And now, the end is near
isn’t required yet. My own plan involves a retirement that extends to 90, with a declining income in the elderly years. I’m never going to de-risk at such an early stage.
Regrets, I’ve had a few, but not this one
Do you really need half your old salary in retirement? With no mortgage or savings required and a $15,000 addition of superannuation, those who can achieve half their salary are likely to have a regretfree comfortable retirement. Many well-off people are wasting this opportunity. Cut your cloth however you see fit, but know the result it gives.
Of course there are ways of changing your retirement fund size or the income from it at the 11th hour:
1. Turbo-saving to play catch-up in your 50s. Close the cash register and make the demands of your adult family come from one salary. Save the other salary in full.
2. Downsize your home and transfer equity to your fund.
3. An inheritance can add a gush of money of two-to-three times your salary depending on family size and wealth. Invest it.
4. Eat the family bach before you actually sell it. This is achieved by modelling the sale into retirement cashflows at a future date, allowing your retirement income to rise, while still enjoying the use of the asset.
5. Continue to work part-time.
6. Rent out non-performing assets, for example your bach or part of your own home for Airbnb.
This involves seeing a financial adviser to twist the levers of risk, probability and cashflow to calculate your personal comfort level. Go do it your way, Frank would approve.
Janine Starks is a financial commentator with expertise in banking, personal finance and funds management. Opinions in this column represent her personal views. They are general in nature and are not a recommendation, opinion or guidance to any individuals in relation to acquiring or disposing of a financial product. Readers should not rely on these opinions and should always seek specific independent financial advice appropriate to their own individual circumstances.