This article was written in collaboration with Private Client Adviser, Andrew Larkin.
1. How long will my retirement savings need to last?
Average life expectancy: As of 2024, the average life expectancy in Australia is 84 years. However, planning for a longer lifespan is prudent given advances in healthcare.
Longevity risk: How can I invest my retirement savings to ensure I don’t run out of money if I live beyond 90 or even 100 years?
2. How will inflation and cost of living increases impact my required retirement expenses?
Current Needs: According to the latest ASFA data for June 2024, couples aged 65-84 need a minimum of $73,337 per annum, and singles need $52,085 per annum to maintain a comfortable retirement. This reflects a significant increase from 2019, where couples needed $61,522 per annum and singles $43,601 per annum, representing a 19.2% and 19.5% increase, respectively.
Future Projections: With a 4.88% inflation rate, the cost of a comfortable retirement is projected to rise to:
- $93,064 per year in 5 years,
- $118,098 per year in 10 years,
- $149,867 per year in 15 years.
Sufficiency of Savings: Is my retirement savings balance sufficient to meet these rising income needs, especially considering recent cost of living pressures?
3. Do I want to leave an inheritance?
Capital Preservation: Can my portfolio be structured to generate enough income to meet my retirement expenses without depleting my capital, ensuring a legacy for my heirs?
4. Do I know what my superannuation is invested in?
Franking Credits: Am I receiving the full benefit of franking credits, effectively boosting my retirement income by up to 40%?
Portfolio Transparency: Is my portfolio transparent, and do I have a clear forecast of the dividend income I can expect each year?
Asset Classes: Am I aware of all asset classes available for generating retirement income, such as floating rate major bank capital notes and other income-generating investments?
5. Investment risks
Market Resilience: Am I confident that my portfolio can continue to provide the required income during market downturns?
Advisory Support: Do I have a trusted adviser I can consult to avoid making poor investment decisions during volatile periods?
Want a second opinion?
Contact us today to begin your journey with Morgans Gold Coast.
James Fulton-Kennedy
Financial Planner | Authorised Representative: 001237196
Andrew Larkin
Private Client Adviser | Authorised Representative: 000259115
