$100,000 in super deemed enough for retirement
$100,000 in super deemed enough for ‘comfortable’ lifestyle in retirement
This is the headline or click bait - the Today Show posted on their social media accounts this morning.
It worked.
The Today Show received over 200 comments on their Instagram post, and an additional 200 comments on their Facebook post.
This post was extremely misleading to the genuine research the Association of Superannuation Funds of Australia's Retirement Standard conducted, however as a financial planner I did not mind this misleading click bait, as it generated conversations and attention around retirement planning which as a financial planner beleive can only be a good thing.
Therefore, I tested this out on my own social media platforms to test the responses, before I provided the information and background to support those looking to plan their retirement.
According to the Association of Superannuation Funds of Australia's Retirement Standard, to have a 'comfortable' retirement, couples will need $690,000 for a retirement income of $69,691 p.a. Whereas, a single people will need $595,000 in retirement savings, to produce a retirement income of $49,462 p.a.
Whereas ASFA research suggests, that to have a 'modest' retirement, couples will need $100,000 for a retirement income of $45,106 p.a. Whereas, a single people will need $100,000 in retirement savings, to produce a retirement income of $31,323 p.a.
This also includes Age Pension entitlements that account for a large proportion of the income required.
Ultimately this is purely research and data to support you in understanding what you may require in your retirement.
Everyone has a unique view and different expectations of their own retirement.
This includes when you may consider reducing your working hours, working days, what age you stop work, whether you wish to travel domestically or internationally, whether you eat out each week, whether you wish to support your children and leave a legacy, or you might have a view on dying with zero dollars (spend your entire net worth).
Retirement planning is about putting the framework in place to enable you to get where you are today, to reach your retirement expectations, and have sufficient capital to meet your lifestyle needs into the foreseeable future.
Regardless of your age or situation, the choice is yours whether you wish to retire ‘modestly’ or ‘comfortably’. The following table provides a snapshot of where your superannuation should be based on your age
HOW MUCH DO I NEED TO RETIRE ON $100,000 A YEAR IN AUSTRALIA?
$1,185,000 in superannuation & other liquid assets,
if you are looking for your assets to diminish by your life expectancy age 85.
However, if you are looking for a retirement income of $100,000 a year to age 100,
you will require $1,340,000.
WHAT IF I DON’T THINK I HAVE ENOUGH?
Australians approaching retirement who fear they don’t have enough need to talk to a Financial Advisor who will understand your concerns. The next step is to consider the question: “If you want to go down this path, what’s the consequence?”
That means, if you’ve worked out you want to have $690,000in super but only have $300,000,
what steps will you either take to work longer, earn more or adjust your goals?
It’s about understanding the choices you have and being able to assess your situation & understand what I’m giving up by going down this path.
When we partner with our clients who are looking to retire, we reiterate that there are always options.
It’s great that you’ve noticed you’re approaching retirement and you’re starting to think about that.
Now we want to sit down and get into action mode, because there are so many strategies that are available to help you play catch up quicker than you might have thought.
That includes the option to downsize your home and put that profit into your super.
Also consider the role of Centrelink and concessional contributions in your plan.
Sit down with someone who knows these numbers … inside and out, and can map out your options so you can make an informed decision.
Have you heard the saying learn from your mistakes?
Many people believe you should learn from your mistakes.
Some people have different views of a mistake.
Many apply their filters, previous experiences and expectations to their mistakes, which provides an overwhelming feeling of failure.
Furthermore, they see mistakes as being problems rather than being stepping stones to finding solutions. In doing so, they avoid taking responsibility for their errors and therefore miss the chance to learn something new. This is taught early on it life, as society teaches us to feel guilty about failure and to do anything possible to avoid making mistakes.
However, there are some that see a mistake as an opportunity. An opportunity to learn. They review what went wrong, to understand and learn from your mistake. Identify the skills, knowledge, resources or tools that will keep you from repeating the error.
When it comes to making financial mistakes, they can have a significant impact on your financial future and can set you back years in achieving your goals.
What if you could learn from over 500 people’s financial mistakes?
Rather then waiting to make the financial mistakes yourself, setting yourself back years from achieving your goals and have to pick up the pieces to start again, there is an opportunity to learn from other peoples mistakes and set yourself up so you can make an informed decision.
Our Newcastle Financial Planning Advisors have helped, supported and advised hundreds of families that have made a plethora of financial mistakes.
Our financial planners provide an opportunity for you to learn from other people, so you do not have to make financial mistake to receive the lesson.
Especially coming into retirement, many do not have the time to make financial mistakes, as they only have one opportunity to retire and they wish to ensure they get it right.