The earlier that you begin planning retirement, the better outcome you’ll have in the future. Failure to do so, could mean that you may be sacrificing how your golden years pan out.
The Age Pension is made to be liveable – however, it does place certain limits on how you live your life.
For instance, it may restrict the kinds of activities that you get to do – like travelling, recreational spending, and purchasing presents.
ipac financial expert Colin Lewis states that it’s never too early to begin planning for retirement.
“Historically, people only think about retirement two to three years out from retiring and by that stage they might have left it too late to accumulate that nest egg. And with contribution caps, gone are the days where you could make it up by putting everything into super at the last minute.”
This is why it’s extremely important to get ahead of yourself at an early age, and stow away funds for your retirement income as soon as you can.
less now, more later
Spending less now, means that you can put away more for later. Not only will you be ensuring that you can live your retirement years in comfort, but you can also earn a fair amount of interest in long-term deposits.
Consider setting yourself a strict budget to stick to each week – this means maybe cutting down on extravagant spending. Save it for your retirement years, when you have more time to enjoy it!
pay down your debt
Another important factor to consider is to pay down your existing non-deductible debt, and try to stay away from taking on more. This means credit cards, personal loans, mortgages, and student loans – these can all linger on for years and may impact how much you’re saving towards your retirement.
Pay these down as soon as possible, and set yourself a specific timeframe to work towards.
It might seem to be an obvious idea, but it is one that many people seem to overlook: set a savings goal each week or month in order to have something to strive towards.
A good way of doing this, is to divert part of your paycheck each payday to a savings account.
Often, banks allow you to set up a diversion to another account, which means that each time you get paid, a certain amount will automatically be taken off your pay. This is a good option, because it means that you won’t even notice you’re setting aside funds and therefore won’t miss them.
we can help
If you are thinking about planning for your retirement, we can help. Why not get in touch by calling 1800 626 881 or by using the ‘contact us’ tool on our website.