The first thing I want you to think about is the many people you know (maybe even your parents or grandparents) who are existing today on an age pension. You will be well aware of the struggles that they go through to makes ends meet each week until their next pension day. The current maximum single age pension is $335.45 per week and for a couple it is a maximum of $252.85 each per week!
The graph on the left, from the Australian Bureau of Statistics (ABS), illustrates the actual retirement incomes of Australian’s as at the most recent 2006 Census. Something to think about?
Employer sponsored superannuation will not provide enough income in retirement.
According to the recent report by independent actuaries Rice Warner, to finance a pension that pays you 60% of your pre-retirement income, you need to contribute between 20% and 30% of your income to super over your full working life. They went on to say that most retirees are running out of money and having to fall back on the age pension within the first 15 years of starting their retirement.
After the recent Global Financial Crisis many older Australians have had to adjust their spending down or return to work to survive. This is a pretty sobering thought. The average Australian retires on much less than they earned during their working life. As a nation we are living longer so how would you feel having to live on this type of limited income for 20 – 30 years?
At QPS we assist our clients to end up in the green or purple area of the graph. We want you to retire wealthy but also create wealth for today to enjoy the things you want to do now such as overseas holidays, upgrading of your car or motorbike, pursuing expensive hobbies and other lifestyle desires.