Are you making the most of your retirement?

Building wealth is akin to training for a marathon or a goal you have set for yourself. It takes discipline. While we are working, we get accustomed to an income, paying our bills and putting money aside for the future.

When you retire, that model is no longer in play. Your income stops, but the bills and everyday expenses don’t. Instead, your super, investments and other assets need to do the heavy lifting.

That change can be confronting. Watching your super balance fluctuate or making withdrawals from an investment portfolio can feel very different from receiving a regular salary.

This is where the discipline of a retirement plan takes over. Rather than looking at your wealth as one large pool of money that you’re slowly using up, you can start looking at how different assets can work together to provide income, growth and financial flexibility.

One misconception about retirement is that it means it’s time to stop investing for growth and move everything into conservative assets. For many people, that could mean overlooking just how long their investment timeframe actually is.

If you retire in your 60s and live into your 80s or 90s, some of your money could remain invested for another 20 or 30 years. Your investments play an important role throughout retirement.

The challenge is getting the balance right. You may want sufficient cash and defensive investments available to cover shorter-term needs without having to sell growth investments during an unfavourable market. Meanwhile, money you aren’t likely to need for many years may remain invested with a longer-term perspective.

A well-structured portfolio should be designed to do several jobs at once: provide income, retain accessible capital and pursue growth to help protect your purchasing power against inflation.

You’re meant to enjoy your retirement. Your working life has been leading to the “Golden Years”, and retirement shouldn’t become an ongoing exercise in worrying about whether you can afford to make the most of your time.

By investing in quality financial advice early, you have a clearer picture of what your assets can realistically support. That might involve modelling your expected retirement income and expenditure over many years and considering super, investments, cash, Centrelink entitlements, taxation and other assets.

At First Financial, we also model and test different scenarios. What happens if investment returns are lower than expected? What if inflation remains higher for longer? Could you afford to travel regularly? What happens if you help your children financially? What capital would you like to retain for future health or aged-care needs? How much would you like to leave behind?

There are no concrete correct answers. What matters is knowing how your choices affect the bigger picture.

A retirement lasting 20 or 30 years rarely looks the same from beginning to end. Your investment strategy shouldn’t be expected to remain unchanged either.

As we’ve seen often over the past few years, markets move, interest rates change, and tax and super rules evolve. Your spending patterns, health, family circumstances and priorities can also look very different at 75 than they did at 65. Regular financial advice provides an opportunity to review your position and make adjustments where necessary rather than relying on decisions made years earlier.

Reviews can involve changing investments, adjusting how you draw income, reviewing your super strategy, or simply confirming that you’re still comfortably on track.

Our role is to help you enter retirement in good shape and navigate it successfully. Retirement should be about understanding what you’ve built, how it can be invested appropriately and what sort of lifestyle it can sustainably support.

For some people, financial advice is about identifying where they need to be careful. For others, it’s about discovering they can afford more than they thought. At the end of the day, having a financial adviser in your corner ensures you have the information and support you need to make sound decisions that enable you to enjoy your retirement years.

The team at First Financial comprises financial experts who help hundreds of Australians retire well and make informed, intelligent financial decisions. We cover everything from retirement and financial advice, investment and wealth management, superannuation and SMSF, insurance, tax, aged care, legal and lending services.

Contact us for holistic, well-rounded financial management strategies.