For some of us, retirement seems a long way off.  For others, retirement age is now on the horizon.   Either way, one thing we all have in common is that fear… do I have enough saved to enjoy a fun and fulfilling retirement? How much is enough?

Financial anxiety is at an all-time high right now. COVID-19 has thrown a financial spanner in the works for so many people who have seen their share portfolios decimated, or whose business revenue has suddenly dropped… perhaps for the first time in their lives.  We are all wondering once this pandemic is over, will there be another one? Is this the new normal?

There has never been a better time to ensure that you have a water-tight plan for your financial security to protect you from all external shocks.  We can’t predict these seismic events but one thing we can do is take control of when we want to retire, the life we want to live and working backwards to ensure that we are making the right decisions now, for the future.

If you read the newspaper or click around Google, there’s “financial advice” (some good, some bad and mostly just plain wrong) out there.  It’s confusing, and often contradictory.  Should I be topping up my super? Should I start a share portfolio? Should I diversify? Should I go for the security of property and term deposits? What’s a bitcoin anyway?

Just as many of us are taking this extra time to renovate our homes, now is the perfect time to spruce up our retirement planning with these seven, easy to follow, steps and cross ‘retirement planning’ off your COVID-19 to do list.  Wouldn’t that feel good?

Let’s begin:

It starts with… when? The days of selling your business or retiring on the day you turn 65 are over. The truth is, with the right preparation, you can stop working whenever you want!  Although some time-based conditions apply to your superannuation, as Euro synth powerhouse Snap! told us in the 1990s, or HeMan if you are more into 1980s cartoons, you’ve got the power! You just need the money behind you to support the standard of living you want.

So why is setting an age so important when it comes to planning for retirement? Because it defines how long you have left to save enough money to retire on. Once we choose the age or year of retirement, we can work backwards to develop a plan for retirement.

What’s your dream? Create a vision for what retirement will look like for If you didn’t need to work, what would you do, day-to-day? What’s on your bucket list? Getting specific on the what of retirement will help to determine how much you need to make that happen for you.

How much is enough? Let’s get down to the nitty-gritty for a second. How much money will you need every week to maintain your quality of life? What essential costs will you need to cover, and how much do you need to pursue your hobbies and interests, have family holidays, and cover any unforeseen medical and other expenses that may arise?

Many, many people underestimate how much they will need to retire comfortably.  Getting this wrong can lead to unnecessary stress in retirement (it’s supposed to be a relaxing time, right?) .  Some say you only need half their current income for retirement, but this is false.  Realistically, you will need 70%-85% of your current income to live comfortably, but like your favourite pair of shoes, one size does not fit all. We need a tailored and individualised plan, and here’s how.  We’re going to do a bit of maths now… don’t get scared.

  • Do a budget for what your cost of living is now – including the fun stuff, like eating out, having friends over or weekend getaways.


  • Add in costs for any planned experiences in retirement – travel, hobbies or one-off purchases you plan to take up in retirement. You can literally search travel sites now to add up the costs of your dream holiday around the world or the beachside unit you envision retiring in, with grandchildren coming to stay.

  • Subtract costs from your budget that should no longer apply when you retire – like children’s school fees, mortgage repayments and car loan repayments.


  • This is how much you will need. For you, for your retirement.


  1. Owe vs Own. How much do you have in investments right now? Add up the value of the assets that you know you can access when you retire, like your superannuation, any investment properties, a business that can be sold, stocks and shares. With your super, if you have worked in different jobs over the years, make sure you consolidate it together so you save on fees and get it all together in one place so you know how much you have.

This value needs to be net of debt, so subtract what you owe from what you own, creating a ‘net worth’ figure.

When determining the worth of the assets, we follow ‘the rule of seven ten’. If an investment earns 7% p.a. it will double in value every 10 years. The problem is, investments rarely grow at a constant 7% p.a. indefinitely, but it is a guide to what your net worth may be when you expect to retire.

Pay Down Debt. Carrying around debt is like that stubborn tyre of belly fat… it slows you down and makes you feel yuck and stops you from living your best life in retirement. So how to win the battle of the retirement debt bulge?

Here’s a few examples of easy steps you can take pay down a loan of $500,000 faster and what it could save you…

  1. Making repayments weekly instead of monthly could save you $58,004
  2. Making an additional $100 per week in repayments could save you $132,408
  3. Doing A+B and depositing $1,500 per fortnight in an offset account could save you $158,403
  4. Doing A + B + C and reducing your interest rate by 0.5% – could save you $205,484
  5. Plus any windfalls you get – inheritances, separation payouts… resist the urge to splurge and give yourself the gift of debt reduction. Your future self will thank you.

Be a Super Superannuation is a game changer that you can use to turbo boost your retirement income. It is more tax-effective than most investments, and current rules allow superannuation to be tax-free when you reach age 60. During COVID-19, if you meet the right criteria, the ATO will let you access $20,000 of your super before age 60 to invest in your business or renovate your home to improve its value.

 Superannuation should be the mainstay of everyone’s retirement plan, and here’s how to make your super… well… even more super!

  • Make additional contributions through salary sacrificing (ask your payroll or HR department for advice on how to make this happen) or if you are a business owner, make contributions above the required 9.5%.
  • Check your super fees to make sure you are not paying too much – below 0.80% p.a. is reasonable. Also check with your employer if the super fund they use offers any subsidised fees. A 0.5% lower fee can literally be worth thousands of dollars to you.
  • Consider what insurance is held in your super because these can be cost effective and provide support should you pass away or become disabled and not able to work.
  • Check how your super is invested to make sure it’s right for you.
  • Decide…
    • How long you’re investing for. If you’re young, play the long game and take some risks. If you’re close to retirement age, play safe.
    • How much risk is comfortable –
      • Go for growth: focus on shares – good for those who are a long way from retirement
      • Seek balance: have a mix of growth (shares) and conservative (term deposits) options – good for people retiring in ten years or so
      • Do the safety dance: go for only conservative options if you are now in, or are approaching, retirement age.

The Big Kahuna – how long do I have and how much do I need? Today’s retirees can expect to live to an average age of 84.9 years for men and 87.6 for women and our lifespans keep extending. If you retire at 60, you could realistically need to self-fund for almost 30 years.  That’s a long time to make that money stretch.  There are many factors to consider here including how much income you’ll draw down from your investments, the rate of return, and the impact of external shocks such as stock market deviations, and cost of living increases.

To calculate how much money you need to set yourself up now, for retirement, use the handy calculators available at these websites:

What do you do if you won’t have enough to retire?

If you’re facing a shortfall in retirement, don’t worry… it’s not too late to get your retirement back on track. You can always boost your superannuation through additional contributions, delay your retirement, find ways to increase profit in your business, adjust your retirement lifestyle expectations, make additional investments or sell other assets.  Downsizing could be an option too.  Or you could always move in with the kids!?


By following our advice, you can risk-proof your retirement plan, ride out the COVID-19 wave, and end up sitting pretty in the beach house of your dreams, thanking yourself for the work you did today, to prepare for a golden tomorrow.