You’re nearing retirement, you’ve passed the family business down to the kids and you’ve picked up the brand new Winnebago (or perhaps booked flights for a month in the south of France). However, there’s one big question running through the back of your mind – do I have enough superannuation to last through my retirement?
The short answer is that there isn’t one simple number that fits all, but fortunately, with some thought into a few of the different aspects of life (considering your life goals and objectives), it’s not too difficult to get an idea of how much will be enough!
What does your ideal lifestyle look like in retirement? Lifestyle is a personal decision. Luxury for some, might be modest for others. A comfortable lifestyle for one couple might require $60,000, whereas another couple may require $150,000 to live comfortably. Start by breaking down your desired lifestyle, thinking about the cost of everything from food and groceries, to travel, to the activities that you choose to undertake every day, week and month. By understanding the cost of your desired lifestyle, it makes understanding how much super you’ll actually require a whole lot easier!
How is your health? The average life expectancy for a 45 year old Australian today is 81 for males, and 85 for females, but it’s entirely possible that with a healthy lifestyle, you could live to 90 and beyond. We all know our health is critically important, so understanding the relationship between how healthy we are, and what our life expectancy might be, directly ties into the equation of identifying how much super you’ll need.
Your children have grown up, perhaps they’re in the process of taking over the family business. How much support do you want to provide your wider family? Do you aspire to help them with the mortgage, or possibly take the grandchildren on a cruise throughout the South Pacific? Consider the types of activities you’d like to be able to support the family with, as this directly impacts into how much super and savings you’ll need.
Supplementing Your Income
Finally, are you thinking about supplementing your savings with the Age Pension? The basic Age Pension represents just over $20,000 for a single person, and $33,000 for a couple. This is just 27% of the average Australian’s income, and your current investments, assets, and super balance may impact your Age Pension entitlement, so it’s worth getting some advice on how this impacts you.
If you’d like to have a chat about your retirement plans, your superannuation, and how long it will last for you, click here, or give the team a call on 07 4078 0900.
ClearWay Advice and Financial Management is a Corporate Authorised Representative Representative No.473095 of Keystone Partnership Pty Ltd ABN 22 169 650 720, Australian Financial Services License (AFSL) No.466137.