What’s your secret?
The key to a rewarding retirement isn’t just about getting a certain return on your savings or splashing the cash on an annual European holiday.
It’s about being able to live the life you want without having to worry how much it costs all the time, meaning after years of working you can thoroughly enjoy yourself.
There’s a few things you can do before, during and after retirement to help you plan, stay financially fit, live a life you can afford and not fight with your partner (as much) along the way!
1. How much in savings?
What is the value of your savings, after you take any debts you have out of the equation?
Putting a value on your super, or other savings like an investment property or share portfolio can help you work out how much income these assets can offer you in retirement. Once you know what you might be able to earn you can compare this to your estimated expenses to work out if this will be enough to fund your basic living costs.
2. Talk to your partner
Make talking to your partner part of your retirement plan. While it’s great to have freedom to do and spend what you want, the reality is for couples your savings will generally be in the same account and one of you might have different ideas about how this should be spent.
The conversation will cover everything from whether you should take that expensive cruise next year to if you can afford to pay for some of the grandkids’ school fees. You might have different ideas about what you want to give up if there are things you want more. Laying your thoughts out on the table as early as possible will help you plan for your future.
3. A contingency plan for you cash
While you can plan how much it will cost you to live each year, the chances of unexpected costs popping up are high. Knee replacements for you or the dog are things you might not have ever entertained.
It’s important to have a backup plan in case you need to get your hands on some extra cash. This doesn’t have to be an off the cuff thing, instead you might have a kitty - a pool of funds you vow never to touch unless an emergency strikes.
If you haven't squirreled away extra cash you might have a part time job instead, which you can use to build up your savings or fund the more frivolous things in life.
4. Value what you own
Downsizing the family home could potentially free you up a couple hundred thousand dollars. You can then invest this so your super can support a higher amount paid to you as a pension.
By freeing up some cash into a more liquid form than property, you have access to it for income or if something happens and you need money quickly.
5. Stay in shape
The key to having adequate financial health is ensuring you keep your mind and body active and as healthy as possible.
Committing to this will not only ensure you are improving your life, but it can give you the strength to make the hard financial decisions you need too. And it might mean you save on medical bills too.
