Steps To A Better Retirement At Any Age

Are you currently preparing yourself for retirement? Have you given any thought to whether or not you are heading in the right direction? It is never too late to develop a plan and begin saving for retirement, so there is no need to worry about missing the boat.

No matter what age you are, the following blog post will walk you through some actions you can take to improve your chances of having a comfortable retirement. Therefore, continue reading for some useful advice!

It is never too early to begin planning for retirement, even though it may seem like a distant dream at this point in your life. No of your age, you may take efforts to ensure a comfortable retirement.

There are a lot of people who experience anxiety about what will happen after this, particularly if they haven't planned ahead as thoroughly as they should have. But don't panic; there are always things you can do to make the most of your retirement years and make them more enjoyable.

There are actions that you can do right now to enhance your chances of having a comfortable retirement, regardless of your age. It is not too late to make some significant adjustments that will boost your chances of having a financially secure future, even if you are just getting started putting money down for retirement.

Even if they are ready for a change, many people have a hard time wrapping their heads around the thought of quitting their work. However, you shouldn't allow this deter you from making plans for your future! No matter what age you are, there are a variety of things you can do to make retirement a reality for yourself.

According to a popular proverb, "life really starts after 40." What happens, though, if you don't feel as though your life has truly started until a much later age, whether as a result of your own decisions or the circumstances of your life?

Retirement planning is important at any age, and there are steps you can take to make the most of your retirement years, no matter when they begin.

Establish a plan for your finances, including your savings objectives. It is essential to have a good idea of how much money you will require after retirement in order to maintain a comfortable lifestyle.

To begin, calculate your monthly expenses and then deduct any money you anticipate receiving from pensions, Social Security, or other sources. If you want to have a comfortable retirement, the amount that you save each month should be equal to the difference between your costs and your income.

Although no one enjoys the thought of contemplating retirement, it is something that all of us will eventually have to deal with. Don't worry if you don't know how to start planning for your retirement; there are lots of measures you can take regardless of how old you are. Continue reading this article for some insightful advice on how to make the most of your years of retirement.

Make a start on your savings right away. It is never too early to begin saving for retirement, and the sooner you begin saving, the more time your money will have to accumulate and grow in value. You should try to put aside between 10 and 15 percent of your monthly salary so that you may relax and enjoy your golden years without having to worry about money.

Nobody can say for certain when they will hang up their boots. It could be earlier or later than you anticipate, which is why it is essential to make preparations for a joyful and healthy retirement at any age.

Let's get started!

Retirement on Your Terms

The beginning of a new and maybe the most exciting phase of your life should coincide with the beginning of your retirement. You also have the ability to select the type of retirement lifestyle that best suits you, just as no two working lives are identical (with a bit of luck, some prudence and the right advice).

It's possible that retirement will imply less hours put in at the office for you. Or getting one's work done and then going off to see the world. But of course, it may be somewhere in between, and it is only natural that the way you spend your time after work would evolve over time.

No matter what you have in mind for your life after work, we are here to assist make it a reality. We offer you a shifting mix of investment advice, retirement planning, super and insurance plans, tax and social security guidance, estate planning, and advise on philanthropy because retirement is so personal and because it varies over time.

What is the result? A life after employment in which you are supported financially by your retirement savings. In this state, you are free to enjoy your life without being constrained by concerns about money.

Making Retirement Plans

In order to effectively plan for your retirement, it is helpful to have a solid understanding of where you now stand financially. The amount of money you'll need to have saved up by the time you reach retirement age will vary according to the way you've spent your life up until this point and what you have planned for your later years.

It goes without saying that preparing for retirement involves a great deal more than just the aspect of finances; given that it is a very individual choice, one must also take into account the psychological facet of the process.

If you take the time now to identify what kind of life you eventually want to live, it will help you work through those emotional decisions and plan out how hard your funds will have to work - and this is where we can help you. In addition, receiving direction from an experienced financial counsellor helps alleviate the stress that is associated with making financial preparations for retirement.

The following are some of the primary concerns that should be addressed as part of your financial retirement plan, which can be helped with by our skilled financial advisors.

1. Resources & structure

Getting the organisation of your assets in the appropriate place is analogous to preparing the groundwork for a house. The structure relates to the manner in which these assets are held, for as within a family trust or superannuation.

If you are able to get that framework correct early on in the process of planning for your retirement, it can serve as the foundation for the rest of your financial arrangements. In addition to this, it may bring benefits over a longer period of time, particularly with regard to the reduction of taxable income and the preparation of an estate.

2. Tax and income management

Making sure that your income is directed towards the most productive plan, such as towards debt reduction or super, will assist ensure that your wage, one of the most important assets, is working hard for you while you work towards retirement.

This may require you to examine whether you should make additional payments towards the balance of your mortgage or make tax-effective contributions to your retirement account instead. The chosen method will not be the same for everyone, and we are here to assist you in determining whether or not it will be suitable for you.

3. Superannuation

The world of superannuation is a complicated one, but developing a solid strategy early on can pay off in the long run if you take into account the advantages that superannuation provides in the areas of taxes, investments, and estate planning.

We are able to assist you with optimising your contributions, selecting the appropriate super fund for you, determining how much you need to save and when you can use it, and determining how much you need to save.

With the help of our easy-to-understand guide, we will walk you through the five most important aspects of a superannuation plan that you should think about when comparing different plans. This will make it much simpler for you to make a decision that is better informed regarding your superannuation and to find the option that is most suitable for you.

4. Estate Planning

You put in a lot of effort to accumulate wealth so that you may enjoy a comfortable retirement, but for many individuals, it is also necessary to leave something behind for the next generation.

A solid estate plan ensures that your hard work will not be in vain by facilitating the transfer of your wealth to your beneficiaries in a way that minimises the impact of taxes on the distribution of your assets.

If you start planning your retirement early on, you can help reduce some of the emotional stresses that can sometimes occur in the later stages of your life by getting the details of this component clear as soon as possible.

5. Time commitment and participation

It is possible that the amount of time you devote to managing your finances and planning for retirement will change as you progress through the various stages of your life.

Because of the challenges of juggling job, family, and other personal commitments, there will likely be periods when your finances will be lower on your list of priorities.

It is in your best interest to think about how much engagement you are willing to take on right from the start, as well as how much can actually be accomplished.

Having access to professional support and assistance during crucial decision-making moments as well as during periods of legislative change can help reduce the administrative burden associated with managing your finances, thereby allowing you to build up more self-assurance and move forwards with greater determination.

Increasing Your Super Savings With These 10 Tips

Investigate what you may do while you are still generating an income and have time on your hands, keeping in mind that not everyone will be qualified for the Age Pension offered by the government after they reach retirement age.

A good number of us tend to ignore the existence of super. We are aware that it is present, and we are also aware that it is ours. When the moment comes, we anticipate, or at least hope, that it will be sufficient. If it isn't, we probably have some knowledge of the Age Pension programme run by the government, and we can consider using that as a fallback option in the event that we don't have enough money.

Some of us are blissfully unaware of the fact that not everyone is qualified to receive the Age Pension, and if we are qualified and intend to rely completely on it in our later years, we may have to settle for a lifestyle that is less than modest.

The question then becomes, roughly speaking, how much super do we need, and how can we increase our super savings while still making the most of the tax benefits that are often available inside the super system? Check out the points below for information, as well as some other essential considerations to keep in mind.

How much super do you need?

Figures from the Association of Superannuation Funds of Australia (ASFA) from December 2020 indicate that individuals and couples around the age of 65 who are interested in retiring today will need an annual budget of $44,224 and $62,562 respectively to fund a comfortable lifestyle. On the other hand, individuals and couples around the age of 65 who are interested in retiring today will need an annual budget of $28,179 and $40,739 respectively to live a modest lifestyle, which is considered to be better than living on the Age Pension

Note that these statistics are derived from the assumption that individuals have full ownership of their homes and enjoy a good level of overall health.

Super contributions with advantages

 1. Contribution deductions for taxes

Contributions that are made voluntarily and are deducted from taxes are known as tax-deductible payments. If you are eligible, your company may give you a super guarantee, but you may also opt to make additional contributions on top of that.

You are able to make these contributions using money that you have already paid taxes on (for example, when you transfer money from your bank account into your super), and then you are able to claim a tax deduction for them when you file your tax return.

Investing money in a retirement fund and deducting it from your taxable income may be beneficial if you expect to receive some more income in the future on which you would otherwise be subject to taxation at your regular rate of income taxation (as this may often be higher).

In a similar vein, if you have recently sold an item that is subject to capital gains tax, you may choose to make a contribution to your retirement fund, either partially or entirely, in order to qualify for a tax credit related to that contribution. Once more, this could assist in lowering the amount of the capital gains tax that is owed, or possibly wipe it out entirely.

2. Co-contributions from the government

If you are an employee with a low to middle income and have made a contribution to your super fund after taxes but have not claimed a tax deduction for it, you may be eligible for a government co-contribution of up to $500. Eligibility is determined by whether or not you have made an after-tax contribution to your super fund.

If your total income for the 2020–21 financial year is $39,837 or less and you contribute $1,000 after-tax to your superannuation fund, you will be eligible for the maximum co-contribution of $500. This applies only if you make contributions to your superannuation fund.

During the 2020–2021 fiscal year, if your total income is between $39,837 and $54,837, the maximum amount of benefits you are eligible to receive will gradually decrease as your total income increases.

You will not be eligible for any co-contribution if your income is equal to or greater than the higher income threshold of $54,837 in the 2020/21 financial year. This threshold will be in effect.

3. Spouse contributions 

You should give some thought to making contributions on behalf of your spouse if you have a higher income than your partner and would like to boost their retirement savings, or if you would like to do the same for theirs.

You may make a contribution to your spouse's super fund and claim an 18% tax credit on contributions of up to $3,000 made through your tax return if you meet the requirements.

If you want to be eligible for the maximum tax offset, which comes out to $540, you need to contribute a minimum of $3,000, and your partner's annual income needs to be no more than $37,000. Other requirements include that you and your partner both have to be Canadian citizens or permanent residents.

Even if their income is greater than $37,000, you may still qualify for a portion of the offset. You will no longer be eligible for any offset after their income hits $40,000; however, you are free to make contributions on their behalf even after this point.

4. Salary sacrifice contributions

The term "salary sacrifice" refers to the situation in which you make the decision to have some of the money you earn before taxes contributed to your retirement fund by your employer. This contribution is in addition to whatever money they may provide you as part of the "super guarantee."

It will result in a decrease in the amount of money that you keep for yourself. However, because you'll only be taxed 15% on the money that you salary sacrifice (or 30% of your total income that exceeds $250,000), this indicates that, for the vast majority of Australians, you'll generally pay less tax on your salary sacrifice super contributions than you do on your income. This is because 30% of your total income that exceeds $250,000 is considered to be above the $250,000 threshold.

5. Downsizer contributions

The proceeds from the sale of a person's primary residence can be contributed voluntarily to their superannuation account by people aged 65 and older, up to a maximum of $300,000, regardless of whether or not they are working, how much they have in their superannuation account, or how much they have contributed in the past.

Both members of a couple are eligible to take advantage of this opportunity, which means that a combined total of up to $600,000 can be donated towards retirement savings. However, there are potential benefits, rules, and other things that you will want to be aware of before moving forwards.

Additional pointers

6. Find your lost super

There is a possibility that you may have misplaced some of your retirement savings if you have moved frequently, changed occupations, your name, or your residence over the years, or worked part-time or casual jobs.

If this is the case, you can be responsible for paying multiple sets of fees for various super accounts. It is in your best interest to find out whether or not the ATO is in possession of any unclaimed superannuation funds on your behalf.

When super funds transfer the amount of tiny, dormant accounts directly to the ATO, this is the result. Find out more information about how to locate your missing or unclaimed retirement benefits.

7. Think about whether it would be beneficial to combine your super

There are a few factors to think about before deciding whether or not to consolidate numerous retirement accounts into a single one.

Potential benefits

• One single rate structure
• Reduced levels of bureaucracy and paperwork
• It may be simpler to manage an investment strategy that is tailored to your particular requirements.

Possible pitfalls

• Exit fees and withdrawal fees may be charged by certain funds
• There may be financial repercussions as a result
• There is a possibility that you will lose some of the functions and benefits that you presently have, such as insurance protection.

8. Do you qualify for the super tax offset for low income?

Imagine that you have a yearly income of $37,000 or less, and that your company contributes to your retirement plan on your behalf. If this is the case, the government may credit your superannuation account with a portion of the tax that you already paid on those contributions, up to a maximum of $500 each year.

Let's say you have a low enough income to qualify for the low-income super tax offset. If this is the case, the good news is that once you have submitted your tax return, the ATO will automatically compute it and then pay it into your superannuation account.

9. Study your available investment alternatives

The vast majority of retirement savings plans provide you the opportunity to select your prefered combination of asset classes and investment possibilities. Your attitude towards risk and the amount of time you have available to invest are the two primary considerations that should guide your decision regarding which choice is best for you.

If you're young, you might have more time to ride out the highs and lows of the market, and as a result, you might be more prepared to take on greater risk in the pursuit of larger potential returns.

On the other hand, if you are getting closer to the time when you may use your retirement savings, you might want to take a more conservative strategy because it will be more difficult to recover from a drop in the stock market.

10. Look into more critical elements of your super

Because your super should be working for you, it is essential to examine their job description at least once every year and check items such as:

• Success of the fund (with the caveat that past performance is not always an indicator of future performance)
• Any fees that you could be paying at this time
• Any insurance coverage you could already have through your super, as well as whether or not it meets your requirements at the moment.

Important Considerations

• There is a cap on the amount of money that can be contributed. If you make more contributions to your retirement account than the allowed maximum, you may be subject to additional taxes and penalties. Learn more about the contribution limits that currently apply as well as the upcoming modifications that will take effect on July 1, 2021.
• Imagine that you are above the age of 67 and wish to make voluntary contributions to your retirement account. If this is the case, you are subject to a work test, which requires you to have worked for at least 40 hours in the preceding 30 days, unless you are entitled for an exemption from the work test due to your recent retirement.
• Your investment in a retirement plan may experience both increases and decreases in value over time. Therefore, before making additional contributions, you should ensure that you have a solid understanding of, and are okay with, any potential risks that may be associated with doing so.
• The general rules that control when you can access your superannuation are established by the government, and in most cases, you won't be able to do so until you reach your preservation age and fulfil a condition of release, such as retiring.

How to pick a financial advisor

The process of putting your thoughts about your financial goals into action might be aided by the assistance of financial planners. Here are some tips to consider when selecting a financial planner.

When it comes to putting your financial goals into action, financial planners, who are often referred to as advisers, may assist you in doing so; however, how should you go about selecting a financial planner?

Because people's financial conditions and ambitions are so different from one another, the advice that you require from a financial planner will be uniquely tailored to meet your requirements.

In order to assist you in selecting a financial planner in whom you can have full faith, we have devised a strategy consisting of three steps.

1. Visit ASIC’s financial advisers register

When you have a shortlist of potential financial planners, you may use the ASIC's financial advisers registration to research their background, qualifications, and current work status before getting in touch with any of them.

You can conduct additional research by conducting an internet search to learn more about the planner as well as the firm that they work for.

2. Verify the planner's credentials

Most commonly, those who get into the field of financial planning have a background in accounting, stockbroking, or another area of finance. Others have received specialised training in the planning of investments and retirement, and a good number of them have finished a Diploma in Financial Planning or an equivalent qualification.

Planners need to be licenced by the Australian Securities and Investments Commission or by an authorised representative of a licensee in order to advise clients on securities such as debentures, shares, bonds, and managed funds. Alternatively, planners can receive authorisation from an authorised representative of a licensee.

Ask the prospective financial planner you are considering if they are members of any professional groups or bodies, such as the Association of Financial Advisers or the Financial Planning Association of Australia.

Personal financial advisors are required to carry out their tasks and obligations in accordance with applicable laws, policies, and industry standards.

Planners need to have access to research on investment products and knowledge on challenges in the business and legislative environment that may affect investment decisions in order to do their jobs effectively.

These could be part of an ongoing service that the planner provides, in which he or she evaluates the effectiveness of your investment strategy and portfolio.

3. Examine the financial services manual and pose inquiries

You can get guides by searching for them on the internet or getting in touch with a financial adviser or the company that they work for. The services that are provided, the pricing structure, the owners of the company, whether or not they have connections to certain product suppliers, and the licence number will all be detailed in the guide.

Before you commit to participating in something, there are a few questions you need to ask a planner. The Australian Securities and Investments Commission (ASIC) provides a detailed list of questions that should be asked of a financial adviser; nevertheless, there are two questions that should be brought up right away with your potential financial planner.

What goods is the financial advisor able to recommend?

The planner may be able to provide you with recommendations regarding your existing products. Do they carry a variety of products that can satisfy your requirements? Look for a planner that has access to a variety of items so that you can be sure you are getting the solutions that are optimal for your circumstances.

What are the fees and pay structure for the financial planner?

Before you decide on an investment, your financial adviser should walk you through the details of the fees that will be charged. Request that the cost schedule and payment structure be communicated up front.

Also, make sure to enquire about the services that are covered by the fees by the advisor. For instance, does it come with a Statement of Advise (SOA), actions for putting the advice into action, and the option to return to the advice at a later date?

Before deciding on an investing strategy, it is of equal significance for you to determine whether or not you are content with the guidance that is being provided to you by your financial advisor. If you are unsure, talk to your financial planner about it or get a second opinion from someone else.

Read the information provided by ASIC regarding the fees of financial advice before engaging the services of a planner.

The selection of a competent financial planner is a crucial step to take. When it comes to formulating a plan that will be successful for you, the counsel of a qualified financial planner can be really helpful.

Take Action Now and Speak With Professionals

Regardless matter what your intentions are for retirement, figuring out how you will get there is one of the more challenging and time-consuming components of the process. Obtaining information that can be relied upon is of the utmost importance, and this is one area in which a financial consultant can be of great assistance.

They are able to assist you in determining and accomplishing your objectives, accumulating and organising your wealth in a manner that is appropriate to your circumstances, and guiding you down the path to achieving financial independence in retirement.

Talk to one of our seasoned professionals right away.