Why are our retirees running out of money in retirement?
Main Source of Personal Income at Retirement
Our Research Found That :
Most retirees recieve income from at least two different sources. From 2011 to 2015, the number of people living from Government Pensions has increased by 3%, with a total of 47% of retirees living from the Government. Only 7-8% of Australian's, fund their living costs in retirement with Personal Income such as (rental properties, business income & dividends). The number of retirees living from No Personal Incomes such as (savings, assets & partners), has increased from 810,300 in 2011 to 824,500 in 2016. A small percentage of Australian's live off Workers Compensation and other types of income.
Did you know that the Government Pension is only $407 weekly for singles and $614 for couples. You should ask yourself if this will be enough to support your desired lifestyle in retirement?
By planning early for your retirement, you can combine several income sources so you have more and don’t only rely on a single source. Employing a healthy superannuation and personal investment plan, will allow you to enjoy the lifestyle you deserve in your later years.
TOP 10 PERFORMING FUNDS 2016-2017 :
- Hostplus Balanced (13.2%)
- Australian Super Balanced (12.4%)
- Sun Super Balanced (12.3%)
- First State Super Growth (12.3%)
- Club Plus MySuper/Balanced (12.2%)
- Intrust Balanced (12.1%)
- Prime Super MySuper (12.0%)
- Kinetic Super Growth (11.9%)
- Cbus Growth (Cbus MySuper) (11.9%)
- Catholic Super Balanced (MySuper) (11.8%)
SELF MANAGED SUPER FUNDS :
An SMSF provides you with more control over your financial future and can offer you significant benefits in retirement:
- Investment Choice: More investment options than any other fund.
- Tax Strategies: Investment income is capped at 15 percent in accumulation phase.
- Flexibility: Adjust your investment mix when it suits you.
- Transparency: Understand where your money is invested.
- Cost: Capped fees, not a percentage of your fund balance.
- Consolidate: Combine your super assets.
More information can be found at the following websites:
PERSONAL INVESTMENT :
Through investing in assets that provide you with both capital gains and cashflow, you would be taking control of your future and planning for a better lifestyle in your later years.
Avision chooses property as a safe and reliable source of wealth creation. Talk to us about investment opportunities to help support your retirement.
We advise that you consult with your financial advisor’s to create a detailed plan to support your retirement goals.
Research shows that most Australian’s are NOT on track towards reaching a comfortable income during retirement, which means that a larger percentage will continue to rely on the Government Pension as their main income source.
What is changing the nature of retirement?
Life expectancy is the most commonly used measure to describe population health and reflects the overall mortality level of a population. In Australia, life expectancy has improved dramatically for both sexes in the last century (World top 10). This increase has been led by the advances in health and safety in many areas, along with other generational growth factors.
The result of a longer life expectancy, means that retirees will need increased funds to cover a longer and more active later years.
As time passes, cost of living increases. As a consequence, a high percentage of retirees are withdrawing more money than what they have budgeted for to support their retirement. In other words, approximately 20% of retirees are running out of money.
Despite superannuation reforms dating back to over 20 years, the problem of inadequate retirement savings remains a significant public policy issue for Australia.
Modern Theory of Retirement
There has been a significant shift in the expectations of what ‘modern’ retirement entails. People seek to live the ‘good life’, for this they expect to have a phase focused on increased travel and leisure activities, rewarding themselves for their hard work during their working life.
What can I do to make my money last?
With retirement lasting longer, planning from an early age is critical. Research shows that most Australian’s only start saving or thinking about retirement in their 40’s. The growing cost of living and the desire to live a better life are placing a greater demand on the need for taking control of your future by making and executing your retirement plan.
Both Personal Planning and Financial Planning are critical for your retirement.
Personal Planning will allow you to establish clear retirement goals based on your desired lifestyle.
Financial planning is what will allow you to make your Personal Plan a reality.
Planning early gives you the best chance to achieve financial security and live the lifestyle you deserve in retirement.