{"id":6468,"date":"2021-06-21T12:02:15","date_gmt":"2021-06-21T02:32:15","guid":{"rendered":"https:\/\/adelaideprivatewealth.com.au\/retirement-planning-in-your-50s-choose-your-own-terms\/"},"modified":"2021-06-21T12:02:15","modified_gmt":"2021-06-21T02:32:15","slug":"retirement-planning-in-your-50s-choose-your-own-terms","status":"publish","type":"post","link":"https:\/\/adelaideprivatewealth.com.au\/retirement-planning-in-your-50s-choose-your-own-terms\/","title":{"rendered":"Retirement planning in your 50s: choose your own terms"},"content":{"rendered":"
Early retirement planning never hurt anyone.\u00a0A financial adviser Tuy explains the steps many of his 50-something clients take in order to make the best retirement plans.<\/p>\n
For financial adviser Tuy, financial advice isn\u2019t about making the most money all of the time. \u201cIt\u2019s about coming up with solutions and strategies to help you meet your personal goals.\u201d<\/p>\n
\u201cWhen people hit their 50s, those strategies are often around retirement lifestyle,\u201d he says.<\/p>\n
Tuy likens his role to planning a journey: \u201cSomeone asks you the best way to get to Docklands from Melbourne. You can run, drive, or jump on a bus or bike to get there. They\u2019re all viable and your adviser will help work out what\u2019s best for you, your budget, your family and your values.\u201d<\/p>\n
The statement of advice is the client\u2019s comprehensive game plan to achieve all the things they want to do. \u201cThere will be about 20 pages that are very specific to your situation,\u201d Tuy says. \u201cIt explains what you need to do to achieve your goals with various scenarios modelled \u2013 your current position versus your proposed position. If there\u2019s more than one valid strategy you\u2019ll be able to see them all, with an explanation of why one was chosen over the others.\u201d<\/p>\n<\/div>\n<\/div>\n
Heading towards retirement, Tuy says the client and adviser need to work out what levers to pull in the coming years. Key questions that need answering are \u201cwhat do you want your retirement to look like?\u201d and \u201cwhen do you want to retire?\u201d.<\/p>\n
According to Tuy, the answers vary enormously.<\/p>\n
\u201cThey might say, \u2018I want to continue living near my grandkids and\u00a0buy a caravan<\/a>\u00a0for long road trips\u2019. Or they might say \u2018I need $60,000 a year for the rest of my life\u2019. My job is to take all the things that require money as the basis of a smart retirement plan.\u201d<\/p>\n Tuy emphasises that the backbone of an effective financial plan is the client\u2019s cash flow, so his first step is to get a client to do an honest budget.<\/p>\n \u201cIt\u2019s my job to work out the details of what\u2019s possible. Once I understand your cash flow, I can work backwards from your goals. Basically, I make sure the client knows that if they spend just $x per week and invest $x per week for the next six years, they\u2019ll achieve the retirement they want,\u201d he says. \u201cIf they commit to that, the rest of the plan takes care of itself.\u201d<\/p>\n Our\u00a0budget calculator<\/a>\u00a0is another way of tracking your spending. In Tuy\u2019s experience, clients usually find living within their new budget very achievable: \u201cIt just takes some basic habit tweaking,\u201d he explains. \u201cIt could be as simple as deciding to put your future first. By that I mean every time you get paid, let\u2019s invest more or use some to reduce your debt. What\u2019s left over is your spending money.\u201d<\/p>\n Tuy points out that as a society, we do the opposite. We spend first and what\u2019s leftover we invest. \u201cCan you guess what\u2019s left over for most people at the end of every pay cheque? Nothing. An adviser can help change that.\u201d<\/p>\n<\/div>\n<\/div>\n He admits some clients need a reality check.<\/p>\n \u201cI might have to say \u2018You know what? You actually can\u2019t stop working now. We need you to work part-time for three more years\u2019. They see it as, \u2018All right, I\u2019ll work three more years to have $60,000 a year for the rest of my life and leave some money to the kids\u2019.\u201d<\/p>\n Tuy tries to automate his clients\u2019 finances: \u201cIt ticks along in the background and we review every year to make sure they\u2019re still comfortable with everything.\u201d<\/p>\n Downsizing is a consideration for many. Tuy has observed that most clients won\u2019t downsize until they have to. \u201cI pitch it as an ace up their sleeve. At the moment, they may be looking at an income of $30,000 to $50,000 in retirement. But if they downsize in 10 years\u2019 time, we\u2019ll look at the impact on any age pension, their ability to contribute to super, income tax and the retirement income needed.\u201d<\/p>\n Tuy admits that while\u00a0self-managed super fund<\/a>\u00a0clients are generally more hands-on in their investment decision-making, they still value a retirement adviser for\u00a0retirement planning help\u00a0and scenario modelling.<\/p>\n \u201cAn adviser can very accurately crunch the numbers around what their retirement position will look like. We have sophisticated algorithms that include tax, cash flow, assets, liabilities, splitting super contributions with your spouse, social security and more.\u201d<\/p>\n He says it\u2019s rare that even a super self-directed client could stack up everything to answer a simple, \u201chow much do I spend per week to make all of this happen?\u201d scenario.<\/p>\n \u201cAnything they want to do, we can model. And they know that all the fund managers and investments we give them access to have been stress tested.\u201d<\/p>\n<\/div>\n<\/div>\n \u201cI might say to the client, \u2018Make sure that if anything happens to you, your partner or your kids call me because I know about your finances\u2019. I can get everything together quickly for an easier estate transition.\u201d<\/p>\n Most people will find there are three or four possible financial strategies they can implement in their 50s. For Tuy, giving advice isn\u2019t about the size of your nest egg.<\/p>\n \u201cIt\u2019s about planning to use whatever you have to achieve the retirement you want. Getting advice around your budget and the strategy that will really deliver for you are the keys the best financial advice can give you.\u201d<\/p>\n Request a complimentary financial planning consultation<\/strong><\/p>\n With so many options, it\u2019s a good idea to seek help to ensure you\u2019re investing in a way that suits you. You can talk to us today on Phone 02 4342 1888.<\/p>\n Source: NAB\u00a0https:\/\/www.nab.com.au\/personal\/life-moments\/work\/plan-retirement\/planning-in-50s<\/a><\/span><\/p>\n Reproduced with permission of National Australia Bank (\u2018NAB\u2019). This article was original published at\u00a0https:\/\/www.nab.com.au\/personal\/life-moments\/work\/plan-retirement\/planning-in-50s<\/p>\n National Australia Bank Limited. ABN 12 004 044 937 AFSL and Australian Credit Licence 230686. The information contained in this article is intended to be of a general nature only. Any advice contained in this article has been prepared without taking into account your objectives, financial situation or needs. Before acting on any advice on this website, NAB recommends that you consider whether it is appropriate for your circumstances.<\/p>\n \u00a9 2021 National Australia Bank Limited (\u201cNAB\u201d). All rights reserved.<\/p>\n Important: The post Retirement planning in your 50s: choose your own terms<\/a> appeared first on MLC Contemporary<\/a>.<\/p>\n<\/div>\nWork backwards<\/h3>\n
Facing facts<\/h3>\n
Modelling for SMSFs<\/h3>\n
Ensuring the kids get what they should<\/h3>\n
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