Whether or not it is years or months away it is never to early to start thinking about what sort of lifestyle you are going to want in retirement. And then to get an idea of how you are tracking towards reaching that ideal lifestyle. One of the many questions is how much money will I need to retire? The following article should start to get you thinking about how you are tracking.
A question I am often asked is how much money will I need to be able to retire? A very good question but a bit like how long is a piece of string.
There are many factors that will influence how much you need. Just a handful of them are:
- Will you have you got any debt you are still paying off?
- Do you own your home debt free or are you a renter?
- Will you qualify for the Age Pension from Centrelink?
- How much do you think you need each week to live a comfortable life?
- Do you have any big ticket or bucket list items that you need to pay for?
- Where will you holiday and how much is that likely to cost each year?
- Etc, etc,
But we all need a starting point so here is some information about likely lump sum requirements. This is based on generating income in retirement for 30 years with cost of living increases each year of 2.5%. I have assumed an earning rate on the money of a very conservative 5% a year.
Follow the link for the table to give you an idea.
Remember this lump sum can be made up of anything that is an investment. Super, property, shares, cash, as long as it is an income producing asset or one that allows you access to lump sum capital. That is why you would generally leave out the value of the family home.
How are you tracking? Do you even know?
I can offer you a no obligation review of your current situation to see how you are tracking towards your retirement. To find out more just call, shoot me an e-mail or give me a call.
How much will I need to retire.pdf
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