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:

• superannuation you're likely to have when you retire
• Age Pension you'll be entitled to

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 superannuation

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 superannuation fund for you.

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

Understand how it works

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

Consolidate your superannuation

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

Consolidating your superannuation 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 superannuation

There are ways to boost your superannuation before you retire:

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

If you are topping up your superannuation, 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 different income support payments, concessions and rebates available when you retire to help lower your living expenses. Your eligibility will depend on your situation.

Income support payments

The Age Pension is the main income support payment for people who have reached pension age. 

To get the Age Pension, you’ll need to:

• be the qualifying age or older, and 
• meet residency rules

The qualifying age is currently 66 years old. This will increase by 6 months every 2 years until the pension age is 67 on 1 July 2023.

The amount you receive will depend on your income, assets, and if you’re single or part of a couple.

You will automatically get Rent Assistance if you get certain income support payments, including the Age Pension, Carer Payment or Disability Support Pension and pay either:

• rent
• retirement village fees
• lodging
• board and lodging, or
• site or mooring fees, if your main home is a caravan, relocatable home or a boat

Concessions

You will automatically get a Pensioner Concession Card from either Services Australia or the Department of Veterans' Affairs if you’re over 60 and get certain income support payments, including the:

• Age Pension
• Service Pension
• Income Support Supplement
• Carer Payment, or 
• Disability Support Pension

It entitles you to discounted medical care and medicine.

The Commonwealth Seniors Health Card is available if you’re the Age Pension age and unable to get an income support payment. You’ll need to meet an income test and residency rules. The concession card gives you discounts on medical care and medicine.

You can get either a NSW Seniors Card or Senior Savers Card if you’re 60 years or older. Which one you get will depend on if you’re working more than 20 hours a week of paid work across a 12-month period. Both cards entitle you to discounts and special offers at businesses across NSW.

You can get discounted travel on public transport if you have either a NSW Seniors Card or a Pensioner Concession Card. 

If you're a pensioner, you may be eligible for concessions on your vehicle registration in NSW.

Rebates

There are several rebates available to help with the cost of energy bills, including:

• Energy Supplement
• Energy Rebate
• Gas Rebate
• Water Rebate

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 superannuation 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 superannuation fund
• have reached your superannuation 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