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Are you ready for retirement?

Are you ready for retirement?

The latest research has revealed that most Australian’s are confused and unprepared about their future after work. Which is why it’s vital to plan ahead early and be ready for retirement, so you can live your later years stress free and doing the things you had always dreamed of.

This is especially true for baby boomers as 86 per cent have admitted they are financially unprepared and only one in five have saved enough for retirement. It is also relevant to the younger generation as almost half do not have a good understanding about their retirement savings.

Galaxy research recently surveyed 1500 Australians and discovered that on average they believe they would need about $3700 per month to live comfortably and achieve their dream retirement which included:

• Indulging in whatever foods they wanted (57 per cent)
• Regularly travel to socialise with friends (55 per cent)
• Dine out once a month (50 per cent)
• Take an annual holiday within Australia (49 per cent)
• Buy a new car (45 per cent)
• Travel overseas every one to two years (41 per cent)
• See a live show/event 2-3 times a year (32 per cent)
• Renovate their kitchen or bathroom (19 per cent)

However it has been found that at least $4700 a month will be required to afford this desired lifestyle, 26 per cent higher than what is assumed.

You do not want to be unsure about how much you should be saving as you could be in for a shock when you decide to call an end. It is best to start planning as soon as possible, regardless of age or retirement plans. The ABS suggests men should plan for 21 years of retirement and women 24 so there is plenty of time to account for. Begin by devising a budget and thinking of extra ways you could add to your superannuation now, as compound interest can make a big difference in the long run. To understand how much you will need, imagine everything you want to achieve such as travel, healthcare and purchases.

Some common problems that restrict your end balance include having more than one super account, not choosing the right investment option, paying too much in administrative fees and ignoring the tax benefits built into super. If you are need assistance resolving these issues a financial planner can help and lead you on your way to an enjoyable life after work.

The earlier you start the better off you will be which is why it is recommended you seek professional advice from financial planners on how you should prepare for life after employment. Call us on (08) 9289 7777 and we will recommend an expert.