Retirement planning advice: when can you actually stop?
Plenty of retirement planning advice looks great on a spreadsheet and falls apart the first time the market drops. We build yours around the things that actually wreck plans: a bad run of returns right at the start, living longer than you budgeted for, and how it all lines up with the Age Pension.
Three stages, one plan.
A retirement plan isn't one document you write at 65. It's three stages that have to line up: how the money goes in, how you wind down the work, and how you take the income out. When a different adviser handles each stage, tax leaks out of the joins. There's a longer version of this in our retirement planning guide.
Here, one person writes the whole thing. One set of files covering super, the house, any rental property, your insurance and your will. What we decided about putting money into super is still on the file fifteen years later when we work out what you draw out.
The six parts of a retirement plan.
We work through each one in writing, then join them up. None of these is a product being sold to you. Each is a decision you have to make, and then make again as things change.
Accumulation
Your working years — getting money into super in the right order, while still paying the mortgage and living your life. The yearly limits can't be made up later.
Easing out of work
From 60 you can start drawing on super while still working — a 'transition to retirement' pension. We run the tax numbers before suggesting it, because it doesn't always pay.
Drawing a pension
Once you're allowed to access it, super turns into a tax-free income stream — up to a cap. How much you draw, what it's invested in and when we check it all get written down.
A bad start to retirement
A poor few years right after you stop working hurts far more than the same years later on. We keep a cash buffer so you're not forced to sell in a downturn.
Living longer than planned
Plans built around a guessed end date tend to run out. We test yours to age 95 and past it, with the cost of aged care included.
What to spend first
Where the next $10,000 comes from — your super pension, your shares, or cash in the bank. The order changes what you pay in tax and what Centrelink gives you.
What you spend first matters more than what you invest in.
Once you've stopped working, deciding which pot pays the next bill is often worth more than anything else you do that year. Money from a super pension is tax-free after 60. Money still sitting in accumulation isn't. Selling shares can trigger capital gains tax, though franking credits help. Cash is easy to get at but earns you almost nothing.
The right order shifts with the market, with your Age Pension and with any big one-off costs. We set a default order in the written advice and look at it again each year. If owning property directly suits you, the same person writes the super fund strategy and the loan as well.
- How much you draw each year
- Taking a lump sum
- Putting money back in
- Franking credit refunds
- When to sell, for tax
- Age Pension cut-offs
Questions we get a lot.
Ten to fifteen years before you want to stop is about right. The yearly limits on what you can put into super don't roll over — miss a year and it's gone. Most of the real work in a retirement plan happens between 45 and 60.
There's a limit on how much of your super can be moved into a tax-free retirement pension. It's called the transfer balance cap, it goes up over time, and for most people it's the thing that shapes the whole strategy. We confirm the current figure and your own cap in the written advice rather than quoting a number here that goes stale.
Sometimes. The tax break was cut back in 2017, so it's no longer an automatic win. It can still stack up if you're dropping to part-time, salary sacrificing hard, or just need to bridge a couple of years to 60. If the maths doesn't work for you, we'll say so.
Yes, and both the advice and any borrowing come from the same person here. The SMSF page goes through how it all works.
Keep reading
- Financial planning overviewThe main page — what a plan covers and how it is written.
- Superannuation adviceWhich fund, whether to combine them, and what to put in.
- Centrelink optimisationGetting the Age Pension you are actually entitled to.
- Aged care planningWhat aged care costs, and the conversation to have first.
- SMSF advice and lendingRunning your own fund, and borrowing inside it.
- Retirement planning hubThe big picture — super, property, insurance and aged care.
Information on this page is general in nature. It does not take into account your personal objectives, financial situation, or needs. Read the relevant Product Disclosure Statement and consider whether personal advice is appropriate before acting on any information here.
Time to write it down?
The first conversation is free and you're not committing to anything. Bring your last super statement and a rough idea of what you spend.