Retirement
Five steps to retiring at 55
An early retirement is often considered the “holy grail” and a “fast track to endless leisure”, but with growing life-spans, is it really possible?
Five steps to retiring at 55
An early retirement is often considered the “holy grail” and a “fast track to endless leisure”, but with growing life-spans, is it really possible?
State Custodians argues that it is, but not without some hard work.
“Retiring at 55 is possible if you do your homework. But do it for the right reasons,” the non-bank lender advised.
“Don’t retire early just because you don’t like your job. It’s better to retire into a life that inspires you, rather than retiring just to get away from a life you dislike!”
The home loan provider offered five tips to help hopeful early-retirees make it happen.
1. Plan, plan, plan
It’s important that pre-retirees are honest about the lifestyle they’re dreaming of, and question whether a longer retirement with a poorer standard of living is really worth it, State Custodians said.
“Write a plan containing your goals, savings capabilities, timelines, and cash flow streams such as superannuation and investments. Read up extensively on the subject and consider consulting a financial planner.”
2. Clean up bad debts
Warning that those with bad credit card debt could “end up working longer than the Queen”, State Custodians advised pre-retirees get their debt in order.
For those with multiple credit cards, this could mean cutting up the cards with the highest rates and paying those down “asap”. Pre-retirees should also consider living with just one credit card or none at all.
“Get a low interest rate card and whatever you do, don’t just pay off the minimum.
“If you’re royally in the red, consolidate all debts into a personal loan which generally offers better interest rates than credit cards or sign up for a debt agreement.”
3. Pay off that mortgage
Arguing that “no one wants to be stressed out at the bowling club, still thinking about a house”, State Custodians said mortgage holders should throw “as much spare cash as you can at your mortgage”.
Further, hopeful pre-retirees should think about a fortnightly repayment plan.
Senior manager Anouska Linz explained: “If you pay 26 payments per annum rather than 12, you’re getting ahead because you’re making more payments, chipping away at the interest.”
4. Invest in property, super or shares
“You’ll never retire at 55 simply by stashing cash under the bed,” the lender said.
Pre-retirees should weigh up the pros and cons of buying an investment property, purchasing some shares through a “trusted wealth management organisation”, or boosting super payments.
“Make sure your [super] fund is a good performer,” the lender advised. “If your super’s barely risen, consider switching funds.”
Additionally: “Contribute more than the standard 9.5 per cent employer contribution. If you’re nowhere near 55 then if you put in an additional $50 a week, the benefits by the time you’re 55 will be significant.”
5. Stop spending, start saving
Those looking to retire at 55 should be saving “furiously” by switching spending habits from “wants” to “needs”.
“Cut back on everything. Spend less on groceries, shop at cheaper stores, find economical service providers and eat at less expensive restaurants.”
Retirement Planning
How to adjust your wealth strategy during COVID
Investors are being urged to be conservative about spending, reduce debt and be careful of assets that are supported by government spending, as they look to adjust their wealth strategies during the f...Read more
Retirement Planning
Should older Australians downsize their property?
Older Australians face the dilemma of not being confident about their retirement outcomes, but are among the wealthiest retirees in the world due to a large proportion of their wealth being tied up i...Read more
Retirement Planning
Self-funded retirees ‘hung out to dry’ by 2020 budget
The Association of Independent Retirees has slammed last night’s federal budget release, accusing the government of overlooking older Australians in its post-COVID-19 recovery plans. ...Read more
Retirement Planning
Work backwards and buffer: How to set (and stick to) financial goals
Working backwards is one of the most effective ways for individuals to set financial goals that actually work, according to a finance director. ...Read more
Retirement Planning
What are self-funded retirees most worried about in 2020?
The national economy, the value of investments and the ability to manage long-term finances are top of mind of self-funded retirees reeling from the effects of a worldwide economic slump. ...Read more
Retirement Planning
Boost your super in the comfort of your own home
There’s a new way for retirees to top up their super through the downsizer contribution without having to move out of their home – and it’s got the approval of the ATO. ...Read more
Retirement Planning
How you’ll retire depends on personal values as much as dollars
Ever wondered why some people accumulate more wealth than others, even when their incomes are on par? It probably stems from their personal values, writes Helen Baker. ...Read more
Retirement Planning
Intergenerational wealth gap grows to 2-decade high
Falling rates of home ownership, government spending skewed to older Australians and deteriorating environmental factors are causing intergenerational wealth to grow, new research has shown. ...Read more
Retirement Planning
How to adjust your wealth strategy during COVID
Investors are being urged to be conservative about spending, reduce debt and be careful of assets that are supported by government spending, as they look to adjust their wealth strategies during the f...Read more
Retirement Planning
Should older Australians downsize their property?
Older Australians face the dilemma of not being confident about their retirement outcomes, but are among the wealthiest retirees in the world due to a large proportion of their wealth being tied up i...Read more
Retirement Planning
Self-funded retirees ‘hung out to dry’ by 2020 budget
The Association of Independent Retirees has slammed last night’s federal budget release, accusing the government of overlooking older Australians in its post-COVID-19 recovery plans. ...Read more
Retirement Planning
Work backwards and buffer: How to set (and stick to) financial goals
Working backwards is one of the most effective ways for individuals to set financial goals that actually work, according to a finance director. ...Read more
Retirement Planning
What are self-funded retirees most worried about in 2020?
The national economy, the value of investments and the ability to manage long-term finances are top of mind of self-funded retirees reeling from the effects of a worldwide economic slump. ...Read more
Retirement Planning
Boost your super in the comfort of your own home
There’s a new way for retirees to top up their super through the downsizer contribution without having to move out of their home – and it’s got the approval of the ATO. ...Read more
Retirement Planning
How you’ll retire depends on personal values as much as dollars
Ever wondered why some people accumulate more wealth than others, even when their incomes are on par? It probably stems from their personal values, writes Helen Baker. ...Read more
Retirement Planning
Intergenerational wealth gap grows to 2-decade high
Falling rates of home ownership, government spending skewed to older Australians and deteriorating environmental factors are causing intergenerational wealth to grow, new research has shown. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
