Financial advice boosts confidence in retirement

I found an article in MLC’s publication Hatch which found that Seventy-seven percent of Australian pre-retirees who haven’t enlisted the help of financial professionalsdon’t feel prepared for retirement.

This concerning statistic was revealed in MLC’s Australia Today report. Of the remainder, only 9% feel ‘prepared’ for retirement and only 14% consider themselves ‘somewhat prepared’ for retirement.

Some key excerpts from the article are outlined below.

  • With couples needing $58,922 per annum for a comfortable retirement and $34,064 per annum for a modest retirement, and singles needing from $23,000-$43,000 per annum for a modest to comfortable retirement, those who aren’t prepared will face a significant shortfall.2 Especially if you retire at 65 and live for 25 years.
  • Australians engaging the help of financial professionals are more than twice as likely to feel ‘very or fairly well prepared’ for retirement than those without a financial professional. They’re also 21% less likely to feel slightly or not at all prepared.
  • Those surveyed with financial planners or advisers are also 22% less likely to expect to rely on government support to ensure their financial security (52% with financial advisers compared with 27% without) and are 10% less likely to be relying on an inheritance to ensure financial security (77% with financial advisers compared with 67% without).
  • If you acknowledge that one day you’d like to stop working while still having control over your lifestyle, think about how much money you’d like each year and what that means as a lump sum. Engaging the help of financial professionals may help you put a plan in place to enjoy the lifestyle you want in retirement.
  • There are many great calculators online including ASIC’s MoneySmart retirement planner. You can also consider more actively managing your super, investigating and learning more about your investment options, risk/return considerations, and timeframes, while topping up your super when you can (depending on your tax circumstances) to boost your retirement savings.

If you would like to discuss further please feel free to contact me.GAP Financial.

All the best

Geoff Pacecca

Principal Adviser and Director

MLC and IPSOS, Australia today report, Aug 2016.

1 1647 of respondents surveyed by IPSOS.

2 ASFA Retirement Standard, March Quarter 2016.