While retirement should be the best years of your life, many Australians make simple, avoidable mistakes with their finances that can leave them dependent on the age pension and without the funds to give them choices.
However, with some simple good advice at the start of retirement, these mistakes can usually be avoided, leaving retirees to focus on what is really important and that is, simply enjoying life.
๐๐๐ซ๐ ๐๐ซ๐ ๐ฌ๐จ๐ฆ๐ ๐จ๐ ๐ญ๐ก๐ ๐ฆ๐๐ข๐ง ๐๐ซ๐๐๐ฌ ๐ญ๐จ ๐๐จ๐ง๐ฌ๐ข๐๐๐ซ:
๐๐๐ค๐ข๐ง๐ ๐๐ฆ๐จ๐ญ๐ข๐จ๐ง๐๐ฅ ๐ข๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐๐๐๐ข๐ฌ๐ข๐จ๐ง๐ฌ
Many people reach retirement age and panic that they donโt have enough money. This then prompts them to make high risk investments in the vague hope of catching up on lost time.
Too often their dreams of big profits blinds them to risks and many end up losing a chunk, if not all, of their money. All retirement savings are irreplaceable and should be invested with this in mind.
๐๐ ๐ง๐จ๐ซ๐ข๐ง๐ ๐ฒ๐จ๐ฎ๐ซ ๐ฉ๐จ๐ซ๐ญ๐๐จ๐ฅ๐ข๐จ
At the other end of the spectrum are retirees who think they have so little saved for retirement that it doesnโt matter what they do with it, in terms of their investments, it wonโt make any difference to their lives.
This is almost as big a mistake as taking excessive risks. No matter how much money you have saved for retirement, you should be proactive in making sure these funds are safely invested and providing for you.
๐๐ข๐ฌ๐๐๐ฅ๐๐ฎ๐ฅ๐๐ญ๐ข๐ง๐ ๐ฒ๐จ๐ฎ๐ซ ๐ซ๐๐ญ๐ข๐ซ๐๐ฆ๐๐ง๐ญ ๐๐ฎ๐ง๐๐ฌ
Many misjudge either the total amount they have to retire on, and/or, the level of income their nest-egg will generate. This is particularly the case when the decision is made to keep an investment property in retirement.
The high value can often give a false sense of financial security, while the actual income generated after all the costs are deducted, can be extremely low.
Tips:
1 ) Determine just how much money you have saved for retirement
2) conservatively judge how much income will be generated from those savings,
3) and ensure you donโt spend more than your investments generate.
๐๐ก๐๐ง๐ ๐ข๐ง๐ ๐๐ฌ๐ฌ๐๐ญ ๐๐ฅ๐ฅ๐จ๐๐๐ญ๐ข๐จ๐ง๐ฌ ๐ญ๐จ ๐๐จ๐ง๐ฌ๐๐ซ๐ฏ๐๐ญ๐ข๐ฏ๐ ๐๐ฌ๐ฌ๐๐ญ๐ฌ, ๐ฌ๐ฎ๐๐ก ๐๐ฌ ๐๐๐ฌ๐ก
For many, retirement is the first time they have had to manage or decide how to invest a large amount of money. This can be unnerving at the best of times. Throw in a small market downturn and it is not unusual for people to panic and sell perfectly good investments.
This is, of course, the worst option. By panicking and selling investments when the market has taken a step down, losses are locked in and any chance of recovering those funds as the market improves, is lost.
๐๐๐๐ฉ๐ข๐ง๐ ๐ฎ๐ฉ ๐ฐ๐ข๐ญ๐ก ๐ญ๐ก๐ โ๐๐จ๐ง๐๐ฌ๐๐ฌโ
Too often, weโre swept along by what others do. Focus on how you want to live. Think about what will make you happy in retirement and then invest your savings safely so you can focus on enjoying life.
For most, the things that make them happiest are free. Time spent with family and friends, walking barefoot on a beach, nourishing the mind and soul with books, or spending time in the garden, all cost very little money and are a fabulous boost to the body, health and mind.
If you have any doubts at all about how you should structure your finances, make the decision to get quality advice before you make any of these mistakes. It will be the best investment you make in retirement.