Your post-work life probably seems like a distant (or non-existent) priority. That’s normal. But when you actually get there, do you really want lifestyle or financial FOMO? Here’s how some simple planning now can make a big difference to your standard of living in retirement.
All financial plans start with a budget. And whether it causes eyes to roll or flashes of ‘can’t deal’ as we reach for our phones, but there’s no denying it. And the best bit – it’s not as hard as we think!
Basic budgets can take as little as 15 minutes. It’s well worth the time, because basic they answer some important basic financial questions:
• How much am I spending?
• What improvements can I make?
• How much can I save?
A simple budget tool – like the one at unisuper.com.au/budget-planner – will help you remember the little things that mightn’t always be front of mind.
With a budget in place, you’ll have a good idea of how much you can save – and you’re one step closer to charting the path to your financial future.
Make a list of financial goals you want to achieve – short-term, medium-term and long-term. Short -term examples could include annihilating existing debt, or saving up for a home. Medium-term goals could include buying a home – or if you have a mortgage, paying it off sooner – or getting onto investment plans for things like kids’ education costs. Long-term goals might include maxing your retirement savings or paying off a mortgage.
Your goals should be “SMART”: specific, measurable, achievable, relevant and time-bound. They’ll change over time, so revisit them regularly. How much is enough? There’s no one-size-fits-all answer to how much your future self will need. But research by the Association Superannuation Funds of Australia (ASFA) shows that for a single homeowner, $545,000 in today’s money is required to maintain a ‘comfortable’ retirement lifestyle – $640,00 for a home-owning couple. That’s $42,764 a year in retirement for a single homeowner. And $60,264 a year for a home owning couple.
But what if the worst happened? Insurance touches pretty much every part of our lives. We insure cars, houses – even our pets! But are we under-insuring ourselves?
Bad luck with health can permanently undo our best laid plans, so it’s essential to make sure we’re covered in case you-know-what hits the proverbial fan.
These are just some simple ways you can start putting a few things in place to make your post-work life the one you always dreamed about.
Need help? To find out more about insuring your future, speak with our Financial Planner at Cranbourne, Bruce Chisholm.
Bruce Chisholm – Financial Planner
Cranbourne: 5990 1000
Source: Article Written by Renee Bilske, Super Informed Issue (August, 2018).