Is preparing for retirement on your mind?
Clients often tell us that looking forward to their retirement is an interesting, challenging and exciting time. From experience in engaging with our clients about this topic we can affirm that the earlier they start preparing for retirement, the easier the transition can be – and the more promptly any financial anxieties can be addressed. Questions of health, use of time, pursuit of interests – and funding all of these can invoke excitement – as well as a level of anxiety.
This article provides some guidance for the preparation process, but we would love to hear from you if you have a story to tell regarding your preparation process: how you went about it; how you recorded your decision-making; and how you are progressing towards your ultimate goal. If you would like to share with us, we’ll acknowledge your effort in a way that we trust you will find rewarding.
A checklist of items to consider is offered below as a guide for those of you preparing for retirement.
Note: Before you settle on a retirement strategy, you need to ensure that you have identified and know, your needs!
Our ‘preparing for retirement’ checklist:
As financial planners, we work with many clients from different backgrounds and with different needs: the following checklist is a summary of the key items that our clients share that they have wrestled with before coming to us for planning advice.
Residence
Retain pre-retirement home
- For how long/ until what ‘trigger’ event
- Regular maintenance
Relocate
- Independent living
- Serviced accommodation
- Selling and acquisition costs involved
- Equity to be released/ assets absorbed
Capital costs
Home renovations/ comforts
- Improved facilities; timing
Vehicle replacement
- Timing
Health services
- Private health insurance
- Exercise and fitness
- Aged Care
Lifestyle/ Living costs
Home
- Insurance
- Rates (& other utilities)
- Property & Yard maintenance
- Ongoing debt servicing(?)
Groceries
Entertainment
- At home
- Away from home
Gifts
- Family & friends
- Christmas; Birthdays; special events
Transport
Clothing
Family support
- Generation subsidies (parents, siblings or children/ grandchildren)
Income/ Cashflow
- Self-funded income stream/ pension
- Asset sales
- Part-time employment
- Centrelink/ Commonwealth Seniors Health Card
…and now the timing, duration and funding parts of the preparing for retirement puzzle –
Armed with all of the above, it is time to consider other key issues that will effect how prepared you are to sit back, relax and commence a long and happy retirement: they include –
- When do you contemplate retiring? (how long have you got to address any accumulation needs?)
- Will you be able to access superannuation at that time? (will you have attained a preservation age, superannuation ‘condition of release’?)
- What is your ‘expected’ longevity? (how long is it expected you will be in your retirement phase: i.e.’ until you die?)
- Will you have accumulated adequate investment assets to retire? (do you know how much you will need as at retirement to fund the above goals?)
- How should your retirement funds be invested? (how can you minimise any risk to the preservation of your retirement capital?)
Personalised, professional advice on retirement planning is available
The advisers at Continuum Financial Planners Pty Ltd are experienced in providing ‘retirement ready’ advice, to assist you draw up your own checklist of costs, suggest how you might fund those costs – and from when and for how long. To meet with one of our team – who will listen to your needs, confirm they have a sound understanding of you and your requirements; and then will enable you to take peace of mind into the next big phase of your life, with personalised, professional retirement planning advice – call our office (on 07-34213456), or use the Contact Us facility on our website (where you can also check details About Continuum).
(Originally published in late 2012, this article was refreshed and re-posted, January 2015; and again in June 2016.)
