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For most Australians, retirement is one of life’s biggest milestones. After decades of hard work, you want the confidence that your money will last, your lifestyle is secure, and your future is in your control.
Here are seven practical steps to help you retire well (please note, this is general guidance only, I don’t know your individual circumstances):
1. Understand the life you want in retirement
Retirement means different things to different people; travel, family time, hobbies, volunteering, or a mix of all. Before you crunch numbers, be clear on what matters most to you. This clarity will guide every financial decision and help make retirement more fulfilling.
| Did you know: There’s no ‘set’ retirement age in Australia – you can retire whenever you want, as long as you can financially support yourself. You are able to access your super from age 60. |
2. Determine the resources you’ll need
Once you know what your ideal retirement looks like, calculate the income required to fund it. While some say you’ll need 70-85% of your pre-retirement income, the real answer depends on your lifestyle. A personalised spending plan gives you the confidence to spend without fear of running out.
| Did you know: Most Australian couples spend around 50% more in their 60s than in their 80s. |
3. Boost your super
Superannuation is still the most tax-effective way to fund retirement. Consider maximising concessional contributions (up to $30,000 per year, including employer contributions), take advantage of catch-up rules, and consider non-concessional contributions if you have extra savings or have sold assets. Every extra dollar in super can work harder for you thanks to low tax rates.
| Did you know: Concessional contributions to super are taxed at just 15%, often much lower than your personal income tax rate. |
4. Have a debt strategy
Heading into retirement debt-free gives you more options and less stress. Aim to clear your mortgage before retiring or plan to use a tax-free lump sum from super after 60 to pay it off. If you’re weighing up between paying down the mortgage or putting more into super, the tax benefits of super (15%+ immediate return) often make it the smarter choice.
| Did you know: If you’re 60 (or older) and retired, you can withdraw from your super tax-free to clear remaining debts. |
5. Create a retirement income stream
Your retirement isn’t just about how much you’ve saved; it’s about turning savings into a reliable income stream. Account-based pensions are flexible, tax-free after 60, and can give you predictable income. Check if you qualify for the Age Pension or other entitlements and consider how downsizing or restructuring investments might improve your income plan.
| Did you know: Couples can have up to $4 million combined ($2 million each) in super invested tax-free for life when they move their money from accumulation phase to pension phase. |
6. Invest intentionally with realistic expectations
Your money needs to last as long as you do, so invest with purpose. Growth assets help your savings keep up with inflation, while defensive assets provide stability. Don’t panic over market ups and downs, as history shows that markets recover, and setting realistic expectations helps you stay the course.
| Did you know: Share markets, on average, experience a 10% correction every few years. |
7. Know how long your money will last
It’s more important to live rich than die rich. Understanding how long your money is likely to last helps you spend with confidence. Remember, most retirees spend more in their 60s and less in their 80s.
A financial adviser can model your retirement plan – so you know when to adjust and how to avoid outliving your money.
My final thoughts…
Retirement isn’t about hitting a magic number, it’s about clarity, control, and confidence. By considering these seven steps, you’ll likely be in a better position to enjoy the life you’ve worked so hard for.
Meet Kieran at Financial Foundations, follow him on Instagram or TikTok, or Find a Planner near you.
The Money & Life website is operated by the Financial Advice Association Australia (FAAA). The views expressed in this article are those of the author and not those of the FAAA. The FAAA does not endorse or otherwise assume responsibility for any financial product advice which may be contained in the article. Nor does it endorse or assume responsibility for the information.
