Mar 26, 2018
Our Insights ...
There is no exact set age for retirement. The perfect time to retire varies from person to person depending on their circumstances and how they feel about the big lifestyle shift.
Here are some things you should consider so that you can enter your retirement at just the right time in your life.
It’s good to evaluate your reasons for wanting to leave the workforce. This will help you assess your priorities and set deadlines to help you reach your goal of retiring.
For some, retirement is about pursuing their hobbies and interests. Retirement may equal playtime for adventurous and active adults. Retirement may also be crucial to preserving one’s health after working many years in a physically-demanding job.
Other people, however, view retirement as boring and unproductive and they can’t imagine leaving the routine of a job they love.
Either way, retirement is an inevitability for most of us. That’s why it’s important to start planning right now, even if retirement seems a long way off.
How much will you need to live on?
As we recently wrote here, everyone has different needs and lifestyles so it’s hard to come up with an exact retirement figure for this blog.
However, typically a comfortable retirement is could set you back $40,000 a year if you’re single or $60,000 as a couple.
So if you retire at 65 and live until 85 you’ll need up to $1.2 million saved.
These figures will vary, of course, depending on your health needs and whether or not you owe your home.
Don’t leave your retirement to chance, no matter what your current earning potential is. Your retirement should not be reduced to whatever stray pennies you’re able to squirrel away right now.
Get some professional financial advice if you need help with planning for a financial future that can support you through the retirement years.
Are you debt-free?
Try to reduce all possible debt before going into retirement. Your retirement funds are pretty limited, so you don’t want to have to use those to pay off debts incurred while you still had the ability to earn.
Reducing debt may mean cutting back on luxuries and living on a budget to reduce your expenses right now.
What are your insurance needs?
Don’t underestimate your need for insurance coverage. That cost should also be factored into your financial plans for retirement. Consider your current health status and what injuries you may be at risk for in retirement.
Signs that you're ready to begin the retirement process
You probably won’t wake up one day and decide that you’re ready to retire. Rather, it’s a gradual process and one that you’ll need to talk about along the way. It’s important to discuss your hopes for retirement with your spouse and other close family members.
Retirement is a major life decision and one that you must be prepared for emotionally and socially as well as financially.
You may be ready to seriously pursue retirement if:
- You have trouble focusing at work now more than ever before, daydreaming about spending time with grand kids and family, travel, golf and or some other hobby
- You’re jealous of your retired friends
- You’ve got enough saved up to support yourself for the next 20 or 30 years or even more
Start the planning process now. Even if you’re on the brink of retirement, there are still some ways you can boost your retirement savings. As long as you’re working, it’s neither too soon nor too late to plan for the best retirement possible.
For smart saving strategies and more tips on figuring out your retirement needs, talk to the team at Calder Wealth Management. Call us on (08) 8373 3333 to schedule your appointment.
Written by Ben Calder, Private Client Adviser at Calder Wealth Management.
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