It is never too early or too late to start planning for your retirement. Retirement is the time to enjoy the fruits of your many years of labour, not a time to scrimp and save. You need to make sure you have enough savings in your superannuation to make your retirement a comfortable one.
Which raises the question: how much is enough?
The amount of annual income you’ll need in retirement is completely personal and depends on the lifestyle you want after you stop working.
As a general guide, the Association of Superannuation Funds of Australia estimates that a single person will need $42,433 per year, and couples $58,128 per year, to lead a comfortable lifestyle in retirement.
A ‘comfortable lifestyle’ is defined as one that allows an older, healthy retiree to maintain a living standard that includes purchasing household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, domestic holiday travel, and the occasional international holiday.
Prior to retirement, there are some important questions you need to ask yourself, including:
- What do you want to do in retirement?
- How much money will you need to do it?
- Do you need a regular income?
- Where will this income come from?
- When can you retire?
- How and when will you be able to access your super?
- What Government support will you be eligible to receive?