Are You Sitting or Standing When It Comes To Your Retirement Planning?

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Picture yourself at a seminar where the presenter gets the whole group to stand and then asks the following things:

Stay standing if you have a super fund

Stay standing if you are happy to rely solely on the age pension in your retirement

Stay standing if you can tell me the balance of your superannuation fund without looking at your statement.

Would you be sitting or standing?

For the majority of people, the answer would be sitting, meaning that most people do not see the age pension as sufficient to meet their desired lifestyle needs in retirement, however have no idea what is going on with the key asset that can make their retirement dream a reality.

For most people the thought process when it comes to superannuation is that the contributions being made by their employer will give them enough to meet their retirement needs, and really it is a set and forget strategy (if they even get around to ‘setting’ it all).

When we look at the reality though the numbers paint a very different picture.

Consider this:

A person works for 30 year

Earns $65,000pa.

The employer will contribute $6,175pa (9.5% of Salary)

The fund returns 5%

At the end of 30 years that employee will have balance of $410,259, however this balance excludes the following:

Tax – $61,588

Fees 1% – 54,338

Insurance premium – $100,000 over life of the fund

Leaving a balance of $194,000 to actually fund their retirement.

How long would this last you?

Your superannuation is going to be a key asset in your retirement planning and is something that needs to be looked at and reviewed on a regular basis to ensure it is on track to meet your retirement goals.

It’s probably time to look at your balance isn’t it?


Author: Sarah Lockwood