How many years do you have left before you can walk away from your job for the last time and enjoy life in retirement? More importantly, have you worked out how you are going to cope financially when those pay packets no longer land regularly into your bank account. The sooner you take action and work out how to fund more fun into your retirement the better off you will be. Relying on the age pension and your superannuation may simply not be enough to guarantee the freedom you would like in your golden years.
You can’t party on the pension!
Even if you own your home outright, life on the pension will not allow you much room for play. The current payment for a full pension is $436.00 per week for a single and $658.00 for a couple (eff. Nov 16) and at first glance that looks ok and you can definitely get a counter lunch or two at the local club with that. Prepare even the most basic of budgets and by the time you have allowed for major expenses like rates, insurance, health insurance, home repairs, food, electricity and motor vehicle expenses, there wont be much left for holidays or filling the fridge with Moet.
The introduction of compulsory superannuation has ensured that every working Australian will have something in their fund to use in retirement, but unless you have contributed additional funds personally or have an employer that has added more to your fund as part of your employment package, you could be very disappointed in how quickly your super is spent.
Create an additional income stream with real estate
The equity you have in your family home can be the key to lots more fun in retirement. In almost every part of Australia, real estate prices only go up. Purchasing an investment property sooner rather than later could provide you with an asset that continues to grow in value. Depending on your circumstances when you retire you could sell the property and enjoy the capital gain or continue to receive rental income. Throw in the tax benefits that can come with real estate investment and you could be on a real financial winner.
There are plenty of things to consider when choosing an investment property such as location, close access to important amenities such as public transport and schools, as well as current demand on properties in the areas that appeal to you. Before you get excited about seeing ‘SOLD’ splashed across the ‘For Sale’ sign it is imperative that you do your homework and please get advice from experts in financial planning and real estate before you make large investment decisions.
Don’t sink your savings into a lemon
It is very easy to get a little carried away when looking into buying an investment property. On the surface everything may look fresh and fabulous, but you need to be very wary of vendors and real estate agents that have only one goal in mind. Sell the property!
With the help of paint, fake walls and floors or new tiles, a myriad of problems can be hidden from sight. The last thing you want is to buy a ‘lemon’ that will require you to sink your savings into big ticket repairs and maintenance outlays. It is absolutely imperative that you have a thorough building inspection done buy an independent expert in preference to a company suggested to you by your agent that might not provide a completely accurate report.
Action Inspections are a fully accredited and compliant company that have been providing concise property inspections in my home town of Brisbane for 28 years. You will be amazed at the extent of detail that goes in to providing a Pre-purchase report. If you are anywhere else in Australia, a quick internet search will help you locate a suitable company in your area that could save you so much money in the long run. Don’t forget to ask friends and family for recommendations as well, they will know whether their report was accurate or not.
Retirement should be all about sleep ins, planning fun getaways or spending quality time with family and friends rather than a continual circle of stress about how to pay the bills. An investment property has the potential to help you fund more fun in your retirement. You have worked hard for all that you have, make sure you don’t jeopardise any of that by making choices without expert assistance.
* This is a sponsored post, all opinions and ideas are my own.
Have you made any plans for retirement other than superannuation?