Whether buying a first car, a house or saving to retire, it’s important to know the best ways of getting the most from your savings and how much money you need.
Saving for retirement depends on your age and intended lifestyle.
Most retirees need more income in their first years of retirement because these are often when they decide to travel or pursue hobbies. As they age, their lifestyle slows down and less income is required.
One way people can boost their nest egg is to make extra contributions to their superannuation each week before retiring. Although this will decrease take-home pay during that time, it will make a difference later on.
The Association of Superannuation Funds of Australia (ASFA) estimates a couple looking for a comfortable retirement needs $58,326 a year.
Those seeking a ‘modest’ retirement lifestyle will need $33,784 a year.
For singles, a modest retirement will cost them $23,489 a year or $42,597 a year for a comfortable retirement.
The ASFA refers to a modest lifestyle as better than living off the pension but still only able to afford fairly basic activities.
Meanwhile, the ASFA says a comfortable lifestyle allows for the retiree to be involved in a range of leisure activities and have a good standard of living, including private health insurance, a reasonable car, domestic and, occasionally, international travel.
Upcoming retirees who are unsure of their budget and the best way to get the most from their money can contact a financial advisor for professional advice.
Be sure to choose someone who holds an Australian financial services licence.
… By Rebecca Miller
For more information on saving for retirement visit: www.moneysmart.gov.au/superannuation-and-retirement
