Do you know what your number is?
I was presenting a strategic plan to some new clients last week and they couldn’t believe how much they needed to have in assets to reach their retirement number.
This got me thinking, most people don’t realize how much of an asset base must be saved for retirement.
A quick google and you get the government’s smart money website. They indicate that $640,000 is enough to provide a couple a ‘comfortable’ lifestyle of $62,083pa.
‘ASFA estimates that the lump sum needed at retirement to support a comfortable lifestyle is $640,000 for a couple and $545,000 for a single person. This assumes a partial Age Pension.’
Therefore, if you are spending $120,000pa you just need to double that figure.
The reality is you will need well over $2.5 million (assuming funding for 30 years with 6% returns). This is a lot more than what the government tells us you need and this is a big difference. You will also need more if you also want to upgrade your car, help out the kids, or go on big overseas holidays.
With this in mind, will you have enough if you are currently spending $150,000 or $200,000 on your lifestyle?
If you want to comfortably accumulate a multi-million dollar nest egg to maintain your current standard of living after retirement it’s a lot easier to start planning sooner rather than later.
