Rest easy with retirement planning in Warrnambool

Posted on 01/12/2015 by Adam Smith in Audit & Advisory
Adam Smith
Adam is a Sinclair Wilson Principal and the Managing Director of Sinclair Wilson Investment Services.  Adam is based in our Warrnambool office and provides technical advice on superannuation strategy and...

Early retirement planning is crucial for those wanting to position themselves for a comfortable lifestyle during retirement. Whereas those that leave retirement planning until retirement becomes imminent will likely find themselves with little scope to improve their lifestyle and may be forced to make a number of uncomfortable decisions, which may involve working longer or reducing their retirement income expectations.

Retirement planning is therefore essential if you want to live comfortably in your later years and have the ability to travel and enjoy a little luxury.

The most common factors influencing Australians on when to retire are personal health or physical abilities (40%), financial security (36%), and reaching the eligible age for an old age or service pension (15%).1

Some factors such as financial position at retirement, benefit from prudent retirement planning, others, such as your health are less predictable but are a risk which can also be hedged by early and prudent retirement planning.

Regardless of why or how you retire, there are a number of critical factors to consider during the retirement planning process:

  1. Will you have sufficient retirement savings to provide a comfortable income stream throughout retirement? The ASFA research on retirement living standards (March 2015), suggest that a couple now requires an income of$58,444 and a single person requires $42,569 each year to be “comfortable” in retirement.2 It’s important to consider how you would like to manage your lifestyle in retirement so as to ensure you will have sufficient retirement savings in place to support this. As part of your retirement planning your financial planner will consider your desired capital and income throughout retirement and look to provide suitable capital and income estimates, as well as help find strategies to boost your retirement savings in the lead-up to full retirement.
  2. Many individuals throughout Warrnambool and South West Victoria also choose to phase into their retirement rather than moving directly into full retirement. You may choose to phase into retirement because you are not ready for the sudden lifestyle change. It’s vital that you share this decision with your financial planner in order to ensure that appropriate strategies are in place to extract the best outcome from this change in your life. Your financial planner can build a transition to retirement strategy into your retirement plan that may lead to considerable tax savings in the long term, thereby increasing your retirement savings.
  3. There are also various Social Security entitlements available for those in retirement. Your financial planner will help navigate you through the complexities of social security legislation in order to maximise your entitlements throughout retirement.
  4. If you are self employed you may need to start thinking about your succession plan. Do you wish to hand over more responsibility to a family member? Or will you need to consider an external source to step in either as an investor or as an employee? It’s important to structure the best solution that will deliver the best result for your retirement plans.

Retirement planning in conjunction with your local financial planner in Warrnambool can help navigate you through life after work.

We all need to make plans to prepare ourselves for retirement sooner rather than later.

1 Source: Australian Business Statistics, Retirement and Retirement Intentions, Australia, August 2004 to June 2005
2 Source: www.superannuation.asn.au