In Australia, we have a rising number of retirees who will outlive their savings. In fact, up to 60% of retirees will run out of money in 20 years

Research conducted in 2021 found that six in 10 Australians said they were concerned they won’t have enough money when they retire. This is a sharp increase from 2015, where just four in 10 indicated the same concern.

Are you concerned about your retirement? Do you have a specific money goal in mind that you are seeking to attain before retiring?

The choices you make now can have a huge impact on the type of retirement you can afford to have.

What kind of lifestyle do you want?

When we picture our retirement years, most people imagine a life travelling around in a caravan, spoiling the grandkids, taking up new hobbies, going on the occasional cruise.

At the very least, you would hope that you’re not stressed about the state of your bank account and worrying about bills. The golden years of life should be about enjoying the fruits of all the years spent hard at work.

But the unfortunate reality for many Aussie retirees is counting down the days until the next pension cheque.

So how much do you actually need to set yourself up for a retirement where you get to live a lifestyle of choice?

Figuring out your number

Each individual or couple will be different. So you’ll need to determine what your projected expenses are and then add some buffer. The lifestyle you are accustomed to and the type of income you currently have will have a big impact on your number.

 Here are some factors that you’ll need to account for:

• When will you stop working?
• Will you enter retirement debt free?
• What are your spending habits?
• What kind of lifestyle do you want to live?

Once you’ve answered these you can start to determine how much you will need for a comfortable retirement. The Australian Treasury estimates that the average Australian who has no mortgage and retires at 65, will need up to 75% of their pre-retirement income after tax.

Say for example you need $100,000 per annum for retirement, you will then need to achieve $2 million in net assets or investments. Here’s why: $2 million at 2% returns = $100,000 per year.

This could include money in:

• Superannuation
• Trusts
• Personal bank accounts
• Investments

It’s not too late!

Obviously the sooner you can start building towards your retirement the better. But that doesn’t mean there isn’t hope for you at whatever stage you are at. You always have options and opportunities.

To get personalised advice on your circumstances and how you can best prepare for a comfortable retirement, book a complimentary discovery session.