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Securing Your Future: Financial Planning In Your 60s

Once you reach your 60s, your main aim is likely to be enjoying retirement. You may be cutting down on your working hours or have already ended your career.

Regardless of where you are in life, it’s vital to take a keen interest in financial planning in your 60s to secure your retirement. Even in your 60s, your super is not a fixed entity. You have the option to tinker with it so that your super investments beaver away for you in the background.

We’re brimming with retirement planning ideas, so read on for the tips you need from the premier financial planner in Brisbane.

Get to Grips with the Rules Around Super

Your financial circumstances will be different to others. Even if certain strategies are not right for you, they’re worth considering as they may spark ideas that are more appropriate. When you reach your 60s, the regulations for accessing your super change, as does the amount of tax you’ll pay when you take your benefit.

Most people can take their super benefit tax-free when they hit 60. You can decide to withdraw your super as a form of income, lump sum or a combination of both. You should not take this decision lightly. Talk to one of the PAC Financial team who can guide you through the rules for accessing your super.

If you’re already in your 60s, it may be worth considering a transition-to-retirement (TTR) pension. This will let you reduce your working hours but plug the hole left in your salary with an income from your super.

When retirement planning, you might also want to consider sacrificing some of your salary into super to save tax and then using a TTR pension to make up for some or all your lost income, even if you carry on working.

Government Co-Contributions and Investments

If you have reduced your working hours and are taking home less cash, check your eligibility for a government co-contribution into your super account. This could be up to $500 a year when you make after-tax contributions to your super fund.

When you are in your 60s, you should take time to review your investment strategy. That includes assessing the level of risk you are taking with the savings in your super account or super pension.

Making investments later in life may seem counterintuitive, but it should be part of financial planning in your 60s. Diversification is one way you can reduce the risks associated with investments, for example.

You could consider spreading your wealth over stocks, cash, bonds, or even property. Purchasing managed investments in various companies operating in different sectors can also diversify your investment portfolio. Talk to one of the PAC Financial team members about all your investment options.

Top Up with Some Last-Minute Contributions

If you think your super account could do with one last final boost, you should think about making a big non-concessional (after-tax) contribution.

The bring-forward rules let you make additional non-concessional contributions with no necessity to pay more tax, provided you meet certain eligibility criteria.

For the 2022–23 and subsequent financial years, you’re eligible to use the bring-forward arrangement in that particular annual period. This is provided you were under 75 years of age within a financial year from 2022-23 onwards. There may be constraints on the kinds of non-concessional contributions your fund may be able to accept.

Any individual under 75 can make both concessional and non-concessional contributions to their super account, even if they don’t work.

However, once you turn 67, you’ll have to comply with a work test should you wish to make a tax-deductible super contribution. This means proving you have been in gainful employment for 40 hours or more over a period of 30 consecutive days.

Make a Retirement Budget

This is an essential part of financial planning in your 60s. It’s critical to figure out a budget so that you’re sure how much you’ll have to spend every year. Check how long your super is going to last and consider the lifestyle you’ll be able to afford with the cash you have in savings.

Work out how much income your non-super and super assets will give you and compare this to your retirement budget. If the two figures are poles apart, you may want to think about continuing to work or returning to your chosen career.

You may also want to consider the government’s Home Equity Access Scheme, which could give you extra income through a reverse mortgage-type loan against your home. There are other ways to release equity from your home. PAC Financial can talk you through the implications and potential pitfalls.

Bag Yourself a CSHC Card

You should also see if you qualify for the Age Pension or Commonwealth Seniors Health Card (CSHC). It comes with a range of valuable benefits that can include:

  • Cheaper medicine
  • Help with gas and electricity bills
  • Lower water and property rates
  • Reduced health care costs, including ambulance, eye and dental care
  • Reduced fares on public transport

Estate Planning

When you’re in your 60s, you may spend a little more time considering what will happen to your assets when you’re no longer here or if you lose the capacity to make important decisions. It’s a smart move to take these difficult considerations seriously.

You may have a range of beneficiaries in mind. Getting the timing right to offload your assets will be critical, as will understanding the amounts of tax that you or a beneficiary may have to pay.

Incorporating all these issues into your retirement planning strategy is a sound investment. Your PAC Financial planners in Brisbane can help, so talk to one of the team about estate planning today.

Help With Financial Planning in Your 60s

PAC Financial has a team of experts who can help you with retirement planning. We’re across all the latest rules and regulations from the ATO, which may affect your super. Financial planning for retirement becomes critical in your 60s, so talk to a PAC Financial planner in Brisbane or any of our financial advisers about your situation.

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