Retirement Planning
How will you maintain your current lifestyle when you retire?
The Australian Government is facing a problem; with a rapidly ageing population how can they continue to afford funding an aged pension?
Will they continue to pay a full pension, a part pension or perhaps they might do away with the pension completely?
Many men and women will live another 10-20 years beyond their retirement age. It is never too late to start planning for your retirement to ensure that you can maintain your current lifestyle. When planning for your retirement future it is important to seek professional advice from a qualified financial planner.
Some key areas to consider are:
- Rapid Mortgage Reduction
- Transition To Retirement Pension (TTR Pension)
- Aged Pension
- Superannuation
RAPID MORTGAGE REDUCTION:
Rapid mortgage reduction strategies will vary considerably depending on your circumstances. As a home owner; rapidly reducing your mortgage is one of the best savings and investment strategies that you can undertake. This will ease your mortgage stress by reducing your long term repayments and allowing you to build equity in your home a lot faster.
Close Financial Group can tailor a strategy that will best suit your needs and ease your financial burden. Ask us how we can effectively formulate a plan that will work best for you.
TRANSITION TO RETIREMENT PENSIONS:
Many people in their mid to late 50’s are not ready for fulltime retirement but want to reduce their working hours. A Transition To Retirement pension (TTR) allows them to top up their reduced wage or salary earnings with their super.
If you're over 55; the Transition to Retirement (TTR) pension provides a range of retirement options. This means that you have the flexibility of gradually easing into your retirement by working fewer hours and you can still access your superannuation benefit.
TTR pensions reduce the burden on the aged pension and allow employers to retain highly experienced workers who could otherwise choose to retire.
Salary Sacrificing can greatly accelerate your accumulated retirement funds in the lead-up to full retirement. Our financial planning experts can advise you on implementing a strategy that will achieve the optimum results for building your retirement nest egg.
AGED PENSION:
The aged pension is a fortnightly payment from the Federal Government to assist people who have retired meet their daily expenses. The maximum single person pension rate is $671.50 per fortnight and $506.50 each for couples per fortnight.
The pension is means tested based on your level of income and assets. Some people could be asset rich but income poor and unfortunately could find that they either do not qualify for the aged pension or part qualify receiving only a portion of the usual fortnightly figure.
Most people will struggle to maintain their existing lifestyle with these amounts which highlights the importance of adequately providing for their retirement future.
Close Financial Group can provide you with accurate advice that will help you achieve financial prosperity and independence that will allow you to enjoy the lifestyle that you want in your retirement.
SUPERANNUATION:
Superannuation is a tax effective investment structure through which a fund member’s savings are consolidated along with investment earnings in order to provide a financial benefit for people’s retirement.
Superannuation is not an investment in its own right but rather a secure tax effective structure through which investments are held. This money is preserved for its members until retiring age and is taxed at a much reduced rate to encourage people to provide for their retirement future and reduce the dependence on the aged pension.
Money is contributed into a superannuation fund either by the member or their employer which is invested in several key areas. This fund provides an effective tax minimisation structure for holding multiple different investments which we would otherwise have in our own name. This money continues to grow over a number of years with the aim being to provide the fund member an income or a lump sum figure upon their retirement.
Close Financial Group can advise you of a strategy that will best suit your needs and effectively provide for your retirement future.
SUPERANNUATION GUARANTEE
From the 1ST JULY 1992 the Federal Government introduced legislation mandating employers to pay their employees 9 percent of their base wages into a superannuation fund to reduce the burden on the aged pension.
Most industry sources feel that a 9 percent employer contribution is about HALF of what is needed to provide a reasonable standard of living upon your retirement.
SALARY SACRIFICED CONTRIBUTIONS
Salary sacrificed contributions are a very effective tax minimisation strategy where an employer pays a negotiated amount into their employee’s superannuation fund. This money is then taxed at a lesser rate of 15 percent instead of a marginal rate of up to 45 percent.
GOVERNMENT CONTRIBUTIONS
The Federal Government will make a maximum superannuation co-contribution of $1,500 to low income earners. The government will contribute $1.50 for every $1.00 that is paid by the individual provided that a number of conditions have been met to qualify for this incentive.
Call Close Financial Group today to speak to one of our qualified financial planners and find out how you can enjoy financial independence!