As you edge towards the later years of your working life, thoughts about your retirement start to increase and become more important. On top of all other adjustments and life changes this life stage can bring, one vital consideration is sometimes overlooked: will I have enough super to last in my retirement?
Helping you achieve greater retirement outcomes is at the core of what we do. Having the ability to turn your super into an income stream (like our Flexi Pension) along with the Age Pension can ensure you reach your desired standard of living in retirement. But attempting to forecast or predict how much you’ll need can be difficult.
Funding things such as holidays, paying off debts, upgrading your car, home improvements and increased healthcare costs are all common thoughts. A ‘comfortable retirement’ compared with a ‘modest retirement’ (according to ASFA) could mean a big difference to your quality of life once you’ve stopped working.
Attempting to project when you plan to retire, how long you’ll be retired for and what other expenses you might have only adds to the complexity. The prospect of longevity risk is also worth considering.
What is longevity risk?
It’s the risk of outliving your retirement savings and having to rely on the Age Pension. No one can predict the certainty of the Age Pension’s existence, but there are ways of managing longevity risk with some simple strategies.
What you can do
- Prepare a budget: predicting how much you’re likely to spend at retirement can help create a picture of your future financial situation,
- Keep track of what you spend your money on for a month to give you an idea of your annual expenses,
- Consider ways to maximise your Age Pension entitlement,
- Think about your investment strategy. While your risk appetite is an important consideration, so too is achieving an investment return that exceeds inflation. Getting your investment mix right (and regularly reviewing it), may result in your retirement savings lasting longer.
You might have an idea of what retirement will look like in your head, but for many people what actually happens after retiring is very different. Listen to our podcast on why this might be happening and what people can do to help make sure their retirement expectations become the reality.
Episode 2 file type/size: MP3/21.9MB
View episode #2 transcript
How we can help you
Predicting your adequacy in retirement doesn’t have to be a daunting and onerous task. We’ve developed a number of resources (including easy-to-use tools and calculators) to help you plan and prepare for your retirement.
Our retirement adequacy calculator can help you work out how much super you may have when you retire and what income you’ll need to live comfortably. The calculator can be used by anyone at any age and will estimate your retirement adequacy based on your income requirements.
We regularly hold seminars on retirement-related topics at more than 80 venues around Australia—on and off university campuses. Even if you’re retired, you can still attend these seminars. One of the topics we cover is exploring how to plan an easy transition into retirement and the emotional impact this change can bring.
GET FINANCIAL ADVICE
You’ve worked hard to save for your retirement, so seeking professional advice may help you set a course that is best for you. Everyone has different needs and goals depending on their situation. UniSuper Advice can help with retirement strategies, as well as areas outside of super, including insurance, wealth accumulation, estate planning and much more whatever your stage of life.