I am constantly on about the need to have a plan to be financially fit enough to enable a comfortable retirement.
We see so many baby boomers who have not planned and are stunned by the realization of HOW FINANCIALLY UNFIT THEY ARE for what they will need for a comfortable retirement.
HOW WOULD YOU LIKE TO HAVE TO LIVE ON A CAPITAL SUM OF $300000 OVER THE NEXT 20 YEARS?
How hard it is to have to change your lifestyle dramatically to resort to what is termed by the Federal Government as a ‘modest retirement’.
Add to that the fact that one third of all Australian women have no superannuation and those who do have it are considerably underfunded. The average payout for men in 2011-2012 was $197000 and for women $105000. Source ASFA
Looking further into the future we are all living longer and what used to be – retire at 65 with a life expectancy to age 74 – is now a life expectancy for males of 82.
Here’s the rub. We are becoming physically fitter to live a longer life but most of the population may be FINANCIALLY UNFIT to finance it. There will be 10000 Australians over 100 by 2030.
A ‘comfortable’ lifestyle at retirement is described as ;
Enabling an older, healthy retiree to be involved in a broad range of leisure and recreational activities. To have a good standard of living through the purchase of such things as household goods, private health insurance, a reasonable car, comfortable clothes, a range of electronic equipment and domestic and occasionally international holiday travel.
Source: ASFA March 2014.
The big question to be answered is how much and for how long?
- To secure $65,000 p.a. income after tax today in retirement, you will need at least $1million in savings
- 19% of Australians would last one week on savings.
- 45% of Australians would last four weeks on savings.
- Only 23% could last more than one year.
- 10% have a net worth over $500,000.
- 5% have over $5 million worldwide.
HOW MUCH IS ENOUGH?
- How much in tomorrow’s $?
- Relaxed lifestyle.
- Be able to help the kids or grandkids.
- ‘Grey nomads’ touring around Australia, or just having the odd holiday.
- Occasional overseas trip.
- Car upgrade every five years.
- Simply being debt free?
To retire at age 60 on $23000 p.a. or age 65 on $26000 p.a. requires a capital sum of $300000
To have a sum of $75000 p.a. at age 60 requires $1000000 or retire at age 65 $85000 p.a. requires $1000000.
Who knows what today’s dollar will buy in 20 or 40 years time.
So, no matter what age you are create a FINANCIALLY FIT PLAN for you and your family when you retire.
HOW TO CLOSE THE GAP BETWEEN WHAT YOU HAVE UNDER CURRENT PLANNING AND WHAT YOU NEED AT RETIREMENT
Accept that there is a gap and confirm that it needs to be filled or else!
Understand that any strategy to close the gap will involve discipline and a well thought out plan
Seek advice as to the possibility or potential, given your time frame, of the wealth creation options available to you to secure the right assets to provide the return required to achieve the goal of a ‘comfortable lifestyle at retirement’.
- Stock market
- Mutual Funds
- Term Deposits
- Government bonds
- Cash savings
90% OF RETIREMENT PLANNING FAILS
Because they did not seek the advice of professionals who can offer guidance at the time of planning and they failed to enrol all of those who could make it happen
- Family members
- Financial advisor
- Potential lenders to determine their short and long term capacity to borrow and repay
- Where property was involved they failed to gain experienced professional advice – reverting to relatives and friends for advice on what and where to buy investment property.
- The plan was not SMART – Specific, Measureable, Achievable, Relevant to future needs, Time bound
Regardless of your age – you may never develop another plan as important to your life and that of your loved ones as the FITNESS FOR RETIREMENT plan. The key to success is discipline.
Our role is to assist our clients who have not developed a plan to set their direction and to make informed choices. If property emerges as the MAIN OPTION AVAILABLE TO THE AVERAGE FAMILY (and it more than likely will) they pay a deposit and their two rich uncles – UNCLE ATO and UNCLE TENANT pay up to 90% of the cost.
We meet with clients initially on 3 occasions;
|Stage one||Discussing retirement and/or other financial milestones. Allowing our consultant to fully understand their wealth creation objectives and their planning if that exists
Measuring their financial situation and capacity to determine the most suitable property financing strategy in conjunction with their accountant and a licensed mortgage broker or lender.
- Will an SMSF be used to purchase the investment property?
- Will the property be purchased jointly?
|Stage two||Understanding how the development of the right FITNESS FOR RETIREMENT strategy and choosing the right property can make a major contribution to their financial security.
Confirming the FITNESS and property strategies with their accountant or financial advisor.
|Stage three||Choosing an investment property suitable to their financial situation and life objectives now and into the future.|
Meredon is an experienced (over 45 years) well established consultancy in the development of individual property wealth creation strategies.
When you consult with us you are given a guarantee of absolute confidentiality and an assurance that you become a client for life – not just for this property but for the successful achievement of the goals created in your FITNESS property wealth creation plan.
TAKE ACTION NOW REQUEST A FREE CONSULTATION
Go to our website www.meredon.com.au fill in the ‘contact us’ form using the word ‘consultation’ or call 1300680323 mobile 0404456428 for further information.
A Consultant will respond immediately to arrange a suitable free appointment to set your direction through making informed choices.
Thanks for joining me today
Don Duncan F.A.I.M.
Don is the Principal Consultant at Mediwealth Australia, with over forty years experience in developing successful residential property investment strategies, and extensive experience in the financial sector, Don is uniquely qualified to provide you with the best property investment advice available. He is supported by experienced property investment consultants in both Brisbane and Sydney.