Practical advice for pre-retirees - from those already retired
Practical advice for pre-retirees - from those already retired
AND, How can super funds help us retire happy? Here are eight ideas
In this edition
It’s Sunday again and this weekend, the bumper epic newsletter includes:
Feature article: Practical advice for pre-retirees - from those already retired
In today’s Newspapers: How can super funds help us retire happy? Here are eight ideas
From Bec’s Desk: It felt quieter this week
Prime Time podcast: Explaining ETFs: How retirees use them to invest for income and growth with David Lane
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Practical advice for pre-retirees - from those already retired
This article was first published on our website here.
This week, in The Epic Retirement Club (Facebook Group) there was a wonderful discussion led by our epic retirees. They were offering open and honest advice to our pre-retirees about the things they wish they’d known and acted on before they retired. There was some really terrific advice shared on the post, which was packed with long, well-thought out responses. In fact, there was so much good stuff that I thought I should turn it into a long, valuable article so it doesn’t get lost in the annals of social media. It almost makes me redundant - knowing there’s such good advice out there in our community! I’m delighted to see it matches up to lots of the things in my book too. So, here’s 20 of the best pieces of advice. Enjoy. Leave your own as comments on the newsletter too.
Think about what you’ll do once the honeymoon is over
Before retirement (I retired at 56), I thought it was a maths problem and therefore all my pre retirement planning was financial. I had a great financial plan but did not have a ‘what am I going to do plan’. After the initial honeymoon period of around 12 months, which was awesome, I fell into a bit of a heap. Even travel was not quite so enjoyable as I had not earned the holiday, unlike taking a break from work. I eventually found a great little casual part time job where I am connected with people doing something I really enjoy. And they are OK with me going away for long periods at a time. I wish I had thought more about what life would be like after the first 12 months of retirement, planned in advance, and set up a part time role. I did not appreciate that for me, working is actually an important part of a well rounded enjoyable retirement! Advice from Barry Wyatt
You retire from WORK not LIFE.
Don't be afraid to try new things even though they may be out of your comfort zone. You may surprise yourself. Advice from Robert Silvestrini
Be aware - it’s hard to get or up the balance on a credit card once you aren’t working anymore
Increase your credit card amount as it’s impossible to do when self funded living off your super., get a interest free card to buy furniture etc - just in case. Advice from Kathryn Davis
Don’t put off the good stuff, you might not stay healthy forever
Travel lots as you never know what’s around the corner health wise, enjoy new things/people. Advice from Jean Shephard
Think about putting some structure into your days and weeks
Have an idea of how you will structure your time. From having a few regular weekly activities to having travel plans to look forward to. Advice from Jan Smith
Be proactive about keeping in touch with people from your working life
If you work in a large organisation, get the numbers of the people you respect and like the most. Stay in touch with the real people you like being around. Advice from Brendan Winduss
Be kind to each other in adjusting to retirement.
You'll most likely spend more time in daily life with your partner. Do fun things together and also maintain your own activities and friendships. Grow together and also individually as a person. Advice from Jan Smith
Have a complete health check up.
Your body is important. Advice from Lyndal Meredith
Get money into super every which way that you can
Get as much money into super as possible as it’s all tax free coming out. Advice from Robert Relph
Use your leave before you retire, rather than getting it paid out
Take all annual/long service lease as leave - super is paid on it. Super is NOT paid on lump sum payouts. Advice from Scott Malpass
Declutter
Declutter everything - the house, your finances, your super, your insurances … Advice from Lyndal Meredith
Replace things that need replacing before you retire
My brother retired at 60 but wished he had replaced things in the house. Like oven, carpets, fridge, paint inside etc. before he finished work. They cost $$$ after retirement. Advice from Astrid Thompson
Be lifestyle-ready as well as financially ready
By that I mean give serious thought to how you will fill your days when you no longer have work and you’ve been on the big trip. What will get you up in the morning and genuinely excited about the day ahead? What are your passions? Dig deep - this is the chance to find out who you are outside of work and live the real you. Have a go at some of the things you identify before you finish work to help with the transition from work to your retired life. Advice from Giulio Cerasani
Celebrate
Enjoy the fact you made it to retirement age as not all do. And, take up activities you enjoy that also keep you fit active and connected to society and try not to over think everything. Advice from Bob Dyer
Make sure you have a purpose
Retirement without a purpose has been found to reduce your life expectancy. Advice from Steve Weir
I can’t fit them all on the newsletter - so read more on a longer article on this website here.
How can super funds help us retire happy? Here are eight ideas
Never before has Australia had so many people interested in retiring simultaneously. There are over 4.2 million retirees in Australia, but only about 1.3 million have shifted their superannuation into the retirement phase.
This means most super funds are not yet accustomed to managing the needs of retirees and the outflow of funds via pensions in large volumes. They also haven’t felt the pressure to educate people about spending their money in retirement. However, the winds of change are gathering.
Seven hundred thousand Australians are projected to retire in the next five years. While this number might not seem overwhelming, when combined with the 2.9 million retirees not technically in the retirement phase who may start using their super funds as intended, the industry faces a significant shift in demand for retirement products and services.
The government has been nudging the superannuation system and funds of all kinds to prepare for this shift. In 2018, they legislated for the introduction of retirement income products to help consumers manage their money over longer lifespans.
They also required funds to have a retirement income strategy by July 2022, aiming for improved retirement outcomes for consumers. By July 2023, they reviewed the pace at which funds were implementing their strategies and pointed out that most weren’t moving fast enough.
But what does that really mean for us everyday people? According to the 2024 Allianz Retire+ Epic Retirement Planning Survey, 57 per cent of retirees said they were happy with their fund’s support of the retirement process. That number isn’t high enough.
Proactive funds are the ones actively building retirement income products, financial advice, education, and tools suited to their members.
Frankly, the government can only push funds so far. After that, it’s up to us, the everyday people who want good products and services at retirement, to take action and vote with our feet. We need to know how to identify a good super fund at the retirement phase from a less effective or even lazy one. Today, I’m going to teach you what I look for.
Here are eight things that we, as ordinary people looking to use our superannuation fund’s services in pre-retirement and retirement, should understand and watch for as our funds improve in the retirement phase. These services might not all be available now, but you’ll be able to tell if they’re making progress.
1. Investment options with competitive returns. Your fund has probably already mastered getting good investment returns in the accumulation phase. If they have, then your returns in the retirement phase at the same risk level should be higher because it’s a CGT and income tax-free phase.
You should monitor your fund’s performance by benchmarking it against the top 10 performers in the retirement phase at the same risk level every year. Finding this data can be tricky as there are no government benchmarks.
I published a report here on last year’s top performers to help. For instance, the top ‘growth’ fund in the retirement phase in 2022/23 was Brighter Super’s Optimiser Multi-Manager, Growth, with a 14 per cent return. Over 10 years – a far more important benchmark – CSCi Aggressive and Hostplus Balanced Growth both topped with 10 per cent returns, according to Chantwest.
2. Fair fees. Fees eat away at your returns and slow down the compounding of your money, but benchmarking fees in the retirement phase is difficult due to the lack of public data.
For now, you can calculate your fees as a percentage of your balance and compare them with accumulation phase fees at the same risk level using resources like the YourSuper comparison website. If they’re high, ask yourself why. Ask your fund too.
3. Retirement phase products. Most superannuation funds offer retirement phase products, the most popular being account-based pensions. Some are starting to build ‘lifetime income’ products to sit alongside these, into which you can invest a portion of your retirement savings and get a guaranteed income for the whole of your life, even if you live much longer than you expect.
It’s like having life insurance for a long life, rather than a short life. Many funds also offer term annuities and term deposits, though these are not always heavily promoted. This is likely to change as the number of retirees increases.
4. Education. One of the fundamental tenets of the retirement income covenant was ‘fit for purpose’ assistance for members approaching, and in, retirement. Education is one place where funds can really do right by their members.
When members understand what happens in the retirement phase, how money works, what decisions need to be made and how the systems of retirement support them, they can feel a lot more confident about using their money in retirement.
I project that they also make better long-term decisions because they won’t be as easily tricked by slick operators. So look twice at the education offered by your fund. Is there any? Are you using it? Does it help you navigate retirement?
5. Financial advice. Superannuation funds are waiting on government legislation to offer better quality advice to members approaching retirement. As the rules change, you’ll have access to various types of advice from your fund – some free and some paid – all of which must be in your best interest.
There’s more to this article…
You can read the rest of this article here in today’s The Age, and the Sydney Morning Herald. It is not behind their paywall, but you may need to sign into their website to read it.
Was it a quieter week? It felt like it.
This week I’ve been gloriously back in my home office, focussed on hosting the 6 week Epic Retirement Flagship Course - Winter Edition which is up to week 3 already! And it’s going swimmingly. Our live event this week with Andrew Lowe from Challenger ran overtime people had so many questions about spending in retirement and safe spending levels, always a wonderful problem!
A massive delivery of Epic Retirement books has just arrived, ready for our Spring Edition of the course which kicks off on the 8th August. So if you want to lock in your place at the earlybird rates, you can now book here. There will only be one more program this year after that one… I’m going to run these just four times a year from here as a lot of effort goes in from myself and our guests. We’ll take a longer break after the Spring program before launching one for Summer.
This week I did a new national live education session for the Life-X team at Suncorp (Gen X and boomers employees), who organise their chosen staff training as a peer-group and keep asking me back (thanks guys!). This topic, by special request was ‘Travelling in your Prime Time: The travel hacks and tips every over 50 wants to know’ - such fun to deliver! And everyone wanted to know how to get great deals and amazing experiences!
And, also this week I was asked to produce a special feature for The Sydney Morning Herald, The Age, Brisbane Times and WA Today - for their midweek edition. This piece answered the big questions that most people need to understand about their superannuation. “How do I get my super when I retire? And how much will I need?” was the topic. It’s a long, practical piece. Read it here.
Finally, on the Prime Time podcast, it was all about ETFs - a popular type of investment for retirees and pre-retirees. I had one of my favourite people on the show - Senior Financial Adviser and the QLD State Manager of Ord Minnett, David Lane, who helped me with the How to Have an Epic Retirement book. The topic of the show was ‘Explaining ETFs: How retirees use them to invest for income and growth’, and that we did! He also talked about which ETFs he’s watching right now.
All in all, it felt like a quieter week - maybe because I didn’t fly anywhere - but plenty to show for it. Next week is a book-writing week. Gotta get my next one finished. It’s planned, mapped and underway (and I am rather optimistic that it’s pretty cool). This cold weather provides the perfect indoor-time.
A new claim this week - one I never thought of achieving - my book is now #1 most gifted book on Amazon in the categories of Accounting Specialties, Pensions and more - and it’s not even gifting season. And, it’s bestseller #90 on the Amazon top 100 for ALL books in all categories! You can order it on Amazon here and it’s just $22 in Australia right now.
And if you’ve already bought it via Amazon (which I know thousands of you have) - do a girl a favour and please, leave a review!
Finally, don’t forget to send me your letters. You can always email me at bec@epicretirement.com.au. Until next week… make it epic!
Many thanks! Bec Wilson
Author, podcaster, guest speaker, retirement educator … Visit my website for more info about me, here.
Explaining ETFs: How retirees use them to invest for income and growth
Today we’re talking about the very hot investment topic - ETFs or exchange traded funds. We’re going to dive into what they are but also how all generations, and most particularly, modern retirees are using them to invest for income and growth.
So this week I’m chatting with Senior Financial Adviser and State Manager for Queensland of investment firm, Ord Minnett, David Lane. And we’re truly demystifying ETFs.
LISTEN HERE:
Hey there! A quick and important note
The content in this newsletter and this podcast is for your general information only. It’s not financial, legal, or professional advice. I do my best to keep things accurate, but there’s no guarantees. Before making any big money moves, please chat with a qualified and experienced advisor. I can't take the blame for any mishaps from relying on this information - nor can Epic Retirement, or other related companies. Stay savvy and always do your homework!