When it comes to your wealth in retirement, how much is enough?
Use this simple equation to plan your retirement income.
Are you wondering what kind of income you’ll need when you retire? Trying to work out what your expenses will be?
The answer is actually pretty simple.
Past behaviour is the best predictor of future behaviour. When you retire, you’ll probably still live in the same house, drive the same car, shop at the same places and go to the same restaurants.
So, apart from some specific expenses that you may no longer have, such as mortgage repayments or the cost of dependents, your day to day bills are likely to be the same whether you’re working or not.
So, what does that mean for planning ahead?
Think of it this way.
Many of our clients need an annual income of between $65,000 – $85,000 (after tax) in order to fund their lifestyle in retirement.
What kind of portfolio or level of investments do you need to generate that yearly income?
- We base our conservative estimates on a 5% annual return on investments. So,
- if you need an income of $60,000 per year
- you’ll need $1.2 million of investable assets
By only using the income stream generated by these investments and not the asset growth, you can sleep at night in the knowledge that movement in the market won’t impact your income.
This ‘future-proofing’ is a vital element of your retirement income strategy. You need to plan for an income stream is:
- strong, and
This is the best way to retire comfortably without the threat of your assets expiring before you do!
For smart, honest, dependable advice on future-proofing your retirement income, give us a call today (08) 8172 9111 or email firstname.lastname@example.org.