Financial independence (55+)

After decades of building wealth, the focus now shifts to making the most of your assets.

A growing number of Australians are choosing to gradually scale down their working life, shifting from full-time to part-time work before retiring completely. Purpose-built  financial products called ‘transition to retirement’ pensions are designed to help this strategy though tapping into your super, or other assets, at an early stage can impact the funds available further down the track.

Indeed the whole issue of drawing down super calls for professional advice. There is a wide range of options available, and while you can withdraw your super tax-free from age 60, this may mean shifting the cash from a tax-friendly environment to a fully taxable one.  A better strategy may be using your super to purchase a private pension that delivers regular income in much the same way as your wage or salary. Your adviser can provide further details as you should also be mindful of maximising any social security entitlements including the age pension.

For home owners, products like a reverse mortgage offer a means of accessing home equity without the need to sell your home. This will enhance retirement income, though with the risk of depleting home equity, which could be needed to fund aged care accommodation later on.

As we age life insurance becomes far less important, and your focus should turn to estate planning. Having a professionally drafted will, and appointing power of attorney, which nominates a person to manage your financial affairs when you no longer can, will bring valuable peace of mind to you and your family.