Super scramble:  How to get the most out of your retirement nest egg

Super scramble: How to get the most out of your retirement nest egg

Research shows that less than 50% of Australians know their super balance.  And of those who do know – a whopping 60% are concerned they won’t have enough to live off when they retire.

But just how much is enough?

Australian Superannuation Fund Retirement Standard suggests that a comfortable transition would see singles needing $545,000, with couples aiming for $640,000.

For many, the idea of accumulating this kind of reserve seems far-fetched.  Fortunately, though, there are a few measures you can take to better your chances of landing sunny side up.

 

1. Find the right fund

Melinda Howes of BT Financial Group says, “The right fund for you will depend on what you feel is most important”.  When exploring your alternatives, she recommends analysing these five essential elements: performance, fees, investment options, insurance and any additional benefits or services.

 

2. Watch out for fees

It makes sense that a fund with low costs will grow your super faster.  And, although all funds charge fees, the types of outlay and amounts will vary across the board.  Check your statements for extras like advice fees, indirect costs and activity-based fees.

 

3. Know your investment mix

Your super fund investment portfolio is somewhat like a gourmet omelette.  You need the right ingredients and the correct balance of flavours to get it just the way you like it.  Maybe you want nothing but full fat, or perhaps you’d prefer to ditch the salt.  Your tastes and dietary requirements will dictate the outcome.

Similarly, depending on factors such as age, risk-taking, fund accessibility and personal retirement goals, you’ll need to adjust your investment “mix” accordingly.

 

4. Find your missing super

The ATO claims that 40% of Australians hold two or more super accounts, so it’s no wonder a good portion of funds ends up going astray.  If you think you may have some lost super floating around, you can ask your existing fund manager to perform a search, or use the ATO’s MyGov service.  The idea is then to consolidate into one fund, saving you a possible $42,500 in overall fees.

 

5. Use the tools

If you need some help working out how much super you’ll need on retirement, there’s a nifty calculator you can use at moneysmart.gov.au.  You can review your current balance and determine how much you’ll likely have when you stop work.  It will also show you how long your funds will last, and estimate how many years you’d have to remain in the workforce to give you what you need.

 

By taking the time to review and amend your nest egg regularly, retirement is bound to be over easy.

If you’d like more information on how you can grow your fund faster, give us a call to discuss our unique investment options.