Add articles to your saved list and come back to them any time.<\/p>\n
I own my home and an investment property. I have $220,000 in super and am 54 years old. I work full-time on an average wage. I also have shares valued at $100,000. <\/b>With my assets and age, what should I be focusing on to retirement?<\/b><\/p>\n
How much income will you require in retirement? Start by determining how much you are spending now, and then reflect on how that might change in retirement. Often, we find people spend more in the early years of retirement whilst they are fit and able to travel, and then that spending plateaus or declines in the latter stages of life.<\/p>\n
<\/p>\n
Once you work out how much you\u2019ll want to live off in retirement, it will make planning much easier.<\/span>Credit: <\/span>Simon Letch<\/cite><\/p>\n With your target retirement income determined, you can then consider whether the rental income from your investment property and the income to be drawn from your superannuation are likely to cover this need. Potentially, after age 67, an age pension may help cover your living costs, but the value of the investment property is likely to have a significant impact here.<\/p>\n I suggest you jump on the government\u2019s Money Smart website and play with some of the retirement calculators they have there to help you understand when retirement might be feasible.<\/p>\n An extra year\u2019s employment has a disproportionate impact on the longevity of your retirement savings. We typically see a three-to-one ratio here \u2013 that is, for one extra year\u2019s work, your retirement savings last an extra three years.<\/p>\n I don\u2019t believe my employer has ever contributed to my super. What should I do?<\/b><\/p>\n Your employer has a legal obligation to pay you Superannuation Guarantee, which is currently 11 per cent of your pre-tax wage. Check the transaction listing for your super fund.<\/p>\n Contributions should occur at least every three months. If there are no payments, you should report the matter to the ATO via their website. They will chase up your entitlements.<\/p>\n I am 58 and wish to retire at 60. I will have about $1.1 million in super and a mortgage of $420,000. My wife is 55 and will have about $450,000 in super at age 60. <\/b>Would we be best advised to fully discharge our mortgage upon my retirement via a withdrawal from my super?<\/b><\/p>\n Owning your home debt-free in retirement is psychologically desirable and financially sensible. It is the case that Australia\u2019s superannuation system permits lump-sum withdrawals once you are over 60 years of age and retired.<\/p>\n What you really need to understand is whether the remaining superannuation savings for yourself and your wife will be sufficient to provide you with a comfortable life. It would be worth getting some financial modelling done to answer this question.<\/p>\n It may be, for instance, that you need to work a year or two longer so that the hit to your super fund is less. It very much depends on what your expected living expenses will be in retirement and the other things you might hope to do, such as travel.<\/p>\n So the answer to your question is that it is possible, but whether you would be \u201cbest advised\u201d to take this course of action is impossible to say without more detailed number crunching.<\/p>\n Paul Benson is a Certified Financial Planner, and host of the Financial Autonomy podcast. Send your questions to: paul@financialautonomy.com.au<\/strong><\/p>\n