Are you doing all you can to reach a “Comfortable Retirement”
Through my years as a financial adviser I have helped many people of many ages to reach a diverse range of goals. However the most common financial goal that people come to me with is that they want a comfortable retirement.
Comfortable means different things to different people. ASFA (Association of Superannuation Funds of Australia) put our their guidelines on what they see as ‘comfortable’ in their Retirement Standard publication. Their website superguru has a very simple calculator so you can see how you are tracking.
|Total per year||$43,687||$61,909|
|Super Balance at Retirement||$545,000||$640,000|
But as we have previously touched on, on average individual retirees have accumulated about half the amount in their superannuation before retirement.
Inaction is your enemy!
The problem that I have as an adviser is that people seek advice just before retirement. At which time our ability to boost your retirement nest egg has diminished. Time is your greatest tool.
The sooner you have a goal, the sooner you can work towards it. It is never too soon to think about boosting your retirement savings.
Besides from your standard employer superannuation contributions, there are other ways to get funds into your account.
Its important to note that there are limits on how much money you can contribute to super in a year. It is important to seek financial advice before proceeding as there are financial penalties should you exceed them.
Salary Sacrifice : The most common ‘other’ way to contribute to superannuation whereby you have your employer add an additional percentage of your pre tax income to your super.
Downsizer contribution: A great incentive for 60+ empty-nesters downsize and utilise proceeds from the sale to contribute to super.
After Tax contribution: You can contribute post tax to your superannuation, possibly from your savings or an inheritance.
Spouse Contribution: If your spouse is not working or is a low income earner you may be able to contribute into their super and get a 18% tax offset.
Low income co contribution: If you are a low income and you contribute after tax money to your super, the government will match it up to $500.
Catchup contributions: From 2018/19, the government made changes so that you can utilise any unused pre-tax cap. This means any unused portion of your pre-tax cap can be rolled over and added to the next year, for a maximum of 5 years.
By planning early and using strategies aimed to boost your super, you put yourself in the best position to live retirement your way.
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- Association of Superfunds of Australia (nd) Retirement Standard [online] https://www.superannuation.asn.au/resources/retirement-standard
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. Louella Jorge is an Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429. This editorial does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information, you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser before you act.