How To Prepare For Your Retirement

18:19' 10-05-2017
Australia’s superannuation system is one of the largest in the world, with approximately $2 trillion in assets. However, research reported by Wade Matterson for financial consultants Milliman a year ago shows that a majority of Australians are still significantly unprepared for retirement.

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    Based on Australian Bureau of Statistics data from 2011-2012, the average super balance at retirement is $197,000 for men and $105,000 for women. However, Matterson estimates the average couple needs just over $500,000 to live comfortably in retirement.

    This means that although the average Australian expects to spend approximately 23 years in retirement, their money will run out after only 10 years, leaving them to live off a meagre pension for the rest of their lives.

    Why are Australians so unprepared for retirement?

    Zaki Ameer, Property Investment Expert and Founder of Dream Design Property (DDP) says many people wrongly believe that their standard superannuation contributions will be enough to live off when they reach retirement age.

    “In today’s market investing is almost essential to ensure a person is financially supported throughout their retirement,” Zaki says. “Without investment assets, the average couple’s super balance at retirement is over $200,000 short of what they need to live on comfortably.”

    Investing and making regular contributions to one’s superannuation fund is recommended from as early as possible, ideally during one’s 20’s, Zaki says. But even if you haven't done this, it is still possible to catch up, “even as late as 50s”.

    To help ensure you are prepared for retirement, Zaki has some expert advice:

    • Pay off your highest interest credit card balances first, and use the money freed up to accelerate the payoff of the remaining cards.
    • Know that one investment is not enough to retire on, so the earlier you start the better. For example, in property investment you would need 10 properties worth $300,000 each, for at least 10 years, to build up enough to retire on a $100,000 per annum passive income.
    • Capitalise on what you could earn money from, such as extra space in your house or office, or equipment or services, that you could rent out. 
    • Invest any pay-rise or bonus you receive, instead of rewarding yourself with extra expenses, as many people do.
    • Speak to a financial advisor to set up income, disability, life and trauma insurance, to provide financial protection for yourself, your portfolio and your retirement fund.

    DDP is a wealth creation mentoring program designed to help Australians gain financial freedom, offering ongoing personalised service. For more information please visit

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Keywords: australian bureau of statisticsretirementsuperannuation system

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