Are you prepared for 30 years of retirement?

Are you prepared for 30 years of retirement?

Emma Brooke from GTC Financial says that whilst it’s something most of the population anticipate, far too few people prioritise planning for their retirement properly or effectively.

“I realise that given the financial demands of everyday life, planning your retirement may be a relatively low priority,” she says.

“Many people also think that they have plenty of time to plan, but before they put off planning for their retirement any longer, there are some key facts everyone, regardless of their age now, should consider.”

Research suggests that a male currently aged 65 has a future life expectancy of 19 years and for females currently aged 65 it’s 22 years.

“Of course these are just the averages and they are increasing steadily but as these trends continue, someone’s retirement could stretch to three decades, or maybe even longer,” Ms Brookes said.

“People simply can’t rely on the pension to get them a lifestyle they are used to or perhaps want.

“The full single rate age pension only provides around 25{7a2eb471754f58cbf59baa93ee81dc7b74d186cb2e306188f39c85ba863dbab8} of average weekly male earnings.”

“What’s more, qualifying for the age pension may become more difficult in the future, given our population is ageing.”

“I would also strongly advise against waiting for a trust fund or inheritance to kick in.”

“It might be that your parents end up spending all their savings and may even need to downsize their home to help make ends meet. So, if you’re relying on an inheritance to fund your retirement, you could be disappointed.”

Emma added that even Super alone might not be enough to live a financially independent lifestyle.

“With some of your money going into Super through compulsory employer contributions, you’re off to a good start.

“But assume that those employer compulsory contributions will mean you have enough super to get you through your retirement and you could be in for a nasty surprise.”

Research conducted by Rice Warner Actuaries revealed that Australia has a shortfall in super of close to $1 trillion, which means many Australians may not have enough super to fund their retirement.

In short, Emma suggests you should start planning now and she says that with a bit of preparation, it’s possible to plan for a long and comfortable retirement.

“Strategies like salary sacrificing into super, making lump sum contributions or using a transition to retirement strategy, are all smart strategies to consider to boost your super, and some of them generally have tax benefits too.

“It’s also possible to use your super to start a pension that pays you a regular income. Some pensions even guarantee to pay you an income for the rest of your life, negating the risk of outliving your savings.”

If you would like to talk to Emma about the best way to see how your retirement savings are currently tracking, and find out what you could do now to increase your super for retirement, contact the GTC Financial Team today on 49 725 177. They can help you set realistic goals and put a plan in place to achieve them.


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Source: NAB
[1] Australian Bureau of Statistics, November 2013
[2] Rice Warner Actuaries, ‘Longevity Savings Gap’, Sep 2012

This information is general information only.  You should consider the appropriateness of this information with regards to your objectives, financial situation and needs.

GTC Financial Services Pty Ltd ABN 94 010 624 914 atf GTC Financial Services Trust ABN 69 596 897 575 is a Corporate Authorised Representative of Infocus Securities Australia Pty Ltd ABN 47 097 797 049 AFSL and Australian Credit Licence No. 236523