Planning for retirement

Making retirement plans early will help ensure you enjoy the best retirement possible.

What are my retirement options?

Most of us look forward to retirement. It’s a chance to explore new horizons, do all the things we never had time for when we were raising a family or pursuing a career. Or it could be just a time to relax and enjoy life at a more leisurely pace.

In fact, retirement can be anything you wish it to be. That may mean hanging up your work boots for good. Or you may prefer to gradually ease yourself into retirement by dialling back your working week. It could even be a time to choose your own hours by shifting into a consulting role.

When would you like to retire?

You may have plans to retire at a certain age, by a set date or following a particular event.

However, for some of us, retirement could come around sooner than expected because of ill health, an inability to continue in a physical role or the need to care for a loved one. 

So, it pays to make plans for your retirement long before you’re ready to leave; you never know what lies around the corner.

Enjoying your retirement

Making retirement a truly ‘golden’ period of your life can hinge on making the most of your time. That doesn’t have to mean travelling the world on regular vacations. It can be as simple as joining local community groups, undertaking new studies to broaden your knowledge or spending more time with family and friends.

Talk to friends and family members for ideas on how they are spending time in retirement. Remember, these can be some of the most productive years you may ever have enjoyed.

Planning for a change in retirement

You may be thinking about a change of location or even moving overseas for your retirement. 

While this may be the dream of a lifetime, be sure to think through any major moves – and not just from a financial perspective. Friends and family are very important as we age and it may not be easy to make new connections outside of a familiar community.

If you’re set on the idea of relocating, it can be worth renting for a year or so to be sure the reality lives up to your expectations.

Working out the cost

No matter what your plans for retirement, the reality is it can involve something many people don’t have enough of – money. 

Making some plans in advance for how much income you’re likely to have in retirement and how much your preferred lifestyle will cost is a key step in relishing your senior years.  

A good starting point in planning retirement is determining your financial position. It’s a lot easier than it sounds. You may wish to start thinking about the value of your assets and liabilities.

Will the age pension be enough? Will you be comfortable with 'comfortable'?

Many Australians aspire to have at least a ‘comfortable’ retirement. But what kind of annual income will you need to enjoy ‘comfortable’ by your standards? And how much does that mean you'll need at retirement?

According to the ASFA Retirement Standard for the March 2021 quarter published by the Association of Superannuation Funds of Australia (ASFA), to enjoy a comfortable retirement, at age 65 singles at will need an annual income of $44,412. Couples at retirement will need an annual income of $62,828. These figures assume the retiree(s) own their own home and do not pay rent or make mortgage payments. 

By ASFA’s standards, a ‘comfortable’ retirement means you can go on one annual holiday in Australia, you can eat out regularly and afford bottled wine. See what else a comfortable retirement means. Looking at the list, you can see whether your definition of ‘comfortable’ matches with ASFA’s standards.

Planning to rely on the age pension could see your retirement dreams cut short. The pension is designed to support a very basic standard of living. 

Financial advice is a good investment

It makes good sense to speak with a financial adviser before you step down permanently from the workforce. Your adviser can suggest strategies to give your super savings a last minute boost as well as advising on investments to help maximise your retirement income.

Good advice is especially important if you plan to wind down your working hours leading up to retirement. Take a look at transition to retirement to learn more. Or head to stopping work to learn more about the next exciting stage in your retirement plans.

Next: Transition to retirement

Retirement solutions from BT

Explore our flexible solutions to manage your super savings into retirement.

Thinking about retirement, but not sure where to start? Get tips and information in our Planning for Retirement guide, to help you get started today.

A comfortable lifestyle means different things to different people. Use our calculator to work out what lifestyle you want in retirement. 

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This information is current as at 1 July 2021.

This information has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation and needs. 

This information provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such.

This Information may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be accurate at its issue date. It should not be considered a comprehensive statement on any matter nor relied upon as such. While such material is published with necessary permission, no company in the Westpac Group accepts responsibility for the accuracy or completeness of, or endorses any such material. Except where contrary to law, we intend by this notice to exclude liability for this material. 

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