Retirement is a significant milestone that deserves celebration, but planning carefully is essential to ensure a financially comfortable retirement. By taking action now, you can support yourself in the future and enjoy your retirement to the fullest.
Calculating how much money you’ll need and planning accordingly to achieve a comfortable living standard in retirement is necessary. Preparing for retirement requires careful planning to ensure a comfortable life stage ahead. Since you’ll be retired for many years, enjoying that time is essential.
Regardless of how close or far away retirement may be, there are steps you can take now to prepare. Planning means you can tailor your retirement to your needs and goals.
Below are some stats on the average income for retirees in Australia in 2023.
What is your retirement goal?
When it comes to preparing for retirement, the first step is to identify your retirement goals. What kind of lifestyle do you envision for yourself during retirement? How long do you anticipate being retired? What activities do you hope to pursue during this time? Once you clearly understand your goals, you can begin to develop a plan to achieve them.
It’s important to bear in mind that people are living longer than ever before, which means that we need to ensure we have enough funds to last us throughout retirement. Planning ahead is crucial in order to secure a steady income stream and avoid stress during this period of our lives.
It’s never too early to start planning for retirement; the more time we have to prepare, the better off we will be. Moreover, we need to be ready for the possibility of early or unexpected retirement due to factors such as retrenchment or illness. In such cases, having a solid retirement plan in place can make all the difference.
Determine an Ideal Retirement Age
Planning for retirement involves more than just choosing the year you want to stop working. It also involves determining when you can afford to retire. The earlier you start preparing for retirement, the better your chances of achieving your desired retirement age.
Although the average life expectancy in Australia is 85 for women and 81 for men, it’s important to plan for the possibility of living to 100 or beyond. In Australia, the retirement age is linked to a person’s eligibility for the age pension. Recently, on 1st July, the retirement age increased to 67 years old for those who were born on or after 1 January 1957.
If an Australian woman were to retire at 67 and live until the average age of 85, she would need to rely on her savings, investments, and superannuation to support herself for 18 years. However, retirement plans vary widely, with some individuals choosing to retire before 67 while others continue working well into their golden years.
To plan for retirement, you need to determine when you want to retire and calculate the resources required to finance it.
| Statistic | Value |
|---|---|
| Proportion of Australians with annual incomes < $140,000 | 99% |
| Age Pension | |
| – Single Individuals | $27,664 annually |
| – Couples (including supplements) | $41,704 annually |
| Average Income for a Comfortable Retirement (Couples) | Approximately $85,000 yearly |
| Account-based Income Streams | |
| – Most Popular Option | |
| – Average Annual Payment | $19,490 |
| Annuities | |
| – Number of Retirees using Annuities | About 100,000 |
| – Average Annual Income | $45,943 |
| Association of Superannuation Funds of Australia | |
| Retirement Standard | |
| – Income Required for a “Comfortable” Retirement (Couples) | Approximately $71,500 annually |
| – Income Required for a “Comfortable” Retirement (Single) | Greater than $50,000 annually |
