Retirement
Five small steps to save money for retirement
Retirement is a major milestone in everyone’s lives. However, the idea of planning and saving can be tedious for those who are decades away from it.
Five small steps to save money for retirement
Retirement is a major milestone in everyone’s lives. However, the idea of planning and saving can be tedious for those who are decades away from it.

Despite the large amount of money experts say a person needs during retirement, there’s no reason to become intimidated. Every journey begins with a single step—and this applies to saving for retirement as well.
Here are five simple steps that anyone can take at any age to save money for retirement.
- Start with a simple plan
- Avoid triggering penalties
- Maximise your super fund
- Make additional contributions to your fund
- Seek advice
Step 1: Start with a simple plan
Saving for a goal 25 or 30 years down the line isn’t exactly exciting despite the promise of financial independence. Instead of starting off with the prolonged delayed gratification, consider breaking down savings goals to shorter terms.
Instead of thinking about how you can save $1 million in 25 years, you may break the goal down to $40,000 annually, $3,333.33 monthly or $833.33 weekly savings. A $119.05 daily saving may seem high for some, but here’s the thing: you don’t really have to stick to these numbers to reach $1 million in 25 years.

Try to regularly set aside an amount close to your daily or weekly goal and deposit the money in a high interest savings account until it is enough to finance a smart investment. After that, regularly add these savings to the principal investment and allow time and interest to compound your money.
Invested money will grow in due time as long as you invest early and utilise a smart investment strategy.
Step 2: Avoid triggering penalties
Another way to save money is to avoid transactions that incur fees or penalties, such as late bills payments. Paying bills on time and avoiding fees may not seem like much, but penalties can add up if it becomes repetitive.
Likewise, it’s best to control spending using credit cards if you can’t pay in full on each billing period because interest charges can compound.
Consider automating the payment process to avoid triggering penalties.
Step 3: Maximise your super fund
When it comes to managed funds, the only thing an investor can really control are the fees they pay the manager and the choice of fund.
Investors may consider assessing their current fund manager’s performance to determine whether the fees they charge are worth paying.
Step 4: Make additional contributions to your fund
The superannuation system requires employers to make salary guarantee (SG) contributions equivalent to 9.5 per cent of their employee’s ordinary wage; however, retirement benefits could grow larger with additional contributions.
Consider matching the SG with a salary sacrifice or post-tax contributions. Even low-income earners can benefit as salary sacrifice may be eligible for government co-contributions.
Step 5: Seek advice
Personal circumstances and the economic climate can change anytime so it’s best to consult a licensed professional to determine the best strategy for your retirement goals.
Explore Nest Egg for more retirement saving tips.
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