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Your pre-retirement checklist

I'm approaching retirement | | 2 min read


Are you retirement ready? If you’re thinking it might be time to escape the 9-5 grind and put your feet up, you probably have a lot of questions: 

• Do I have enough super?

• How do I access my money? 

• What sort of benefits am I entitled to?

While there’s no substitute for proper financial advice. We’ve created a checklist to help get you started on your road to retirement.  

1. Do I have enough to retire?

According to ASFA (the Association of Superannuation Funds of Australia), a couple needs approximately $640,000 in retirement savings for a comfortable lifestyle. For a single person that number is $545,000. Those figures translate to an annual income of about $62,000 and $44,000 respectively.

When talking about the ASFA numbers it’s important to remember two things: first, they assume you own your home outright and, second, they’re based on take-home (after tax) income. 

For an overview of your retirement savings and what that means in annual income, our Retirement Calculator is a great place to start. 

2. How do I access my super?  

Building up a healthy superannuation balance is important, but how you invest and access that money will determine how long it lasts.

Transferring your super balance into a Pension Account is the easiest and most common way to start your retirement. This allows you to draw down an annual income from your savings while the balance continues to earn investment income in a tax-free environment. This is something your financial planner can assist with. 

You also have the option of withdrawing your super when you retire (assuming you meet the age requirements). Keep in mind that this may have significant tax and Age Pension implications. For example, you may not qualify for certain pension benefits. We recommend speaking with a financial planner before making any decision. 

3. What about my mortgage and other debts? 

The ASFA numbers we mention above assume that you own your home outright. If you’re paying rent or continuing to service a mortgage in retirement the numbers will vary, and you’ll likely need more super.

Having outstanding debts as you approach retirement isn’t necessarily a problem, but it does require some planning. For example, do you use your super to pay off your mortgage? There’s no simple answer; but speaking to a financial planner can help you understand your options and what they mean in the long term.

4. Am I eligible for government benefits?

Depending on your superannuation balance, you may be eligible for a variety of government benefits and subsidies. While the Government Age Pension is only $24,554 per annum for individuals, many people live on a combination of the Age Pension and their superannuation savings in retirement. That means even a modest superannuation can be used to boost your age pension payments and enjoy a more comfortable retirement. 

Our Retirement Calculator can show you how long your retirement savings will last and when you’ll be able to claim a full or part pension. 

Speaking to a financial planner can also help you understand your options, possible entitlements, and how to apply for them. As a first port of call, try the Government’s Age Pension website.

5. How will you spend your time?

People get so caught up in the financial side of retirement that they sometimes forget to ask themselves the most important question – what is it that I’d actually like to do with all that free time?

If you’re used to the comradery of work and seeing your friends every day it can be difficult to lose that connection. And couples that have spent decades following their own daily routines can also struggle when they find themselves spending a lot more time together at home.

None of this is unusual or unique. But the reality is that people are happiest when they have a sense of purpose, and a reason to get up and about. Retirement is an opportunity to rediscover those hobbies, interests, or talents that may have gone dormant while work life took precedence. 

Volunteer work, social groups, fitness, or a new hobby are all ways to reconnect with yourself, and meet other, likeminded people. 

What should I do next?

If you’re approaching retirement and starting to think about the issues outlined above, you’re not alone. Whether you’re 5 years or 12 months from retirement, speaking to someone can help you make plans for the future and provide added piece of mind.

Note due to COVID-19

The coronavirus pandemic has impacted our ability to conduct face-to-face appointments, but if you’re ready to speak with a professional, our financial planners can discuss your options online or on the phone. The initial appointment is available at no charge. You can make a booking online, or by calling us on 1300 963 720.

Any figures quoted are correct at the time of writing but may be subject to change.

Authorised by Togethr Trustees Pty Ltd (ABN 64 006 964 049; AFSL 246383) ('Trustee') the trustee of the Equipsuper Superannuation Fund (ABN 33 813 823 017). Catholic Super is a division of the Equipsuper Superannuation Fund (ABN 33 813 823 017). Financial advice services may be provided to members by the trustee's related entity. 

Togethr Financial Planning Pty Ltd (ABN 84 124 491 078; AFSL 455010). The information contained herein is general information only. It has been prepared without taking into account your personal investment objectives, financial situation, or needs. It is not intended to be, and should not be, construed in any way as investment, legal or financial advice. Please consider your personal position, objectives, and requirements before taking any action. Past performance is not a reliable indicator of future performance.

© 2020 Togethr Trustees Pty Ltd. For further information please our contact our Service Centre on 1300 655 002 or visit our website: csf.com.au.

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