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Speaker 1: My name is Tatasha Bamblet. I'm a proud First Nations

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Speaker 1: woman and I'm here to acknowledge country t Glenn Young Ganya, Niana,

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Speaker 1: Kaka yah y and beIN Ahaka Nian our gay In Mbina,

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Speaker 1: yakarum jar Dominyamiga Umagahawakaman damon Imlan Bumba bang Gadabomba in

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Speaker 1: and now in wakah ghana on yak rum jar Watnadaa. Hello,

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Speaker 1: beautiful friends, we gather on the lands of the Aboriginal people.

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Speaker 1: We thank acknowledge and respect the Abiginal people's land that

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Speaker 1: we're gathering on today. Take pleasure in all the land

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Speaker 1: and respect all that you see. She's on the Money

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Speaker 1: podcast acknowledges culture, country, community and connections, bringing you the tools,

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Speaker 1: knowledge and resources for you to thrive.

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Speaker 2: She's on the Money. She's on the Money.

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Speaker 3: Hello, and welcome to She's on the Money, the podcast

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Speaker 3: that's here to tell you whether your super is giving

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Speaker 3: future freedom or coasting.

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Speaker 2: Without a game plan yet.

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Speaker 3: Today's episode was inspired by our community member Fiona, who

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Speaker 3: slid into our Spotify comments and asked, do you have

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Speaker 3: an episode on the minimum super people should have for

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Speaker 3: their age seems to vary when you google it.

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Speaker 2: Great question.

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Speaker 3: I'm bexcited and here to help us get to the

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Speaker 3: bottom of this with me is the woman who is

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Speaker 3: always telling me that superannuation is very sexy.

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Speaker 2: It's just very, very very sexy. Beck, I'm yet to see. No,

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Speaker 2: you're not.

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Speaker 3: You used to work in superannuation and this is something

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Speaker 3: we should be genuinely, I'm so wildly passionate about this

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Speaker 3: right because this is what's setting us up for future

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Speaker 3: financial success. But it's also something that keeps coming up

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Speaker 3: because a lot of us in this demographic are having

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Speaker 3: parents that are starting to talk about retirement, that are

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Speaker 3: starting to talk about how much they need in supernuation

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Speaker 3: for a comfortable retirement. And when you start googling it,

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Speaker 3: the numbers are so confusing, and they start talking about, oh, well,

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Speaker 3: this is the average for women at this age, and

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Speaker 3: this is the average for men at this age. That's

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Speaker 3: not the average of what you need, Beck, That's just

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Speaker 3: the average of what people retire with. And it frustrates

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Speaker 3: me as an ex financial advisor because durant a little

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Speaker 3: bit at the start of this episode, superranuation as a

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Speaker 3: concept was not compulsory until nineteen ninety two. Right, So,

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Speaker 3: for a lot of our parents and a lot of

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Speaker 3: our older community members, they worked for a very long

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Speaker 3: time without contributing anything to supranuation. So when we get

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Speaker 3: numbers that say the average woman retires with X, that's

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Speaker 3: not taking into consideration what the average female needs. It's

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Speaker 3: taking into consideration just what people are retiring with on average,

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Speaker 3: after most of them didn't actually contribute for their entire

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Speaker 3: working lives.

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Speaker 2: Sure, so moneywin. For most of us millennials and gens.

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Speaker 3: We are working for our entire lives and contributing to

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Speaker 3: supranuation at the same time. So we are already in

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Speaker 3: a better position than most of our parents purely because.

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Speaker 2: Of our consistent contributions. Yeah, so, like that's a win.

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Speaker 2: But still, how much do you need? Beck, that's the question?

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Speaker 2: Do you need? How do you work out what do

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Speaker 2: you need? What's the age pension? How does that work? Like?

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Speaker 2: At what point would we get that?

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Speaker 3: Yeah? Okay, so is it like government figures or something

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Speaker 3: else we should be looking at.

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Speaker 1: Yeah?

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Speaker 3: So, I mean, the government does put out a lot

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Speaker 3: of resources, and they are very good resources if you

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Speaker 3: know how to use them and what to key into them.

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Speaker 3: But more often than not, we don't know where we're starting, right.

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Speaker 3: So the Association of Superbranuation Funds of Australia, which you've

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Speaker 3: probably never heard about nor will you ever care about,

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Speaker 3: but I do, or the ASFA for short, they are

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Speaker 3: the peak body that represents all subranuation funds in Australia

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Speaker 3: and every single year they release they're what they call

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Speaker 3: like their Superbranuation Standard, which they is Australia's benchmark guide

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Speaker 3: for how much you need to be able to have

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Speaker 3: in retirement or spend in retirement, right, and they update

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Speaker 3: this quarterly so you can consistently check back. So it's

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Speaker 3: not like outdated data that's not taking into consideration the

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Speaker 3: cost of living crisis or like inflation or whatever. It's

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Speaker 3: a very up to date and the most recent one

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Speaker 3: available at the time of us recording this episode BECK

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Speaker 3: was the one that was released in March twenty twenty five,

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Speaker 3: so we're going to use that data and everything is

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Speaker 3: in today's dollar. Right. So if we look at the

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Speaker 3: ASFA retirement standards, if you are a homeowner, so if

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Speaker 3: you already own your home and you want to have

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Speaker 3: what they call a comfortable lifestyle by the time you retire,

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Speaker 3: and today retirement age it used to be sixty five,

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Speaker 3: it's now classified as sixty seven. By the time you

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Speaker 3: reach the age of sixty seven. If you are single,

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Speaker 3: they recommend that you have five hundred and ninety f

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Speaker 3: five thousand dollars in your superannuation.

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Speaker 2: Okay, right, yes, If you.

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Speaker 3: Are in a couple, that number is six hundred and

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Speaker 3: ninety thousand dollars together together, okay, which is I would

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Speaker 3: say comforting, because like, if you are in a couple,

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Speaker 3: you obviously need less. And I think that that is

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Speaker 3: It's interesting because we'll get into it a little bit

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Speaker 3: further because this is what they say is a comfortable retirement.

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Speaker 2: But I think you and I might disagree. I think

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Speaker 2: it does take into account like the cost of living. Yeah,

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Speaker 2: it does, it does.

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Speaker 3: So that is based on and they say every single year,

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Speaker 3: a single person will spend fifty two thousand, three hundred

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Speaker 3: and eighty three dollars, not including mortgage because we already

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Speaker 3: a home owner, yes, yes, yes, and they're hoping that

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Speaker 3: you've paid it. And as a couple, you'll be spending

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Speaker 3: seventy three thousand, eight hundred and seventy five dollars and

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Speaker 3: that covers like they've taken into consideration for a comfortable lifestyle.

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Speaker 3: That means that you can pay for private health insurance,

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Speaker 3: you are paying for a reliable car to stay on

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Speaker 3: the roads.

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Speaker 2: You have like regular leisure activities.

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Speaker 3: So they're assuming that you do dine out, and you

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Speaker 3: do go on holidays, and you might go to the

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Speaker 3: local swim center every week, like water aerobics whatever. It

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Speaker 3: includes home maintenance and some upgrades as you might need them, sure,

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Speaker 3: and then digital connectivity, so like they're including things like Netflix,

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Speaker 3: they're including streaming services, they're including your internet.

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Speaker 2: So they're not delusional, if that makes sense.

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Speaker 3: It's not as though they're looking at this and going, oh,

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Speaker 3: comfortable retirement and they're still using figures based in nineteen

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Speaker 3: ninety five, Like that's not it, Like they genuinely do

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Speaker 3: look at it. But then they recommend a modest lifestyle

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Speaker 3: as well. So every time the ASFA release data, that

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Speaker 3: will release a modest lifestyle, and then like a comfortable

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Speaker 3: lifestyle and a comfortable lifestyle is more money than a

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Speaker 3: modesty modest is like I would say you can put

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Speaker 3: food on the table, yeah, and they say that a

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Speaker 3: superbalance needed it retirement for a modest lifestyle. And we

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Speaker 3: also need to take into consideration that the modest lifestyle

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Speaker 3: figures assume that you don't have lots of stuff, Like

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Speaker 3: you don't have a lot of assets. You also don't

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Speaker 3: have a lot of superannuation. And it means that they

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Speaker 3: assume that you are going to rely on the age pension,

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Speaker 3: and that age pension is going to work with your superranuation.

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Speaker 3: You super will kind of top it up a little

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Speaker 3: bit sure every single year. So they think that a

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Speaker 3: single or a couple will approximately have about one hundred

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Speaker 3: thousand dollars in super.

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Speaker 2: Okay, Okay, that's some more. Do I think a lot

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Speaker 2: of people assumed that I would come on here and

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Speaker 2: be like, you need one point two million dollars in

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Speaker 2: sobrainuation there I certainly did. Gol, if you want one

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Speaker 2: point two million dollars, I can help you get there.

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Speaker 3: I got the tools sick I can. I can teach you,

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Speaker 3: but like, we also want to be realistic. Yeah, So

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Speaker 3: that means that a single person would on average spend

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Speaker 3: thirty three thousand, three hundred and eighty six dollars per year,

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Speaker 3: and a couple would spend forty eight thousand, one hundred

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Speaker 3: and eighty four dollars okay, per year, and that covers

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Speaker 3: a lot of things. And just a quick are we

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Speaker 3: still talking about homeowners? So these people in the bucket

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Speaker 3: right now, Yeah, they've got one hundred grand in super

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Speaker 3: but they've also got a home paid off, so they're

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Speaker 3: not paying rent, they're not paying mortgage. Like the assumption

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Speaker 3: is that by retirement you paid off your home in full,

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Speaker 3: and for a lot of people that is actually the reality,

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Speaker 3: especially for boomers. I don't know if calling them boomers

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Speaker 3: is nice, but you know, for our parents' generation, Beck,

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Speaker 3: a lot of them haven't contributed more to superannuation. They've

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Speaker 3: really prioritized debt reduction. They've prioritized paying off their family home.

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Speaker 3: They are now completely debt free. They're ready to retire,

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Speaker 3: but like they don't have heaps in super sure And

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Speaker 3: that's okay. But what a modest retirement covers is you

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Speaker 3: still can afford basic private health insurance. The government really

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Speaker 3: prioritizes that limited leisure activities, so not so many trips,

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Speaker 3: but you are able to go to like the pool

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Speaker 3: and get a coffee out and stuff like that. Older

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Speaker 3: more basic car and then household goods and services. So

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Speaker 3: we're not paying for upgrades to the house, we're not

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Speaker 3: going on holidays, but like we can put a roof

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Speaker 3: over our head and food on the table every single week.

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Speaker 3: That's all you need, baby, And just to like recap,

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Speaker 3: there are a number of assumptions that for the modest

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Speaker 3: and the comfortable lifestyle, there are a number of assumptions

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Speaker 3: that the ASFA have made. And reminding you that those

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Speaker 3: retirees have paid for their house in full, completely at right,

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Speaker 3: no debt, no mortgage, no rent, that they retire at

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Speaker 3: age sixty five, and then they live to eighty five. Okay,

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Speaker 3: so we are living for twenty years after we sell

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Speaker 3: our house.

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Speaker 2: That's so morbid, doesn't it? Well, it does, But.

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Speaker 3: Then the reality of that situation is we're starting to

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Speaker 3: live longer. Yeah, So, like, are these predictions actually reflective

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Speaker 3: of what we're going to need?

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Speaker 2: What if I live to eighty six? See, what do

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Speaker 2: you do? You run out of money?

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Speaker 3: What if, like my icon of a grandpa, I lived

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Speaker 3: to ninety four or he was like literally like a

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Speaker 3: few days away from being ninety five.

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Speaker 2: Oh that's an additional ten years. Yeah, yeah, I need

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Speaker 2: to pay for Yeah, it's just a that's a while

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Speaker 2: that they're like, you'll probably DIEDT five. It's like, no,

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Speaker 2: I don't know a lot of people that are.

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Speaker 3: And there's another assumption that they will both receive part

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Speaker 3: of an age pension. So for the modest lifestyle it's

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Speaker 3: a full pension and for the comfortable lifestyle it's part

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Speaker 3: of an age pension. And then instead of having their

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Speaker 3: superannuation sit there and you might have heard me talk about,

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Speaker 3: you know, it's fantastic because when you invest money, Beck,

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Speaker 3: the money that you've invested then makes money. And in

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Speaker 3: a perfect world, we never spend the money that we

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Speaker 3: have invested. We always live off the income. Yeah, but

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Speaker 3: it actually assumes draw down because we don't have that

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Speaker 3: grace Like if you only have one hundred thousand dollars

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Speaker 3: in super and that's returning what five percent every year?

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Speaker 3: So five percent is what a financial advisor will use

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Speaker 3: as a draw down rule because we know that the

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Speaker 3: average and I'm going to go off on a tangent here,

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Speaker 3: I do apologize the average of the Australian share market

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Speaker 3: returns closer to ten percent every year, but it's not consistent, right,

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Speaker 3: so some years the market might be off some years,

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Speaker 3: the market might be an absolute bullmarket and it's having

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Speaker 3: a really great time. But when you're a financial advisor,

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Speaker 3: the advice is that you use an average rate or

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Speaker 3: a draw down rate of five percent, because that's quite conservative,

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Speaker 3: and it means that if it's a shitty year, Beck,

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Speaker 3: we're going to be okay, and if it's a good year,

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Speaker 3: there'll be some cash left over in your super for

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Speaker 3: the other years that aren't as good.

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Speaker 2: Right, So we use five percent.

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Speaker 3: But if you've only got one hundred thousand dollars in superannuation,

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Speaker 3: five percent of that bex five grand.

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Speaker 2: A year, you can't live off that.

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Speaker 3: So you have to start taking some of the actual

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Speaker 3: investment out so that you can live your life. And

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Speaker 3: so every year you start to cut into that investment,

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Speaker 3: and then the returns start to diminish as well. I'm

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Speaker 3: not saying that that's scary. That is the reality for

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Speaker 3: most people. I just want you to fully understand what

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Speaker 3: that means and why and when and where and how.

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Speaker 2: Okay, okay.

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Speaker 3: On the flip side, not all of us own property,

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Speaker 3: not all of our parents' own property, And the reality

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Speaker 3: is for a lot of people, you're going to rent

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Speaker 3: for life, that's fine.

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Speaker 2: There's literally no shame in that. We just have to

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Speaker 2: financially prepare for it.

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Speaker 3: Yeah, because if we've got rent as another overhead, like,

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Speaker 3: we just need to factor that in because housing is

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Speaker 3: a major cost. The ASFA actually publishes completely separate figures

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Speaker 3: for retirees who do own their homes versus retirees who

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Speaker 3: don't own their homes in retirement, which I think is

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Speaker 3: really responsible. And there's no quote comfortable lifestyle benchmark provided

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Speaker 3: for that because I think they well, I think they

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Speaker 3: realize that if you're going to be renting for life,

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Speaker 3: that's a significantly it's harder, like it's harder to rent

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Speaker 3: and put food on the table and have that income.

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Speaker 3: Like if you were in the comfortable bucket, maybe we

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Speaker 3: could get a mortgage. So all they give us is

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Speaker 3: the modest lifestyle for that fair enough. So a souberannuation

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Speaker 3: balance at the quote retirement age of sixty seven for

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Speaker 3: a single is three hundred and forty thousand dollars and

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Speaker 3: for a couple it's three hundred and eighty five thousand dollars.

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Speaker 3: And then for their annual spending, because they're going to

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Speaker 3: spend a bit more because they're renting as well. For

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Speaker 3: a single person, they're spending forty six thousand, six hundred

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Speaker 3: and sixty three dollars a year, and for a couple

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Speaker 3: it's sixty four thousand, two hundred and fifty nine dollars

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Speaker 3: a year. This just tells me that financially, being in

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Speaker 3: a couple makes sense. Isn't that sucky? I know? But

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Speaker 3: also I'm like, it's not that much different to be single,

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Speaker 3: and I like, I just I don't think we need

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Speaker 3: to be in a couple. So I'm like, this is

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Speaker 3: still because I'm looking at the single fore years, even

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Speaker 3: though I'm not single right now.

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Speaker 2: But I'm like, I don't want to plan for being

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Speaker 2: in a couple. I think this is still very doable.

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Speaker 3: And I say so, the extra cost assumed if you're renting,

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Speaker 3: if you're a single person is thirteen thousand, two hundred

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Speaker 3: and seventy seven dollars a year, and then they think

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Speaker 3: that if you're in a couple, you're probably spending slightly more,

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Speaker 3: and you're spending sixteen thousand and seventy five dollars on rent,

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Speaker 3: and the rent assumed on that is each week, And

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Speaker 3: I don't think this is enough personally, but each week

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Speaker 3: they assume that you're spending three hundred and eighty bucks

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Speaker 3: a week.

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Speaker 2: They're getting this, yeah, let me just disclaim it.

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Speaker 3: The I don't agree, but living sticks as a single person,

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Speaker 3: and then as a couple, they think you're spending four

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Speaker 3: hundred and fifty bucks.

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Speaker 2: That's how much it should be.

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Speaker 3: And there's I'm not going to go on our tangent,

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Speaker 3: but I just don't think anyone's doing about this rental

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Speaker 3: crisis general in I remember my rent in like twenty

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Speaker 3: fifteen was four hundred and fifty dollars a week, and

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Speaker 3: at that time that was so expensive.

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Speaker 2: Yes, yes I was.

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Speaker 3: Sharing with someone else, don't worry, but like that felt

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Speaker 3: like a lot at that time. And I know that

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Speaker 3: rent nowadays, and like it's not that I don't understand

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Speaker 3: the rental market. Guys at work in property, I really

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Speaker 3: do get it. But it just it blows my mind

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Speaker 3: that those are still the figures that they're using and

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Speaker 3: like projecting on, because if you reflect, go back and

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Speaker 3: they've assumed that you're like will go on the single one, right,

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Speaker 3: they've assumed your annual spending is forty six thousand, six

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Speaker 3: hundred and sixty three dollars, but of that, you're spending

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Speaker 3: only three hundred and eighty dollars on rent. Girl, You're

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Speaker 3: not going to be spending three hundred and eighty dollars

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Speaker 3: on rent. I would say half of that is going

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Speaker 3: to go on rent, and then what unless you're in

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Speaker 3: a sharehouse, which I can kind of understand, But.

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Speaker 2: Are you're going to be sixty five and you're in

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Speaker 2: a sharehouse? I would absolutely. I know you're much.

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Speaker 3: Cooler than everybody, but like I think a lot of

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Speaker 3: us by the time we were retiring, that's not what

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Speaker 3: we want. Sure, that's not what the average person wants.

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Speaker 3: And I know that you're probably like.

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Speaker 2: Oh what about like leave blah laugh, Yeah, but like

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Speaker 2: I love it, and you can choose that. That's fantastic,

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Speaker 2: But some people they're in space.

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Speaker 3: You deserve your own space, You deserve the financial freedom

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Speaker 3: that if that is what you want to choose, you

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Speaker 3: get that.

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Speaker 2: I know, isn't that crazy.

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Speaker 3: I remember looking for rentals with my mum when I

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Speaker 3: was like, I don't know, a teenager three fifty for

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Speaker 3: a four bedroom house.

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Speaker 2: Now it's like over one thousand. I'm like, I'm so sorry.

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Speaker 2: To single parents out there.

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Speaker 3: So these numbers are all in today's costs, right, And

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Speaker 3: I just told you about my rent back in twenty

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Speaker 3: fifteen being four fifty, Like, we kind of know that

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Speaker 3: their projection of three hundred and eighty next year, it's

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Speaker 3: going to be four hundred. The year after that's going

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Speaker 3: to be four ten, right, So we need to take

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Speaker 3: that into consideration as well, because these numbers from my perspective,

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Speaker 3: mean they're not adjusting for future inflation or like you

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Speaker 3: know I mentioned before, we're living longer, so like rising

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Speaker 3: life expectancy or even just more housing insecurity. Like this

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Speaker 3: is just I think, Yes, I get that they have

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Speaker 3: to put out their bare minimum for everybody in Australia,

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Speaker 3: and most of us listening to this podcast probably live

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Speaker 3: in a major city or regionally relatively comfortably. I would

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Speaker 3: say that we need to remember that a lot of

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Speaker 3: remote communities are piled into this as well, which is

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Speaker 3: why the average comes down. And so I mean, if

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Speaker 3: you're thirty today and you're planning to retire at the

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Speaker 3: retirement age of sixty seven, the five hundred and ninety

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Speaker 3: five thousand dollars for your comfortable lifestyle figure, I would say,

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Speaker 3: is a conceptual baseline, not the actual target, because we

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Speaker 3: need to adjust for inflation. So that's what you would

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Speaker 3: need beck to retire today.

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Speaker 2: You got you got you Okay.

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Speaker 3: So if you're thirty or around that and you go

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Speaker 3: into a super right now you're super cout and you

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Speaker 3: check how much you have, I guess.

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Speaker 2: It's hard to say, but what would that figure look like? Yeah,

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Speaker 2: so I have those figures.

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Speaker 3: So I've got superannuation balances by age and gender, and

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Speaker 3: we can quickly go across that. So if you are

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Speaker 3: between the age of eighteen to twenty four, I'm just

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Speaker 3: going to base it on females because the male actually

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Speaker 3: I'll tell you both, right, sure, So the average account

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Speaker 3: balance for someone between the age of eighteen to twenty

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Speaker 3: four is seven thousand, two hundred and ninety seven dollars

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Speaker 3: if they're a female, and eight thousand and sixty nine

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Speaker 3: dollars if you're a male. Obviously, in our community, they

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Speaker 3: actually sit between the ages of twenty five to thirty five,

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Speaker 3: and there's a bit of variance. So if you are

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Speaker 3: between the age of twenty five to twenty nine and

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Speaker 3: you're a female, the average is twenty three thousand, two

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00:18:05,720 --> 00:18:08,240
Speaker 3: hundred and seventy three dollars. If you are male, it

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Speaker 3: is twenty five thousand, four hundred and seven dollars as

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Speaker 3: the average. If you are and I'm just going to

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Speaker 3: jump up to thirty five to thirty nine, that jumps

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Speaker 3: to seventy one thousand, six hundred and eighty six dollars

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Speaker 3: as the average female account. And then if you're male,

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Speaker 3: and this is where things start to slip with my

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Speaker 3: big genka. Absolutely, if you're a male, your average account

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Speaker 3: balance if you're between the age of thirty five to

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Speaker 3: thirty nineties ninety thousand, eight hundred and twenty two dollars.

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Speaker 3: If we jump back up to what retirement age is,

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Speaker 3: So retirement age is sixty seven in Australia, So if

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Speaker 3: you are between the age of sixty five and sixty nine,

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Speaker 3: the average account balance is three hundred and seventy nine thousand,

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Speaker 3: four hundred and eighty three dollars, and you go, that's

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Speaker 3: pretty good.

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Speaker 2: That's for females.

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Speaker 3: If you're a male between the ages seventy five and

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Speaker 3: sixty nine and the average is four hundred and twenty

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Speaker 3: eight five hundred and thirty three, that's just telling me

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Speaker 3: that obviously there is a gender pay gap, full stop.

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Speaker 2: End of story.

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Speaker 3: Women are retiring consistently with less superannuation than men on

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Speaker 3: that website. So we were talking about the ASFA before.

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Speaker 3: There's actually a very cool research tool called Superdetective. So

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Speaker 3: the Superdetective tool will let you put your age in

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Speaker 3: and then it will tell you how much you need

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Speaker 3: to have today beck to hit their comfortable retirement or

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Speaker 3: their modest retirement ages. Right, And I'll tell you a

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Speaker 3: bit after this because I'm going to get into it.

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Speaker 3: There's a number of different calculators you can use as

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Speaker 3: well that will show you where you need to be

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Speaker 3: and what that means. Yeah, okay, okay, so wow, it's

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Speaker 3: a big numbers game today. What other numbers might we see?

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Speaker 2: Okay? So you might have heard the rule and a

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Speaker 2: lot of.

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Speaker 3: Financial advisors use this a lot of websites, a lot

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Speaker 3: of blogs. They say you need to have seventy percent

401
00:19:54,200 --> 00:19:57,200
Speaker 3: of your income. And it's a rule that I would

402
00:19:57,200 --> 00:20:00,760
Speaker 3: say is one of the most commonly quoted shortcuts for

403
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Speaker 3: estimating how much money you'll need to live on in retirement.

404
00:20:04,280 --> 00:20:06,359
Speaker 3: But I would say that it comes with some I

405
00:20:06,400 --> 00:20:07,960
Speaker 3: don't know, there's just like a lot of pros and

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Speaker 3: cons and some pretty big assumptions that are baked into that.

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Speaker 2: So let's quickly have a chat about it. I suppose yes, please.

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Speaker 3: I've written a little bit of a pros and cons

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Speaker 3: list because I don't want to bore you too much,

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00:20:17,600 --> 00:20:19,800
Speaker 3: because I feel like this episode is very like numbers,

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Speaker 3: and like he's the median and here's the aide.

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Speaker 2: Do you know what I mean?

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Speaker 3: It's just this a lot, but the pros of the

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Speaker 3: seventy per cent rule, it's relatively easy, Like, it's pretty quick.

415
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Speaker 3: Just calculate seventy percent of your income. You don't have

416
00:20:30,440 --> 00:20:32,439
Speaker 3: to pull out some spreadsheets, you don't have to crush

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00:20:32,520 --> 00:20:34,680
Speaker 3: your dreams. You don't have to, you know, work out

418
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Speaker 3: what your retirement budget is and you're crunching the numbers

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Speaker 3: all night. It actually just gives you a rough ballpark

420
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Speaker 3: in I would say seconds, sure, money you in. We

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Speaker 3: love to see it, easy times money. It takes into

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Speaker 3: account reduced expenses so within retirement hopefully.

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Speaker 2: Hopefully, and we've got our fingers crossed.

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Speaker 3: You're not paying off a mortgage, you don't have young

425
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Speaker 3: kids to raise, you're not paying school fees, you're not

426
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Speaker 3: paying for school camp. You're not commuting daily, so we're

427
00:20:59,240 --> 00:21:01,440
Speaker 3: not spending lots on my key to go in and

428
00:21:01,560 --> 00:21:04,680
Speaker 3: out of the big smoke. You're not making big superannuation

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Speaker 3: contributions because you're already retired, right, So the idea is

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Speaker 3: that your income will shrink a bit, and that's okay.

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Speaker 3: And for me when I was working as a financial advisor,

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Speaker 3: it's a pretty healthy conversation starter. It's a pretty healthy

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Speaker 3: starting point, especially for people in their twenties to forties

434
00:21:22,840 --> 00:21:25,080
Speaker 3: who maybe haven't thought a lot about retirement but want

435
00:21:25,080 --> 00:21:27,000
Speaker 3: to kind of sense check. Like if I sat you

436
00:21:27,040 --> 00:21:28,919
Speaker 3: down and said, all right, beck, well let's talk about retirement,

437
00:21:28,920 --> 00:21:30,920
Speaker 3: you might go, I don't even know where to start

438
00:21:31,080 --> 00:21:32,920
Speaker 3: the yeah, And I go, okay, cool. Will that start

439
00:21:32,920 --> 00:21:36,200
Speaker 3: with the seventy percent rule? And I explained that that's

440
00:21:36,520 --> 00:21:38,520
Speaker 3: you know, you living off seventy percent of your income.

441
00:21:38,640 --> 00:21:40,880
Speaker 3: Or we can start having a conversation about how comfortable

442
00:21:40,920 --> 00:21:42,680
Speaker 3: you'd be, could you would you?

443
00:21:43,200 --> 00:21:44,200
Speaker 2: Would you want more than that?

444
00:21:44,560 --> 00:21:47,400
Speaker 3: But I don't know if you've got some bougie retirement plans, babe,

445
00:21:47,800 --> 00:21:49,600
Speaker 3: you're going to go get like a yacht off the

446
00:21:49,720 --> 00:21:52,880
Speaker 3: coast of France, like I don't know what your plans are. Yeah,

447
00:21:53,040 --> 00:21:56,520
Speaker 3: so it kind of jump starts that conversation into would

448
00:21:56,600 --> 00:22:00,320
Speaker 3: that be appropriate? What should we be predicting, what should

449
00:22:00,320 --> 00:22:03,359
Speaker 3: we be organizing? Sure, on the flip side, though, there

450
00:22:03,440 --> 00:22:06,639
Speaker 3: are some cons it's not very personalized, like it doesn't

451
00:22:06,680 --> 00:22:08,680
Speaker 3: consider whether you're going to own your own home or

452
00:22:08,760 --> 00:22:10,480
Speaker 3: if you're going to rent forever, or what kind of

453
00:22:10,560 --> 00:22:12,919
Speaker 3: retirement lifestyle. Like we're not talking about whether you're going

454
00:22:12,960 --> 00:22:14,760
Speaker 3: to get a yacht or if you're going to caravan

455
00:22:14,800 --> 00:22:18,080
Speaker 3: around Australia. Like we're not having these conversations like are

456
00:22:18,119 --> 00:22:20,200
Speaker 3: you a super minimalist, Are you're going to go completely

457
00:22:20,280 --> 00:22:22,400
Speaker 3: off gridter you're not even get a plan to need

458
00:22:22,520 --> 00:22:24,800
Speaker 3: money because you're growing all your own vegs, Like, I

459
00:22:24,840 --> 00:22:28,000
Speaker 3: don't know that's the dream, But everybody's got their own plans, right.

460
00:22:28,080 --> 00:22:31,480
Speaker 3: It's not very personal It doesn't talk about the age

461
00:22:31,560 --> 00:22:37,480
Speaker 3: pension at all, and the reality is most Australians are

462
00:22:37,720 --> 00:22:41,080
Speaker 3: going to need to rely on the aged pension and

463
00:22:41,200 --> 00:22:44,760
Speaker 3: the seventy percent rule assumes that your income is entirely

464
00:22:44,880 --> 00:22:50,280
Speaker 3: coming from your savings, your investments and your superannuation. So

465
00:22:50,560 --> 00:22:53,920
Speaker 3: I would say it might overestimate how much money you

466
00:22:54,080 --> 00:22:55,560
Speaker 3: need in retirement.

467
00:22:55,560 --> 00:22:59,040
Speaker 2: That's good unless it's daunting. Yeah, but like it could

468
00:22:59,080 --> 00:22:59,919
Speaker 2: be really scary.

469
00:23:00,240 --> 00:23:02,800
Speaker 3: Yeah, that's like you know, like hypothetically, if I was

470
00:23:02,840 --> 00:23:05,680
Speaker 3: helping my parents retire and they were stressed about it,

471
00:23:06,040 --> 00:23:07,600
Speaker 3: and I was sitting them down, and I'm like, well,

472
00:23:07,680 --> 00:23:09,960
Speaker 3: seventy percent rule, and then we calculate what that is

473
00:23:10,200 --> 00:23:13,080
Speaker 3: for how much they needed in super, that very quickly

474
00:23:13,200 --> 00:23:16,320
Speaker 3: becomes very overwhelming because they might not have access to that.

475
00:23:16,880 --> 00:23:17,640
Speaker 2: Yeah, do you know what I mean?

476
00:23:17,800 --> 00:23:20,399
Speaker 3: Like we're not talking about the resources and the support

477
00:23:20,480 --> 00:23:22,720
Speaker 3: and the age pension and how you know, the super

478
00:23:22,800 --> 00:23:24,840
Speaker 3: could just act as a top up as opposed to

479
00:23:25,000 --> 00:23:29,159
Speaker 3: the primary income. It also, high owners are relatively skewed.

480
00:23:29,280 --> 00:23:31,480
Speaker 3: So like, girl, if you're earning two hundred grand a

481
00:23:31,600 --> 00:23:34,480
Speaker 3: year right now, do you actually need one hundred and

482
00:23:34,560 --> 00:23:36,000
Speaker 3: forty grand a year in retirement?

483
00:23:37,320 --> 00:23:40,200
Speaker 2: Like probably not, No, I wouldn't think so.

484
00:23:40,440 --> 00:23:42,639
Speaker 3: No, you probably set yourself up, You probably paid off

485
00:23:42,680 --> 00:23:44,840
Speaker 3: your entire house, and like, if you are living a

486
00:23:44,920 --> 00:23:47,400
Speaker 3: minimalist life, you probably don't need one hundred and forty

487
00:23:47,440 --> 00:23:50,240
Speaker 3: thousand dollars in income. Yeah, So I would say the

488
00:23:50,320 --> 00:23:54,800
Speaker 3: percentage doesn't scale well across lots of different types of incomes.

489
00:23:55,160 --> 00:23:57,320
Speaker 2: Sure, okay, so how do we actually work out the

490
00:23:57,400 --> 00:23:58,520
Speaker 2: right figure for us?

491
00:23:58,920 --> 00:24:01,919
Speaker 3: So you probably figured out by now from this conversation

492
00:24:02,080 --> 00:24:04,960
Speaker 3: that we've been having that's superannuation and retirement. It's definitely

493
00:24:05,040 --> 00:24:07,840
Speaker 3: not like a one size fits all approach, and that's

494
00:24:08,359 --> 00:24:10,080
Speaker 3: why I love.

495
00:24:09,960 --> 00:24:12,119
Speaker 2: And I hate it. Like everyone's different, so we should

496
00:24:12,119 --> 00:24:12,560
Speaker 2: embrace that.

497
00:24:12,680 --> 00:24:14,200
Speaker 3: But also I wish I just had a rule like

498
00:24:14,280 --> 00:24:16,159
Speaker 3: you'll give you back, Like if I could be like,

499
00:24:16,680 --> 00:24:19,360
Speaker 3: oh yeah, fully get back behind the seventy percent rule

500
00:24:19,520 --> 00:24:21,919
Speaker 3: money ween, it works for everybody, Like how much easier

501
00:24:21,920 --> 00:24:22,440
Speaker 3: would that be?

502
00:24:22,960 --> 00:24:25,440
Speaker 2: As an episode? That would have been so much easier

503
00:24:25,680 --> 00:24:27,879
Speaker 2: to be done. Here's the rule, this is the number,

504
00:24:28,160 --> 00:24:29,439
Speaker 2: this is what you're working towards.

505
00:24:29,520 --> 00:24:31,920
Speaker 3: And if I could turn around and be like, okay, cool,

506
00:24:31,960 --> 00:24:35,360
Speaker 3: at retirement, you need this amount of money, how much

507
00:24:35,400 --> 00:24:36,000
Speaker 3: easier would my.

508
00:24:36,040 --> 00:24:38,720
Speaker 2: Life and your life be? Oh, I'll just go towards

509
00:24:38,760 --> 00:24:39,360
Speaker 2: that slavy.

510
00:24:39,920 --> 00:24:41,959
Speaker 3: So, because it's not a one size fits all approach,

511
00:24:42,160 --> 00:24:43,880
Speaker 3: and because we've been yapping for a while, I think

512
00:24:43,920 --> 00:24:45,960
Speaker 3: you and I let's take a really quick break, and

513
00:24:46,000 --> 00:24:48,400
Speaker 3: when we're back, I'm actually going to help you work

514
00:24:48,440 --> 00:24:50,520
Speaker 3: out what your magic number is and then give you

515
00:24:50,600 --> 00:24:53,640
Speaker 3: a game plan to actually get there. So don't go anywhere,

516
00:24:57,800 --> 00:24:59,680
Speaker 3: all right, V before the break, you promised to help

517
00:24:59,760 --> 00:25:02,520
Speaker 3: us fe about the rights of balance for our life promises,

518
00:25:02,840 --> 00:25:03,840
Speaker 3: not just averages.

519
00:25:04,400 --> 00:25:08,000
Speaker 2: That sounds like a mammoth task. So where do we begin?

520
00:25:08,200 --> 00:25:10,080
Speaker 3: Okay, So what we want to do is kind of

521
00:25:10,160 --> 00:25:12,600
Speaker 3: like you know how saying the seventy percent rule is

522
00:25:12,680 --> 00:25:15,280
Speaker 3: a really good rule for kick starting conversation.

523
00:25:15,560 --> 00:25:17,440
Speaker 2: Yes, ma'am. We want to just get clear on what

524
00:25:17,600 --> 00:25:18,400
Speaker 2: retirement means.

525
00:25:18,920 --> 00:25:21,440
Speaker 3: What's that mean for you? Like are you going off grid?

526
00:25:22,000 --> 00:25:24,359
Speaker 3: What would that cost? Are you growing all your own veggies?

527
00:25:24,400 --> 00:25:26,520
Speaker 3: What type of income would you need? On the flip side,

528
00:25:26,520 --> 00:25:28,240
Speaker 3: are we going to the South of France? And like

529
00:25:28,520 --> 00:25:31,080
Speaker 3: these are very And I use those examples because like

530
00:25:31,119 --> 00:25:32,800
Speaker 3: when I was a financial advisor, this is how I

531
00:25:32,920 --> 00:25:35,280
Speaker 3: talk to clients. So I'd be like, go, what's the plan? Yeah,

532
00:25:35,440 --> 00:25:37,639
Speaker 3: and then all of a sudden you go, no, I

533
00:25:37,680 --> 00:25:39,360
Speaker 3: don't need to go to the South of France. You'd

534
00:25:39,359 --> 00:25:42,119
Speaker 3: be like, okay, cool, what does retirement look like? And

535
00:25:42,200 --> 00:25:44,720
Speaker 3: then all of a sudden, it's much easier conversation to

536
00:25:44,760 --> 00:25:48,760
Speaker 3: go well, actually maybe and like maybe you're talking to

537
00:25:48,840 --> 00:25:51,080
Speaker 3: someone in their sixties, right, and they've just started having

538
00:25:51,119 --> 00:25:55,359
Speaker 3: grandchildren and they're really excited about just spending more time

539
00:25:55,400 --> 00:25:58,639
Speaker 3: with the grandkids. Like they're like, oh, like, hopefully I

540
00:25:58,760 --> 00:26:00,520
Speaker 3: can have them one day week. We'll go to the

541
00:26:00,600 --> 00:26:03,800
Speaker 3: cafe and like, what do holidays look like? And you know,

542
00:26:03,920 --> 00:26:05,320
Speaker 3: I used to talk to a lot of people would

543
00:26:05,320 --> 00:26:07,240
Speaker 3: be like, oh, well, I don't actually want to do

544
00:26:07,280 --> 00:26:09,440
Speaker 3: a whole heap of overseas stuff. Maybe they've already done that,

545
00:26:09,520 --> 00:26:11,479
Speaker 3: maybe they don't have an interest in it. They're like, oh,

546
00:26:11,560 --> 00:26:14,800
Speaker 3: maybe like trip to Queensland every year, yeap. Or on

547
00:26:14,840 --> 00:26:16,639
Speaker 3: the flip side, I might have sat down with a

548
00:26:16,680 --> 00:26:18,880
Speaker 3: retirement couple who are like, go, we have been waiting

549
00:26:18,960 --> 00:26:19,119
Speaker 3: for this.

550
00:26:19,359 --> 00:26:20,560
Speaker 2: We want to travel the world.

551
00:26:21,160 --> 00:26:24,040
Speaker 3: Like it's such a good conversation to have, but like,

552
00:26:24,440 --> 00:26:26,520
Speaker 3: right now, what are your retirement plans?

553
00:26:26,560 --> 00:26:27,520
Speaker 2: What could that look like?

554
00:26:27,920 --> 00:26:30,280
Speaker 3: And we want to price up what your lifestyle would

555
00:26:30,320 --> 00:26:33,399
Speaker 3: look like in today's dollars. So today, if you're retired,

556
00:26:33,440 --> 00:26:36,120
Speaker 3: what would that look like? What would your annual spending

557
00:26:36,320 --> 00:26:39,080
Speaker 3: look like? And what is kind of like a realistic

558
00:26:39,200 --> 00:26:42,199
Speaker 3: house cost, Like are you planning on getting a mortgage

559
00:26:42,240 --> 00:26:44,439
Speaker 3: and having it paid off or are you planning on renting?

560
00:26:44,560 --> 00:26:48,639
Speaker 2: Like, what should we be allocating? Sure, okay, okay, So

561
00:26:48,760 --> 00:26:50,280
Speaker 2: we have our annual spending.

562
00:26:50,080 --> 00:26:53,200
Speaker 3: What do we do next? We need to then take

563
00:26:53,280 --> 00:26:55,560
Speaker 3: that and go okay, well, on average, and like, let's

564
00:26:55,600 --> 00:26:58,199
Speaker 3: just pick a number out of the air. Right, on average,

565
00:26:58,240 --> 00:27:01,200
Speaker 3: you've decided beck that you want to spend sixty thousand

566
00:27:01,240 --> 00:27:03,960
Speaker 3: dollars yeap, And now I'm using that number because it's

567
00:27:04,119 --> 00:27:06,840
Speaker 3: higher as a single, because you said that we're going

568
00:27:06,880 --> 00:27:08,760
Speaker 3: to pretend to your single for a hot minute. It's

569
00:27:08,880 --> 00:27:12,520
Speaker 3: higher than the modest and the comfortable lifestyle based on

570
00:27:12,560 --> 00:27:16,240
Speaker 3: the ASFA, right, yeah, so you want to translate that

571
00:27:16,400 --> 00:27:19,920
Speaker 3: and you'll spend into a bull park lump sum. So

572
00:27:20,920 --> 00:27:23,239
Speaker 3: we want to do and we always times it by

573
00:27:23,359 --> 00:27:26,960
Speaker 3: twenty because that's what's going to give us a draw

574
00:27:27,119 --> 00:27:30,359
Speaker 3: down rate of five percent. So if you times anything

575
00:27:30,400 --> 00:27:32,400
Speaker 3: by twenty, you're going to get that five percent number.

576
00:27:32,840 --> 00:27:35,679
Speaker 3: So you let's pretend you want an income of sixty

577
00:27:35,800 --> 00:27:39,840
Speaker 3: thousand dollars. Bet sure, sixty thousand times twenty is going

578
00:27:39,920 --> 00:27:43,119
Speaker 3: to equal one point two million dollars.

579
00:27:43,600 --> 00:27:45,720
Speaker 2: Yeah, okay, okay, okay, And so.

580
00:27:45,840 --> 00:27:49,600
Speaker 3: That one point two million dollars means that every single

581
00:27:49,680 --> 00:27:51,480
Speaker 3: year if you had one point two And I'm not

582
00:27:51,520 --> 00:27:54,000
Speaker 3: trying to scare you because that's like a relatively large number.

583
00:27:54,040 --> 00:27:56,240
Speaker 2: But we're just like working backwards.

584
00:27:55,880 --> 00:27:57,919
Speaker 3: And I think a lot of us, you know, we're

585
00:27:57,960 --> 00:27:59,760
Speaker 3: listening to the Sheese on the Money podcast because we

586
00:27:59,800 --> 00:28:03,000
Speaker 3: want better for ourselves. I can almost guarantee that if

587
00:28:03,040 --> 00:28:04,840
Speaker 3: you are in your thirties right now, or if you're

588
00:28:04,880 --> 00:28:07,399
Speaker 3: in your twenties right now, and I go, how do

589
00:28:07,440 --> 00:28:11,479
Speaker 3: you want to retire, You're not going to say, oh,

590
00:28:11,600 --> 00:28:14,280
Speaker 3: I would just like a modest retirement. Most of us

591
00:28:14,480 --> 00:28:16,240
Speaker 3: want the financial freedom.

592
00:28:16,480 --> 00:28:19,240
Speaker 2: To do whatever we want there. Yeah right, yeah, So.

593
00:28:19,240 --> 00:28:21,000
Speaker 3: I don't want to scare you with these numbers. But

594
00:28:21,119 --> 00:28:26,000
Speaker 3: also these numbers are completely achievable. Right, So we'd need

595
00:28:26,040 --> 00:28:29,960
Speaker 3: an investment of one point two million dollars, assuming that

596
00:28:30,080 --> 00:28:32,560
Speaker 3: we draw down five percent each and every single year,

597
00:28:32,600 --> 00:28:35,640
Speaker 3: and that money doesn't remain income generating.

598
00:28:35,720 --> 00:28:37,520
Speaker 2: I just want to double check. Draw down means like

599
00:28:37,680 --> 00:28:39,400
Speaker 2: just take out take out, Okay, yep.

600
00:28:39,520 --> 00:28:42,400
Speaker 3: Drawdown is just taking that cash out. So every single

601
00:28:42,560 --> 00:28:45,120
Speaker 3: year you would take that cash out. And the reason is,

602
00:28:45,240 --> 00:28:47,920
Speaker 3: remember we said you retire at sixty five, yes, and

603
00:28:48,000 --> 00:28:48,920
Speaker 3: then we're assuming you.

604
00:28:49,080 --> 00:28:51,600
Speaker 2: Die at eighty five. Make sure you diet eighty five.

605
00:28:51,640 --> 00:28:54,040
Speaker 3: How many years have you got We've got twenty years,

606
00:28:54,200 --> 00:28:56,440
Speaker 3: so we times it by twenty yes, and then five percent.

607
00:28:56,520 --> 00:29:00,520
Speaker 2: So we're assuming assuming every year we draw down five

608
00:29:00,600 --> 00:29:04,000
Speaker 2: percent of that the interest earned. So if there's no

609
00:29:05,640 --> 00:29:07,920
Speaker 2: just have that lump some and we don't make any money.

610
00:29:08,080 --> 00:29:08,240
Speaker 1: Ever.

611
00:29:08,360 --> 00:29:12,360
Speaker 3: Again, understand we've been quite conservative here. In twenty years,

612
00:29:12,360 --> 00:29:13,240
Speaker 3: you will have no money left.

613
00:29:13,280 --> 00:29:13,800
Speaker 2: Got you, got you?

614
00:29:13,880 --> 00:29:14,440
Speaker 1: Got you? Okay?

615
00:29:15,560 --> 00:29:18,880
Speaker 3: In a perfect world, right, in a perfect world, you'd

616
00:29:18,920 --> 00:29:20,720
Speaker 3: have that one point two million dollars and it would

617
00:29:20,760 --> 00:29:24,160
Speaker 3: be invested, Yes, and we just live off the money

618
00:29:24,200 --> 00:29:24,960
Speaker 3: that your money made.

619
00:29:25,320 --> 00:29:26,440
Speaker 2: God, that would be so good.

620
00:29:26,520 --> 00:29:29,280
Speaker 3: Then your kids or your family, or your friends or

621
00:29:29,400 --> 00:29:31,560
Speaker 3: the lost dogs home when you die.

622
00:29:31,840 --> 00:29:33,080
Speaker 2: Gets one point two million dollars.

623
00:29:33,200 --> 00:29:37,480
Speaker 3: Gorgeous, sexy copli crazy not the reality for most people,

624
00:29:37,560 --> 00:29:39,440
Speaker 3: but like, that's a pipe dream, right, and that totally

625
00:29:39,440 --> 00:29:40,640
Speaker 3: completely happened.

626
00:29:40,360 --> 00:29:41,360
Speaker 2: Oh my god, totally.

627
00:29:41,680 --> 00:29:43,080
Speaker 3: So how do we work out if we have enough

628
00:29:43,480 --> 00:29:45,320
Speaker 3: or if we will have enough to hear this target

629
00:29:45,360 --> 00:29:48,240
Speaker 3: by the time we retire? So the Money Fromart website

630
00:29:48,360 --> 00:29:50,400
Speaker 3: is one of my favorite websites ever, like the confound

631
00:29:50,440 --> 00:29:54,239
Speaker 3: interest calculators my favorite go to there, right, But there

632
00:29:54,360 --> 00:29:57,480
Speaker 3: are another two calculators that don't talk about enough on

633
00:29:57,600 --> 00:30:00,040
Speaker 3: this podcast, on that money Smart website that you you

634
00:30:00,040 --> 00:30:02,400
Speaker 3: can use to see how you're tracking. So the first

635
00:30:02,440 --> 00:30:05,680
Speaker 3: one is their superanuation calculator. What you're going to do

636
00:30:06,000 --> 00:30:09,480
Speaker 3: is honestly type in money Smart Superanuation calculator and it

637
00:30:09,480 --> 00:30:11,560
Speaker 3: will come up as the first Google search result.

638
00:30:11,600 --> 00:30:12,320
Speaker 2: You're going to click that.

639
00:30:12,440 --> 00:30:13,880
Speaker 3: Then you're going to put in how old you are,

640
00:30:14,360 --> 00:30:17,400
Speaker 3: what your salary is, what your current supernuation balance is,

641
00:30:17,520 --> 00:30:21,320
Speaker 3: like how much you're contributing, and your risk. So we

642
00:30:22,000 --> 00:30:25,120
Speaker 3: want to understand a risk, are your conservative your growth investor?

643
00:30:25,120 --> 00:30:28,760
Speaker 3: Are your high growth investor? And then it will show

644
00:30:28,840 --> 00:30:32,320
Speaker 3: you your projected balance at retirement in today's dollars.

645
00:30:32,600 --> 00:30:34,440
Speaker 2: Scary. I don't know, I'm scared of that for a reason.

646
00:30:34,560 --> 00:30:37,320
Speaker 3: But like how Good's clarity, Yeah, that's so true, because

647
00:30:37,320 --> 00:30:39,320
Speaker 3: do you know what when you're younger, Like, let's pretend

648
00:30:39,320 --> 00:30:42,440
Speaker 3: you're thirty and you're like listening to this episode, very

649
00:30:42,520 --> 00:30:45,880
Speaker 3: small tweaks today had very big incacs when it comes

650
00:30:45,920 --> 00:30:49,640
Speaker 3: to retiring. It could mean you go, oh shit, I'm

651
00:30:49,640 --> 00:30:51,560
Speaker 3: going to just talk to my employer and put in

652
00:30:51,560 --> 00:30:54,160
Speaker 3: an extra two hundred bucks a month. I'm never going

653
00:30:54,240 --> 00:30:56,360
Speaker 3: to have to think about retirement again because I'm set.

654
00:30:57,440 --> 00:30:59,960
Speaker 3: But the same thing is not true. If you're seeing

655
00:31:00,600 --> 00:31:03,120
Speaker 3: and thinking about retirement and using that calculator, you can't

656
00:31:03,160 --> 00:31:04,720
Speaker 3: just add two hundred bucks and hope it's going to

657
00:31:04,760 --> 00:31:06,920
Speaker 3: be good. Yeah, we have so much power when we

658
00:31:07,000 --> 00:31:09,600
Speaker 3: are young, Beck, because we have time on our side,

659
00:31:09,640 --> 00:31:12,960
Speaker 3: and from little things, big things grow. Now, the second

660
00:31:13,080 --> 00:31:17,320
Speaker 3: money Smart calculator is their retirement plan a calculator. Stick

661
00:31:17,360 --> 00:31:21,920
Speaker 3: in to Google Money Smart Retirement Plan a Calculator. I

662
00:31:22,200 --> 00:31:24,440
Speaker 3: love this one because it's a little bit more comprehensive,

663
00:31:25,000 --> 00:31:28,560
Speaker 3: takes a little bit longer, but I promise you're going

664
00:31:28,600 --> 00:31:31,320
Speaker 3: to want to do it. It's going to ask you

665
00:31:31,440 --> 00:31:34,280
Speaker 3: some similar questions to the first one. But you can

666
00:31:34,440 --> 00:31:37,560
Speaker 3: also include your partner if you have one plus in

667
00:31:37,640 --> 00:31:39,400
Speaker 3: the advanced settings. And we do want to play with

668
00:31:39,440 --> 00:31:42,120
Speaker 3: the advanced settings, because like, we're not here to mess around,

669
00:31:42,120 --> 00:31:45,160
Speaker 3: we're here to create a retirement plan, Beck, you can

670
00:31:45,200 --> 00:31:47,520
Speaker 3: play around with things like your age that you want

671
00:31:47,600 --> 00:31:49,680
Speaker 3: to you know, last too, so maybe you're like, oh

672
00:31:49,720 --> 00:31:53,560
Speaker 3: my god, like Victoria told me that most of this,

673
00:31:53,960 --> 00:31:56,960
Speaker 3: like ASFA data assumes that I retire at sixty five

674
00:31:57,000 --> 00:31:59,560
Speaker 3: and die at eighty five. Go, You're going to look

675
00:31:59,560 --> 00:32:02,680
Speaker 3: at your nan who's one hundred and one, Like maybe

676
00:32:02,840 --> 00:32:05,160
Speaker 3: you have a higher life expectancy in your family and

677
00:32:05,240 --> 00:32:07,360
Speaker 3: this can be a morbid conversation, but I'm sorry, you're

678
00:32:07,400 --> 00:32:08,880
Speaker 3: gonna need a plan for a few.

679
00:32:08,760 --> 00:32:10,040
Speaker 2: More years than eighty five.

680
00:32:10,160 --> 00:32:13,200
Speaker 3: Yeah, but you can fiddle with that number like the

681
00:32:13,320 --> 00:32:14,880
Speaker 3: age you want it to last you, and it will

682
00:32:14,960 --> 00:32:17,640
Speaker 3: show you what your yearly income would be from your

683
00:32:17,680 --> 00:32:20,760
Speaker 3: superranuation combined with your partner if you have one, And

684
00:32:20,880 --> 00:32:23,240
Speaker 3: you can also select if you want it to include

685
00:32:23,240 --> 00:32:25,200
Speaker 3: the age pension or not, which I think is really

686
00:32:25,280 --> 00:32:28,840
Speaker 3: empowering true because remember before you and I just said

687
00:32:28,880 --> 00:32:32,080
Speaker 3: you wanted a sixty thousand dollar income in retirement. Yeah,

688
00:32:32,480 --> 00:32:35,600
Speaker 3: that's where the seventy percent rule starts to fall down,

689
00:32:36,280 --> 00:32:38,400
Speaker 3: because we didn't talk about the age pension at all.

690
00:32:38,480 --> 00:32:40,600
Speaker 3: We just said you needed one point two million dollars

691
00:32:40,640 --> 00:32:42,440
Speaker 3: in superranuation to achieve that lifestyle.

692
00:32:42,520 --> 00:32:44,040
Speaker 2: Back, does everyone get the age pension?

693
00:32:44,200 --> 00:32:44,240
Speaker 1: No?

694
00:32:44,720 --> 00:32:48,400
Speaker 3: No, it's asset based, Okay, So you can get the

695
00:32:48,480 --> 00:32:50,680
Speaker 3: age pension if you own your own home because your

696
00:32:50,800 --> 00:32:55,160
Speaker 3: family home is not considered or taken into consideration when

697
00:32:55,520 --> 00:32:59,280
Speaker 3: accessing the age pension. But they do consider youre and

698
00:32:59,360 --> 00:33:02,360
Speaker 3: there's like I believe it's around four hundred thousand dollars

699
00:33:02,440 --> 00:33:05,440
Speaker 3: before it starts to come into play, but other assets,

700
00:33:05,560 --> 00:33:08,480
Speaker 3: so they'll look at your superannuation, they'll look at it,

701
00:33:08,680 --> 00:33:11,160
Speaker 3: your investment properties, they'll look at your cars, your boats,

702
00:33:11,240 --> 00:33:14,240
Speaker 3: you're literally everything that you own. And if you own

703
00:33:14,720 --> 00:33:18,080
Speaker 3: over a certain amount of assets, then it starts to

704
00:33:18,200 --> 00:33:20,200
Speaker 3: impact how much of the age pension you get.

705
00:33:20,240 --> 00:33:22,000
Speaker 2: It's not a cutoff and they say you have more

706
00:33:22,040 --> 00:33:22,840
Speaker 2: than that, you get none.

707
00:33:23,240 --> 00:33:26,080
Speaker 3: It starts to cut down how much age pension you

708
00:33:26,200 --> 00:33:28,800
Speaker 3: get until basically it says, okay, well you don't qualify

709
00:33:28,880 --> 00:33:32,360
Speaker 3: for any of it, okay, and this calculator will tell

710
00:33:32,440 --> 00:33:36,640
Speaker 3: you based on the assets you're planning on owning at retirement,

711
00:33:36,800 --> 00:33:39,600
Speaker 3: not including your family home, which is a little bit sneaky, right,

712
00:33:40,040 --> 00:33:43,520
Speaker 3: because if your family home is worth five million dollars, yeah,

713
00:33:44,280 --> 00:33:46,120
Speaker 3: that's fine because.

714
00:33:45,880 --> 00:33:48,840
Speaker 2: Your family home's not not taken into consideration.

715
00:33:48,960 --> 00:33:51,480
Speaker 3: True, there's parts that I really like, I agree with

716
00:33:51,600 --> 00:33:53,520
Speaker 3: because it like, okay, well we all need to rip

717
00:33:53,520 --> 00:33:55,479
Speaker 3: of our heads. But yeah, I suppose you could move

718
00:33:55,520 --> 00:33:59,400
Speaker 3: into your most expensive one yep. Are Okay, Yeah, there's

719
00:33:59,520 --> 00:34:02,000
Speaker 3: just there's a few things that make sense and don't

720
00:34:02,040 --> 00:34:05,880
Speaker 3: make sense. But ideally the plan with the age pension

721
00:34:06,000 --> 00:34:08,000
Speaker 3: is that it works out for the average Australian.

722
00:34:08,520 --> 00:34:10,000
Speaker 2: So yeah, you can stick that in and.

723
00:34:10,080 --> 00:34:12,759
Speaker 3: It will show your annual income that is necessary in

724
00:34:12,840 --> 00:34:15,359
Speaker 3: today's dollars, and I think that that's really powerful. It's

725
00:34:15,400 --> 00:34:18,520
Speaker 3: also a really great tool if you're helping your parents,

726
00:34:18,680 --> 00:34:21,239
Speaker 3: if they are, you know, going through overtirement at the moment,

727
00:34:21,360 --> 00:34:23,600
Speaker 3: or trying to calculate it out, or they've got some

728
00:34:23,800 --> 00:34:26,360
Speaker 3: questions or queries, it's a great resource to go to.

729
00:34:26,800 --> 00:34:29,600
Speaker 2: Okay, And so we're going to either see if we're

730
00:34:30,000 --> 00:34:32,920
Speaker 2: on track or on target or not.

731
00:34:33,360 --> 00:34:37,040
Speaker 3: And that's where we want to compare our projection to

732
00:34:37,520 --> 00:34:39,880
Speaker 3: the target, like are we on track? Do like we

733
00:34:40,000 --> 00:34:41,960
Speaker 3: need to do a schedule or review. Is there a

734
00:34:42,040 --> 00:34:44,520
Speaker 3: little bit of a gap? What does that look like?

735
00:34:44,680 --> 00:34:46,719
Speaker 3: If so, how are we going to make that up?

736
00:34:46,760 --> 00:34:48,919
Speaker 3: Have we taken some If you're a female, very likely

737
00:34:48,960 --> 00:34:51,640
Speaker 3: you've taken some time out of the workforce. Do we

738
00:34:51,719 --> 00:34:55,600
Speaker 3: need to top up our superannuation? Like do you maybe

739
00:34:55,680 --> 00:34:57,520
Speaker 3: want to save for a house and you haven't really

740
00:34:57,520 --> 00:34:59,960
Speaker 3: thought about that before. But you're like, oh, maybe I do. Actually,

741
00:35:00,000 --> 00:35:02,880
Speaker 3: we want to own a home by the time I retire.

742
00:35:03,040 --> 00:35:06,040
Speaker 3: It's like kickstart these conversations. Doesn't mean you need to

743
00:35:06,640 --> 00:35:09,239
Speaker 3: Renting for life is a very valid strategy, but it's

744
00:35:09,280 --> 00:35:12,600
Speaker 3: a strategy that needs a plan still. Yeah, so it's

745
00:35:12,680 --> 00:35:14,880
Speaker 3: not a oh I didn't think about it and I

746
00:35:15,040 --> 00:35:17,560
Speaker 3: ended up renting for life. We still need a plan.

747
00:35:17,960 --> 00:35:21,120
Speaker 3: We are making a financial plan irrespective of what our

748
00:35:21,239 --> 00:35:23,600
Speaker 3: goals are, whether you want to own a home or not.

749
00:35:24,360 --> 00:35:28,360
Speaker 3: And I think knowing this now to me is so

750
00:35:29,160 --> 00:35:32,680
Speaker 3: empowering because time is on your side. Most people in

751
00:35:32,760 --> 00:35:35,520
Speaker 3: our community sit between the age of twenty five and

752
00:35:35,719 --> 00:35:39,960
Speaker 3: thirty four. Go go look at your superinuation and make

753
00:35:40,040 --> 00:35:42,920
Speaker 3: small tweaks now so that we're not having big problems

754
00:35:43,000 --> 00:35:43,640
Speaker 3: down the track.

755
00:35:43,800 --> 00:35:45,320
Speaker 2: Yep, yepkay.

756
00:35:45,360 --> 00:35:47,520
Speaker 3: There are heaps of options as well. There are lots

757
00:35:47,520 --> 00:35:50,480
Speaker 3: of quick wins. You can log into your supranuation accounts.

758
00:35:50,480 --> 00:35:52,600
Speaker 3: You can go to your MiG of account and consolidate

759
00:35:52,680 --> 00:35:55,560
Speaker 3: your multiple subrounuation accounts. If you've got them, you're going

760
00:35:55,600 --> 00:35:57,759
Speaker 3: to save heaps of money on fees you could look

761
00:35:57,800 --> 00:35:59,600
Speaker 3: at the fees of your fund and do a little

762
00:35:59,640 --> 00:36:03,080
Speaker 3: bit of comparison. You can look at the performance of

763
00:36:03,120 --> 00:36:05,360
Speaker 3: your fund and pick one that's aligned to your values.

764
00:36:05,640 --> 00:36:07,239
Speaker 2: I would make sure that you're doing a.

765
00:36:07,640 --> 00:36:10,560
Speaker 3: Risk profile and actually understanding well, am I actually a

766
00:36:10,640 --> 00:36:11,799
Speaker 3: balanced super fund member?

767
00:36:11,920 --> 00:36:13,600
Speaker 2: Or am I a bit of a high growth baddie?

768
00:36:14,040 --> 00:36:15,360
Speaker 2: Like what does that look like?

769
00:36:16,000 --> 00:36:20,359
Speaker 3: And then you know, maybe let's say you're behind, well,

770
00:36:20,440 --> 00:36:22,120
Speaker 3: you could boost your salary sacrifice.

771
00:36:22,160 --> 00:36:25,480
Speaker 2: Girl, that's pre tax like money win.

772
00:36:25,920 --> 00:36:28,480
Speaker 3: You can play around with the calculators I mentioned earlier

773
00:36:28,560 --> 00:36:32,200
Speaker 3: to see what impacts additional contributions might be able to have.

774
00:36:33,160 --> 00:36:36,359
Speaker 3: You could make a plan to invest outside of superannuations.

775
00:36:36,400 --> 00:36:39,440
Speaker 3: So you've got another nest egg, We've got double You

776
00:36:39,520 --> 00:36:42,439
Speaker 3: could look at additional income streams that you could add

777
00:36:42,560 --> 00:36:45,919
Speaker 3: in retirement, like totally, what else are we going to plan?

778
00:36:46,040 --> 00:36:47,960
Speaker 2: There's just so many things we could plan. And when

779
00:36:48,160 --> 00:36:50,000
Speaker 2: you have time on your side, we've got so much,

780
00:36:50,200 --> 00:36:50,640
Speaker 2: so much.

781
00:36:50,719 --> 00:36:53,799
Speaker 3: And I just based on when I worked at superannuation

782
00:36:54,160 --> 00:36:57,080
Speaker 3: company two different ones. They always have their own like

783
00:36:57,200 --> 00:36:59,680
Speaker 3: financial advice, like general financial advice for free.

784
00:37:00,080 --> 00:37:01,759
Speaker 2: You can just call up and say, hey, I want to.

785
00:37:01,760 --> 00:37:04,040
Speaker 3: Talk to someone about if you don't understand risk profiles

786
00:37:04,040 --> 00:37:07,640
Speaker 3: and all that kind of one hundred superannuation company, if

787
00:37:07,680 --> 00:37:10,919
Speaker 3: you just call them and have a chat, they will absolutely.

788
00:37:10,360 --> 00:37:11,799
Speaker 2: Help you and talk you through it. So and they

789
00:37:11,880 --> 00:37:14,239
Speaker 2: love that. Please call them already you love it. You're

790
00:37:14,280 --> 00:37:16,040
Speaker 2: literally paying them with your super fees.

791
00:37:16,160 --> 00:37:17,680
Speaker 3: Yes, And if you call up and I just I

792
00:37:17,760 --> 00:37:19,719
Speaker 3: remember this from one particular place, I'm sure it's in

793
00:37:19,800 --> 00:37:22,040
Speaker 3: a lot of different superannuation companies. If you say I

794
00:37:22,080 --> 00:37:24,120
Speaker 3: would like general advice, and they put you through the

795
00:37:24,200 --> 00:37:26,560
Speaker 3: general advice team, the person who answered your.

796
00:37:26,480 --> 00:37:28,520
Speaker 2: Call gets some sort of voters. I remember we got

797
00:37:28,520 --> 00:37:31,000
Speaker 2: like a gig guys. Yeah, they do so super fun.

798
00:37:31,280 --> 00:37:33,359
Speaker 2: You've everyone a bonus, you've ever had a bonus? Get

799
00:37:33,360 --> 00:37:37,279
Speaker 2: free advice? God win win. Okay, so this episode was

800
00:37:37,840 --> 00:37:38,719
Speaker 2: very numbers heavy.

801
00:37:38,800 --> 00:37:40,920
Speaker 3: It was quite numbers heavy, and I am sorry. And

802
00:37:41,160 --> 00:37:43,640
Speaker 3: we'll probably do an Instagram post at the same time

803
00:37:43,680 --> 00:37:46,000
Speaker 3: as this goes out, So go check our feed because

804
00:37:46,040 --> 00:37:48,160
Speaker 3: all of those numbers and stats and stuff will probably

805
00:37:48,160 --> 00:37:50,680
Speaker 3: be on a carousel post for you if you want

806
00:37:50,719 --> 00:37:53,720
Speaker 3: more information. They will all be on the ASFA website,

807
00:37:53,760 --> 00:37:55,719
Speaker 3: which we will link in the show notes. And I

808
00:37:55,760 --> 00:37:58,120
Speaker 3: will also make sure that all the calculators that we

809
00:37:58,320 --> 00:38:00,960
Speaker 3: have mentioned are also linked in the show notes for you.

810
00:38:01,040 --> 00:38:02,399
Speaker 2: God, she's good. God she's good.

811
00:38:02,440 --> 00:38:06,759
Speaker 3: I feel empowered. Dare I say, oh, hey, yeah, so

812
00:38:07,640 --> 00:38:09,000
Speaker 3: I think this is a great place to leave it.

813
00:38:09,160 --> 00:38:11,239
Speaker 3: I do as well, and I'm glad that you feel

814
00:38:11,239 --> 00:38:12,880
Speaker 3: empowered as you should you.

815
00:38:13,040 --> 00:38:13,279
Speaker 2: Queen.

816
00:38:13,800 --> 00:38:16,960
Speaker 3: Look, super might not be the most exciting thing in

817
00:38:17,040 --> 00:38:19,919
Speaker 3: the entire world, or even something that's on your radar,

818
00:38:20,000 --> 00:38:22,279
Speaker 3: but like, congrats, queen, if you got through this entire

819
00:38:22,320 --> 00:38:24,239
Speaker 3: episode and you're listening to me saying this, like you

820
00:38:24,360 --> 00:38:27,080
Speaker 3: have done something for future you already. But it is

821
00:38:28,320 --> 00:38:31,759
Speaker 3: the quiet achiever. It is going to fund your bottomless

822
00:38:31,800 --> 00:38:34,719
Speaker 3: brunches when you're seventy. If you want to be that

823
00:38:34,920 --> 00:38:37,480
Speaker 3: seventy year old who you go wonder what she did

824
00:38:37,560 --> 00:38:39,160
Speaker 3: in the past life to be able to drink him

825
00:38:39,160 --> 00:38:41,919
Speaker 3: in Mosa at ten am, that's who I plan on being.

826
00:38:42,040 --> 00:38:44,160
Speaker 2: Oh yeah, I want people to question what I did

827
00:38:44,239 --> 00:38:45,480
Speaker 2: with my life to end up.

828
00:38:45,480 --> 00:38:48,759
Speaker 3: In the brunch location at ten am, drinking him in

829
00:38:48,840 --> 00:38:51,279
Speaker 3: Mosa And I guess that's the kind of long game

830
00:38:51,320 --> 00:38:53,560
Speaker 3: that we're all here for. And if you haven't already,

831
00:38:53,760 --> 00:38:57,680
Speaker 3: please hit follow tap subscribe, do all the things, because

832
00:38:58,040 --> 00:38:59,799
Speaker 3: we've got plenty more episodes coming.

833
00:39:00,160 --> 00:39:02,720
Speaker 2: Are genuinely going to put future you in the best

834
00:39:02,880 --> 00:39:05,880
Speaker 2: possible financial position. We'll see you guys on Friday.

835
00:39:06,239 --> 00:39:13,600
Speaker 1: Bye did buy.

836
00:39:13,600 --> 00:39:16,120
Speaker 3: Shared on She's on the Money is general in nature

837
00:39:16,200 --> 00:39:17,680
Speaker 3: and does not consider.

838
00:39:17,320 --> 00:39:18,800
Speaker 2: Your individual circumstances.

839
00:39:19,200 --> 00:39:22,600
Speaker 3: She's on the Money exists fully for educational purposes and

840
00:39:22,640 --> 00:39:25,040
Speaker 3: should not be relied upon to make an investment or

841
00:39:25,160 --> 00:39:28,720
Speaker 3: financial decision. If you do choose to buy a financial product,

842
00:39:28,840 --> 00:39:32,760
Speaker 3: read the PDS TMD and obtain appropriate financial advice tailored

843
00:39:32,840 --> 00:39:36,279
Speaker 3: towards your needs. Victoria Divine and She's on the Money

844
00:39:36,360 --> 00:39:40,120
Speaker 3: are authorized representatives of Money Shopper Pty Ltd.

845
00:39:40,400 --> 00:39:42,799
Speaker 2: A b N three two one IS six four nine

846
00:39:42,960 --> 00:39:43,120
Speaker 2: two

847
00:39:43,239 --> 00:39:47,080
Speaker 3: Seven seven zero eight AFSL four five one two eight

848
00:39:47,160 --> 00:39:47,440
Speaker 3: gerln