Planning your retirement

When planning to retire, it helps to know what your current money situation is. To do this, you will need to know your net worth.

Your net worth is all of your assets (what you own) less any debts you have.

You can also work out how much super and age pension you are likely to have when you retire.

How much money you need to retire will depend on: 

• your current age
• whether you own your own home
• your other assets
• what your living expenses are 
• how much you have in super

Before you start to think about retirement, you should know how much money you have coming in and what you are spending your money on.

Creating a budget will help you manage your money and keep you focused on your money goals.

Any changes you can make now to lower any debt and increase your savings will all help when you're ready to retire.

If you don’t think you'll have enough money to retire, consider getting financial advice for your specific circumstances: 

• Financial Information Service can help with budgeting or planning for retirement at Services Australia
• Find a free financial counsellor at Financial Counselling Australia

When planning your retirement, it can be helpful to think about how ageing may affect your health in the future.

You may want to factor the cost of health care into your budget.

Private health insurance

If you have private health insurance, you will usually:

• have shorter waiting periods
• get your choice of doctor

When deciding if private health insurance is right for you, think about: 

• the cost of private health insurance
• the cost of possible future treatments
• your overall health 
• the level of care that you want

Superannuation is a tax effective way to save for your retirement. Your employer will make contributions to your super fund for you.

You can also choose to top up your super with your own money.

Understand your super

Taking some time now to learn how super works can help you get the most out of your super.

Consolidate your super

If you have changed jobs, you may have more than one super account. Moving all your super into one account is known as consolidating. 

Consolidating your super will:

• make it easier to keep track of your super
• save you money as you will only pay one set of fees
• reduce paperwork

Grow your super

There are ways to boost your super before you retire:

• compare superannuation fund fees
• think about your super investment options
• top up your super with your own money

If you are topping up your super, remember:

• you will pay less tax if you salary sacrifice from your pay
• low income earners may get a tax-offset or government co-contribution payment

There are concessions, rebates and income support available when you retire to help lower your cost of living, including:

• age pension
• pensioner concession card
• seniors card
• rent assistance
• energy supplement, energy rebate, gas rebate and water rebate
• transport concessions
• pensioner concessions on vehicle registrations

You may be able to make a gradual transition to retirement by going part time with your job.

Going part time can involve working less, or you can talk to your employer about changing your role or team to better suit flexible work. 

Going part time generally involves:

• talking to your employer about options
• talking to your family
• making a financial plan

You may want to boost your pay before retiring by taking on extra hours at your current work. You could also look for additional work outside of your regular job.

Before taking on extra hours or a second job, consider:

• talking to your work about the options for overtime within your company
• checking your company’s policies
• checking how much tax you will need to pay on any extra income
• if your work offers a superannuation matching program
• if your can ask for a pay rise or increase your salary in other ways

If you're reducing your work hours but don't want to reduce income, you might be able to access your super while you're working.  

A Transition to Retirement pension can be used to top up your employment income if you decide to reduce your work hours. 

To access a Transition to Retirement pension you need to: 

• be with an accumulation super fund
• have reached your super or pension preservation age

Many people choose to stay in their long-term home in retirement.

There is some support available for people who want to make their homes easier to live in as they age. 

Staying in your home over the long term can involve: 

• installing grab rails or ramps
• getting help with your garden
• getting help with cleaning

Some changes to your home and some in-home care options are partially covered by My Aged Care.

When retiring, people often sell their home to reflect changes to their life. 

When buying a new home, think about how your needs might change over time, including whether the new home: 

• can be cleaned easily
• has a garden that can be kept easily 
• has room for stairs and supports
• has room for guests
• is easily accessed from the street or driveway

You might also want to consider how close you are to: 

• family and friends
• medical services
• outdoor spaces
• hobbies, social and cultural activities

Retirement villages offer homes that are easily maintained in a private and secure environment with people of a similar age. 

There are different types of occupancy and ownership arrangements in retirement villages. You should think about:

• the type of tenure
• the cost
• understanding and comparing the contracts that different villages offer

There are different options for care in retirement villages, including:

• self-contained, for people who are able to live independently 
• serviced (or assisted living), which can include meals, cleaning and other services
• a mix of self-contained and serviced, allowing people to change if their needs change

Some retirement villages also include optional support services, including: 

• social groups 
• health and fitness classes 
• specialised medical equipment 
• specialised medical staff

Social housing

Social housing is housing for people on low incomes and includes:

• rooms in share homes 
• apartments 
• stand alone units or house 
• community housing

People living in social housing can live with their partners or families, or alone.

Affordable housing

Affordable housing is different to social housing. It is managed more like a private rental property and is for very low to moderate income earners.

Applicants need to meet eligibility criteria based on income thresholds, depending on where they live. Properties are mostly managed by not for profit community housing providers.

You do not have to be eligible for social housing to apply for affordable housing, though people who are eligible for social housing may also be eligible for affordable housing properties.

Renting through an agent or self-managing landlord

If you plan to rent when you retire, there are payments and resources that can help.

You can get help with your rent at:

• Services Australia
• NSW Department of Family and Community Services

Learn more about renting:

• starting a tenancy at NSW Fair Trading
• get a step-by-step guide to renting at NSW Department of Family and Community Services

These services can help you better understand your financial situation and empower you to make informed decisions about your financial future:

• Financial Information Service can help with budgeting or planning for retirement at Services Australia
• find a free financial counsellor at Financial Counselling Australia

It is important that you know your rights and where to get legal advice and support if you need it:

• information on your rights at retirement at the Australian Human Rights Commission
• information, advice and assistance to promote and protect your legal rights at Legal Aid NSW
• advocacy, legal support and advice at Seniors Rights Service
• advice and advocacy if you're in financial stress at Financial Rights Legal Centre
• legal advice for women with a focus on family law, parenting issues, domestic violence, sexual assault and discrimination at Women's Legal Service NSW

Talking to your family when you first start planning for your retirement will help make sure there are no surprises when you do retire.

Whether you want input from family members or simply want to advise them of your plan, topics to talk about include:

• expectations for travel, activities and other plans
• the impact on family members that need emotional, physical and financial support
• where you intend to live
• financial and inheritance plans

Retiring from a regular job doesn’t always mean you stop working completely. 

Volunteering is an opportunity to:

• contribute to your community
• meet people
• learn new skills
• share your expertise

This can be part time, casual, or even full time.

You are likely to have more time when you retire to learn a new skill, explore a hobby or join a social group that shares your interests.

Learning

There are many places that offer courses and opportunities to learn.

Whether you prefer individual or group-based learning, you can find courses offered online or in classrooms and workshops. This can include:

• sharing knowledge through courses and lectures on different topics right across NSW with the University of the Third Age.
• your local library, which may offer free courses, activities and events

Social groups and activities

Joining a social group or activity is an easy way to meet new people who share your interests:

• your local council may run activities. Find your local council to see what's on
• people living in regional NSW can search the NSW Seniors Activities Guide by activity and location to find social clubs, sporting activities and more