Thinking about retiring soon? Here’s where to start”

Are you planning to work part-time or move away from paid work altogether? Do you want to travel, and if so, where and how often? Will you be a caregiver and how intense will it be? Will you volunteer, work or train for something new?

Then dig one layer deeper: What does a truly great week look like for you? Not an idealized Instagram version of retirement, but your real expectations from life. When the hierarchical career structure ends, the rhythm of your days becomes more important than you think.

Walking away from a job, a title, or a role can leave uncomfortable space until you consciously refill it.

These are not fluffy lifestyle questions. These form the basis of your goal setting, and this comes before the budgeting process.

You can’t figure out what your future will cost until you know what you want your future to be. And even the smartest financial advisor can’t set these goals for you. Only you can do that part.

Investigating how much is enough

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Once you’ve mapped out the life you want, you can start calculating what it might cost. And this is where people often discover something surprising: their numbers are often much more attainable than they feared.

The amount you need in retirement isn’t a single magic number. It depends on four things: the lifestyle you just described; the income you really need each year; how much comes from pensions, old-age pensions and other sources; and your health, longevity prospects, and family responsibilities.

Most Australians will derive their retirement income from a combination of super, part-time work, investments, savings and, for many, age pension. This means that the big aggregate issue is much less important than people think.

In fact, Australians who receive a full-age pension over their long lives may find it covers retirement costs of up to $900,000; This amount is more than most people’s super balance in retirement.

So the real question is “How much lump sum do I need?” not. What matters is whether you understand how retirement systems work, how the layers of income you may have interact and how you can use them to your advantage. Then how they will change over time.

Run the numbers and then get help

If you’ve never done your own “retirement income” calculation before, now is the time to start.

Your super fund can provide you with an estimate through its app or guidance team. You can enter some numbers into a simple calculator. Then take a breath and think about what kind of advice you might need.

Many super funds now offer low or no extra cost advice on superannuation and not enough people realize that this is something they are already paying for through their own fees. In other words, it may not cost you anything to try.

If your needs are simple, this level of guidance may be sufficient. If these are more complex, you may need comprehensive advice, and if your fund is doing a poor job, consider this a useful lesson too. It’s still an excellent place to start, especially if you’re not planning to overhaul your entire investment strategy.

Set up your retirement account and withdrawals

Once you’ve roughly calculated how much income you’ll need, the next piece of the puzzle is understanding how to turn your retirement income into a regular income stream.

This is what happens when you instruct your retirement fund to shift your account from the accumulation phase (where contributions and growth are the focus and you pay 15 percent tax on income) to the retirement or “retirement” phase, when your goal is to generate a stable, tax-free income while managing risk a little more carefully.

This is when planning becomes reality. Withdrawing money from your retirement isn’t just a technical step; It’s a long-term strategy that impacts every part of your retirement.

You need to think about how much to withdraw, how often to withdraw, and how to invest the remaining balance so it continues to grow and support you for decades to come and support everything you can (or cannot) do with your money.

If you spend too quickly, you run the risk of running out of balance sooner than expected. If you spend too slowly, you run the risk of looking back at a pile of money with regret in your old age.

A good retirement investment and withdrawal strategy strikes a balance between confidence and caution. It assumes you want your money to last a long time, yes, but it also assumes you want enough freedom to actually live the life you dream of.

And if you understand the plan, you’ll be less likely to panic when the markets shake because you know you’ve planned for it.

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Explore your sense of purpose

After all, the reason you adjust your finances is to give yourself the freedom to spend your time on things you enjoy, care about, and energize. These are things you choose regardless of how much they pay. And for many people, making this change can be surprisingly difficult.

Our identities are often tied to our work and ego. Walking away from a job, a title, or a role can leave uncomfortable space until you consciously refill it. So take the time to rethink what you value, how you want to contribute, and what makes you feel useful and engaged is an important part of the transition.

Your goal doesn’t need to be big. It just needs to be yours.

This time of year is when many Australians are quietly withdrawing from the workforce. Some have been planning this for years. Others come here due to restructuring, health changes or care responsibilities. And I expect that this year, this month, we will see one of the largest retirement waves we have ever experienced as a country.

So if you’re considering retiring between now and the new year, start with the basics. This month I released a free starter kit – a simple toolkit to help you set some goals, consider how much is enough, and consider your sense of purpose.

A great place to start. And remember, retirement is no longer a finish line. For most Australians, this means a long, gradual transition to a different way of living and earning. The more prepared you go in, the easier it is to make good decisions and avoid the traps that catch people leaving too late.

Bec Wilson is the bestselling author How to Have an Epic Retirement and new releases Prime Time: 27 Lessons for the New Middle Life. Writes a weekly newsletter epicretirement.net and hosts prime time podcast.

• The advice given in this article is general in nature and is not intended to influence readers’ decisions about investments or financial products. They should always seek their own professional advice, taking into account their personal circumstances, before making financial decisions.

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