March 3, 2014
Sixty-five might seem a long way off or appear too close to do anything about, but on both counts, that’s just not the case.
One area in which Money Myths are particularly rife is in saving for retirement. When we ran a survey of 1000 Australian women, we uncovered some interesting insights:
75% are not saving in addition to the super
50% say they don’t have any spare money for retirement
34% say saving for retirement is not a priority
29% say saving for retirement is a low priority
And for our under 25s, we also found:
35% say they don’t have any spare money
30% say they are too young to worry about saving for retirement at the moment
40% say they have plenty of time to save for retirement
19% say they want to use their money now
It’s the old argument between immediate ‘needs’ and planning for a rainy day. While the compulsory super scheme is ticking along in the background, it can be easy to ignore thinking about how much you’ll want for your lifestyle when it comes to leaving the workforce.
What we need for retirement is a personal decision, but one that we need to put a number on and regularly review against aspirations and plans.
Even though for some, 65 may seem a long way off and something that can be planned for down the track, the simple fact is that the longer we leave it, the more we have to save over a shorter period of time to live comfortably when we retire.
For example, (without including interest earnings) if you start putting aside an extra $20 a week at 25, you’ll have an extra $41,600 at 65. To reach the same sum when starting at 45, you’d need to put away $40 a week.
But having said that, it’s never too late to shape the retirement you want. The key is to sit down, understand your financial assets and position, consider the lifestyle you want and actively draw up an investment and saving plan to get there.