to consider
the amount of time you might spend in retirement. This will depend on when you retire (planned or unexpected) and how long you live. This is called longevity risk. Given life expectancy is unpredictable, there is a possibility that your retirement savings may not last throughout retirement.
Resources to help calculate a retirement income include:
Many Australians are eligible for government support in retirement, including:
Even if you don’t qualify now, you may be able to restructure your finances to maximise future entitlements.
Retirement planning isn’t a one-time event. Life changes and so should your strategy. Regular reviews help you:
Flexibility is key. Whether you retire gradually, take a sabbatical, or pivot to a new venture, your plan should evolve with you.
Retirement planning is about taking the next step rather than chasing perfection. Whether you’re starting late or simply refining your strategy, every step you take now helps shape a more secure and meaningful future.
And remember that retirement isn’t an end point. It’s a new beginning even if you retire earlier than you anticipated. With the right plan in place, you can step into this next chapter with clarity, confidence and purpose.
We’d be happy to help you review your current retirement plan and identify any gaps in retirement goals and create a strategy should you need to retire earlier than expected.
ii Understanding concessional and non-concessional contributions | Australian Taxation Office
