Retirement Planning

Preparing for Retirement: What Should Your Priorities Be?

Everyone wants to have a comfortable lifestyle during their retirement years. This is why it’s vital to make the proper preparations early in the planning phase.

However, retirement planning is a big task with a lot of moving parts so it can be difficult to know where to start and what the most important components are.

Whether you’re just starting to think about retirement or you’ve already got a financial plan in place, here’s how you can feel confident about your financial future.

What Should Your Retirement Priorities Be?

It’s important to remember that planning for retirement involves a lot more than just saving money. 

Saving for retirement and building up your super fund is one part but what’s even more essential is understanding if the money you have will be enough.

Here are four things you might want to consider so you can achieve a comfortable and sustainable retirement.

Your Retirement Budget

Many people think their budget during retirement will be the same or even less than their regular budget. After all, you’ll no longer have to pay for petrol or work-related expenses. Plus, if you own your house – you won’t have to pay off the mortgage or account for rent. 

But you do need to consider the other expenses in retirement – from the everyday living expenses, to expected medical costs, to the holidays you want to take. 

When you retire, you’re suddenly gifted with an enormous amount of free time. But if you want to spend that time doing things that you love – like travelling, spoiling your family, or playing golf on the weekends – you need to map out a proper budget. 

Pre-Retirement Debt Management

Many retirees aim to pay off all their debts before they retire. This can be an enormous weight lifted off your shoulders.

However, a debt-free retirement isn’t possible for everyone. Some retirees still have a mortgage to pay off or a personal loan. However, if you are approaching retirement with debts, you should absolutely have a debt management plan in place. 

While it’s great to contribute savings to your super for tax benefits, there are times when paying your debt should be your first priority. These instances where you’ll have to choose between one or the other will seriously impact your wealth management strategy.

Superannuation Contributions

As mentioned above, contributing to your super is a great step to build your retirement savings. 

You have the option to contribute a lump sum of your money at any time in your life (subject to age and work test eligibility after age 67). These are called non-concessional contributions or after-tax contributions. 

Alternatively, you can choose to salary sacrifice some of your regular salary. This is called making concessional contributions. The latter option may offer significant tax benefits while also allowing you to build up your nest egg. 

Find out more about concessional contributions in this article.

Estate Planning

It’s a common misconception that estate planning is only for the very old or very wealthy. 

In reality, many Australians draft an estate plan as early as their 30s. This is because it’s important to have a structured document detailing your ability to pass your wealth to your loved ones and beneficiaries. 

Plus, it can often make sense to include this as part of your retirement plan if you are organising your finances and assets – including your superannuation.

Balancing Your Time

Planning for retirement isn’t all about managing your financial assets; you also need to consider how much time you want to spend best optimising your finances. 

As we mentioned before, building your retirement plan is a big job. And can take up a lot of your time – both now and as you continue to monitor your finances during retirement.

Like anything in life, it’s important to find the right balance. 

How much time and effort do you want to spend creating an effective retirement plan you can rely on?

How much time do you want to spend educating yourself on complex financial topics to help you secure your financial future?

If your answer is “as little as possible”, I don’t blame you! The best way to spend more time “in” life rather than planning for life is to hire a financial planning expert. 

At Leo Wealth, we can help you navigate your retirement planning with ease. When it comes to wealth management, we can help you create, build, and protect your finances for you and your family. 

We offer retirement financial planning and other wealth management services to help our clients feel secure with their future. 

If you want to take the right steps to financial independence, book an appointment with our financial advisors today!