You Don't Need a Long Neck - To Fund Retirement.

Our retirement income philosophy in a couple of paragraphs.

There are many lifestyle and financial changes that occur at retirement. Whilst you will have increased leisure time, you will no longer be earning an income from work activities. As a result most people during retirement will live off their investment income, or their savings. The amount of income received in retirement will depend largely on the level of accumulated wealth obtained during your working years.

There are many ways to accumulate wealth for retirement. The most popular and generally the most tax effective way is through superannuation. This vehicle becomes even more tax effective at retirement when an income from your savings is required to fund your lifestyle. Of course, there is also the ability to receive income off other investments outside of superannuation.

For many Australians the income received from their assets will not be sufficient to meet their desired retirement income which can impact on their lifestyle goals. Generally speaking, most Australians will need to draw down on their accumulated savings to supplement their income needs. The aim is to have your capital last for as long as possible during this time.

A lot of Australians will rely on the Government for financial support at some point in their retirement years. This usually comes in the form of the Centrelink Age Pension.

It is not possible to predict what changes might occur to eligibility rules for the Age Pension over the years , but given Australia’s ageing population it is probably safe to say they are unlikely to become more lenient than they are currently. It is therefore important that you aim to fund as much of your retirement income from your own investments as possible and not rely too heavily on the Age Pension.

This article first appeared as a post on LinkedIn and the content itself is taken from the Adviserlogic Retirement Calculation report. It sums up our retirement income philosophy succinctly and allows us to focus on getting small business owners and professionals retirement ready so they never worry about money in retirement.