Retirement means different things to different people. Some folks just want to put their feet up, tend to the garden, and see their grandkids.

But that’s not for everyone, and if you’ve ever dreamt of a beach escape, a tree change, or just a dramatic change of scenery then retirement is the perfect opportunity to sell up and live that lifestyle.  

If you’re willing to look beyond the capitals it can be a surprisingly affordable proposition.

Location, location, location

Where you live will impact your day-to-day expenses. That’s hardly a secret. But it’s worth repeating, especially if you want to retire comfortably on a budget.

According to the Australian Centre for Financial Studies (ACFS), “Household income has some influence on expenditure … [but] household location appears to have a much greater impact’’.

So where are these affordable beach escapes and charming country towns? Before we get into that it’s worth mentioning the Downsizer Contribution Scheme, and how it can help you fund a better retirement.

Take advantage of your home’s equity

Sydney's average house price in 1973 was about $20,000. Adjusted for inflation that’s $262,000. Melbourne was roughly the same, according to data from the Australian Bureau of Statistics (ABS).

Those same houses are probably valued north of $1 million dollars these days. And since the kids have long moved out, there’s an entire generation of Australian retirees living in large 4-bedroom suburban homes that no longer suit their needs.

The Downsizer Contribution Scheme is a way to sell-up, boost your super, and do so in a tax effective way.

If you’re 65 or older and you sell your family home, you can contribute up to $300,000 (per person) towards your superannuation. This applies even if your super balance exceeds the A$1.7 million cap.

In other words, you can use the equity in a large family home to top up you super while downsizing to a more comfortable lifestyle.

In practical terms, that means someone living in Melbourne’s Brunswick, where the median house price is $1.25 million, can sell up, top up their super, and use the remainder to relocate somewhere a little smaller and more suitable to their lifestyle. That could mean a more affordable apartment, or it could mean a coastal lifestyle somewhere near the beach.

The great escape

So, where can you find that affordable retirement lifestyle?

According to CoreLogic, the median price of a home in Port Stephens (about an hour north of Newcastle) is $580,000. This is a lot more reasonable than anything you’ll find in Sydney. Similar prices can be found in beachside towns up and down the east coast.

Moving further north, Queensland’s Hervey Bay region offers year-round sunshine and a median house price of just $348,000.

Or perhaps South Australia is more appealing? It’s currently Australia’s number one location for retirees. With median house prices in Victor Harbor around $343,000 it’s not hard to see why people are packing up and relocating to the scenic beachside region.

Those are just a few examples, and perhaps they’ll inspire you to think beyond your current city and a family home that you may have outgrown.

Australia is a vast land, and if you’re looking for a better retirement there are ways to balance your super, your family home, and the government pension to live the life you’ve always wanted. Speaking to one of our financial planners is a great first step.