IFA Awards for Excellence – August 2014

Short-Term vs Long-Term Investments

Understanding Short Term vs Long Term Investments

At Life Financial Planners, we understand that your financial journey is unique, just like your investment needs. If you’re in Perth and looking to build wealth before retirement and feel more secure in your financial future, having a solid investment strategy is essential. Let’s explore the differences between short-term and long-term investing to help you make informed decisions that align with your financial goals.


Understanding Short-Term vs. Long-Term Investing 

The primary difference between short-term and long-term investing lies in how you approach an investment, not the investment itself. For instance, a stock can be used for both short-term and long-term investments depending on whether you buy and sell it within a month or hold onto it for several years. Understanding these differences allows you to craft an investment strategy that aligns with your long-term wealth goals.


Main Differences Between Short-Term and Long-Term Investments


Aspect Short-Term Investing Long-Term Investing 
Duration Less than a year At least a year, often several years or more 
Strategy Active trading, frequent transactions Buy-and-hold, passive investing 
Risk Higher short-term risk, frequent market monitoring Lower long-term risk, focus on market growth 
Taxation Higher tax rates on short-term gains Lower tax rates on long-term gains 
Liquidity High, quick access to funds Lower, less accessible 

Crafting Your Investment Strategy in Perth

When deciding between short-term and long-term investments, consider your financial goals, time horizon, and risk tolerance. Both approaches contribute to a well-rounded portfolio. 

Investment Goals and Time Horizon: 

Near-Term Goals: If you need funds in the near future, short-term investments are ideal. For instance, saving for a home loan deposit or a significant purchase in the next few years. 

Long-Term Goals: For goals like retirement, long-term investments are more suitable, allowing you to benefit from market growth and compounding returns over decades. 

Risk Tolerance: 

Short-Term Risk: If you’re a risk-averse investor you may prefer stable, low-risk options, including high-yield savings accounts, CDs, short-term bonds, and money market accounts. These are less risky and are suitable for growing savings for near-term needs. 

Long-Term Risk: Those with a longer time horizon can assume more risk, as they have time to recover from market downturns, making investments like index funds and stocks ideal. 

Building a Balanced Portfolio

At Life Financial Planners, we advocate for a diversified portfolio that combines both short-term and long-term investments. This balanced approach ensures that you can meet both your immediate financial needs and long-term wealth-building goals, whilst diversifying risk and optimising your returns.

An Investment Strategy Tailored to You

Investing might feel overwhelming, but it doesn’t have to be. We’re dedicated to assisting you in creating a tailored investment strategy through expert financial planning. Reach out to Marijana or Mei at (08) 9322 1882 to speak to a planner and embark on the path to achieving your financial goals. Don’t delay investing in your future with LIFE Financial Planners right here in Perth.

Grow your superannuation

How to Grow Your Superannuation

Superannuation, or simply “super,” isn’t just a savings plan—it’s your key to secure and fulfilling retirement plans. At LIFE Financial Planners in Perth, we recognise the significance of making informed decisions about your super, and we’re here to guide you every step of the way.


Super Contributions

Super contributions play a significant role in building your retirement savings. There are various types of contributions you can make to your super fund, including employer contributions, voluntary contributions, government co-contributions, spouse contributions, and downsizer contributions: 

  • 1. Employer Contributions: Your employer is required to contribute a percentage of your earnings into your super account. This compulsory contribution, known as the super guarantee, must be at least 11% (increasing to 11.5% on July 1st 2024) of your ordinary time earnings.
  • 2. Additional Voluntary Contributions: Making extra contributions to your super can significantly accelerate its growth. You can contribute additional funds through salary sacrifice arrangements or by making after-tax contributions.
  • 3. Government Co-contributions: Eligible individuals making after-tax contributions to their super may qualify for government co-contributions. The government matches a portion of your contributions, providing a valuable boost to your retirement savings.
  • 4. Spouse Contributions: If your spouse earns a low income or is not working, you may be eligible to contribute to their super account and claim a tax offset. This can be a tax-effective way to bolster their retirement savings.
  • 5. Downsizer Contributions: If you’re aged 65 or older and have owned your home for more than ten years, you may be able to contribute up to $300,000 from the sale of your home into your super. This one-time contribution can enhance your retirement nest egg.


Investment Strategies

Investment strategies involve determining how you allocate your superannuation funds across different asset classes, such as stocks, bonds, property, and cash. The primary goal of an investment strategy is to achieve the optimal balance between risk and return based on your financial goals, risk tolerance, and investment time horizon: 

  • 1. Asset Allocation: Diversifying your super investments across different asset classes, such as stocks, bonds, and property, can help manage risk and optimise returns over the long term.
  • 2. Risk Management: Assessing your risk tolerance and investment time horizon is essential for selecting appropriate investment options within your super fund. If you’re a conservative investor, you may prefer lower-risk options, while oppositely, if you’re an aggressive investor, you may opt for higher-risk, higher-reward investments.
  • 3. Regular Review: Monitoring and periodically reviewing your super investment portfolio is essential for ensuring it remains aligned with your financial goals and risk tolerance. Adjustments may be necessary based on changing market conditions or personal circumstances. Regular reviews with a financial planner can provide valuable insights and adjustments to keep your investments on track.


Determining Your Retirement Needs 

  • 1. Retirement Lifestyle: Consider the lifestyle you envision for your retirement years, including housing, travel, healthcare, and leisure activities. Estimating your expected expenses can help determine how much super you’ll need to support your desired lifestyle.
  • 2. Superannuation Gap: Calculate the gap between your projected retirement expenses and your expected super balance. Identifying any shortfall early allows you to implement strategies to bridge the gap, such as increasing contributions or adjusting investment strategies.
  • 3. Age Pension Considerations: Factor in any potential Age Pension entitlements when estimating your retirement income. Understanding your eligibility for government benefits can impact your overall retirement planning strategy.


At LIFE Financial Planners, we’re dedicated to helping you take control of your financial future and utilise the full potential of your superannuation benefits. Don’t leave your retirement savings to chance—let us empower you to achieve a secure and prosperous retirement with our expert superannuation advice. Reach out to Marijana or Mei today at (08) 9322 1882 to schedule a consultation at our West Perth office. 

Cottesloe Beach - Retirement in Perth

Your Comprehensive Guide to Retirement Planning in Perth   

Perth is experiencing rapid growth, and navigating the financial landscape amidst this transformation may be essential in planning your retirement in this ever-changing city. Our team of experienced financial planners are here to guide you through all the essential steps for Retirement, covering key aspects such as preliminary research, understanding debt and implementing effective planning.


Step 1: Preliminary Understanding of Your Retirement Needs 

Retirement planning begins with a clear understanding of your desired lifestyle in Perth. Start by assessing your expected expenses, including housing costs, healthcare, leisure activities, and potential travel. Consider the unique aspects of living in Perth, such as the property market trends and lifestyle preferences, to accurately estimate your retirement budget.


Our team at Life Financial Planners specialise in crafting personalised retirement plans tailored to you. 


Step 2: Planning Your Superannuation Strategy  

Superannuation is a cornerstone of retirement funding. Consider options like salary sacrifice, where you can agree with your employer to contribute to your super from your pre-tax salary. Other strategies include voluntary contributions and investment diversification. This can help lower your income tax while boosting your retirement savings.  


Our retirement experts at Life Financial Planners can assist you in maximising tax-effective superannuation options. We’ll work with you to ensure your superannuation strategy aligns with your retirement goals. 


Step 3: Understanding Your Retirement Environment 

Beyond superannuation, there are opportunities, like leveraging the government-age pension and other available investment avenues. Diversify your retirement income sources to mitigate financial risks and capitalise on opportunities. Or explore local investment options, such as property or shares, with the guidance of our Perth-based retirement planners to enhance your retirement income streams. 


Step 4: How Debt Affects Retirement Planning

As you approach retirement, it’s essential to prioritise your finances to ensure a smooth transition into this next chapter of life. Debt management plays a crucial role in retirement readiness. Identify and prioritise debt reduction strategies and consider Perth’s property market dynamics and interest rate trends.


Start by tackling high-cost debts that could impact your retirement savings and lifestyle. Strategically paying off these debts, you’ll pave the way for a more financially secure future. Our team at Life Financial Planners can provide tailored advice on managing debt effectively as part of your retirement plan. 


Step 5: Putting Your Retirement Plan into Action  

Once you’ve crafted a comprehensive retirement plan, take proactive steps to implement it. Regularly review and adjust your plan to remain relevant and aligned with your retirement goals amidst an evolving economic landscape. You can also discuss it with our team, who can leverage local expertise to provide ongoing support and guidance as you navigate the path to a secure and fulfilling retirement. 


How Life Financial Planners can help you with Retirement Planning Advice in Perth 

Effective retirement planning can significantly impact your financial future and quality of life. Whether retirement is right around the corner or still a distant thought, having a robust financial strategy can bring clarity and confidence to your future outlook. 


At Life Financial Planners, we’re committed to guiding you through every stage of your retirement planning journey. Our experienced team of financial planners specialises in crafting personalised strategies tailored to your unique retirement goals and aspirations.


Reach out to Marijana or Mei at our West Perth office by calling 08 9322 1882. Let’s start a conversation about securing your retirement with confidence and clarity. 


Financial Advisers for Investments

How a Financial Adviser Can Help You With Investing 

While the world of investments can seem complex and daunting, partnering with a knowledgeable Financial Adviser can make all the difference. Here at Life Financial Planners in Perth, we’re committed to guiding you through the intricacies of investing and helping you build a robust investment strategy tailored to your needs. Let’s delve into how a financial adviser in Perth can assist you in making informed investment decisions. 


Understanding Your Financial Goals

Understanding your unique financial goals and aspirations is the first step towards successful investing. First and foremost, it’s all about taking time to understand your unique financial goals and aspirations. Whether you’re saving for a major purchase, financial planning for retirement, or aiming to grow your wealth, our Perth financial advisers will work closely with you to define clear objectives that drive your investment strategy.


Staying Educated and Informed

Investing wisely requires a strategic approach, commitment and continuous learning. As financial planners, we understand the importance of investment advice and staying informed about investment strategies, market trends, and fundamental principles to assist you in achieving your financial goals effectively. 


One key aspect of our role is to help you avoid making impulsive investment decisions based on short-term market movements. Instead, we’d like to emphasise the importance of prioritising your long-term financial objectives and maintaining discipline in your investment approach. As your trusted advisor, we can provide personalised guidance, tailored strategies, and professional insights to help you make informed investment decisions aligned with your objectives, aspirations, and overall financial plan.


Conducting In-Depth Investment Research


To generate effective results, we have access to an extensive network of resources and market insights that enable them to conduct thorough investment research. We analyse various asset classes, investment products, and market trends to identify opportunities aligned with your investment strategy. A research-driven approach ensures that your investments are adapted based on well-informed observations and positioned to achieve your financial objectives. 


Assessing Risk Tolerance 


Investing involves varying degrees of risk, and determining your risk tolerance is crucial in selecting suitable investments. A Perth financial adviser will assess your comfort level with risk and volatility, considering your age, financial situation, and investment experience. This assessment helps design an investment portfolio that matches your risk profile, ensuring you’re comfortable with the investment decisions made. 


Designing a Diversified Portfolio 


One of the fundamental principles of investing is diversification. As financial advisers, we will construct a diversified investment portfolio tailored to your goals and risk tolerance. This portfolio may include a mix of defensive investments (like cash and fixed interest) and growth investments (like shares and property), aiming to optimise returns while managing risk effectively. 


Monitoring and Adjusting Investments


Monitoring your investments allows us to track performance against benchmarks and assess market conditions effectively. By continuously monitoring your investment portfolio, we can identify opportunities and risks promptly, enabling us to make proactive adjustments when necessary. This proactive approach helps ensure your investment strategy aligns with your evolving financial objectives and risk tolerance. 


Regular reviews and updates are essential components of successful investment management. They give you the confidence and peace of mind that your financial plan is adaptable and responsive to changing market dynamics and personal circumstances. As your dedicated financial advisers, we work closely with you to optimise your investment portfolio and achieve your long-term financial aspirations. 


Ready to take the Next Step with a Perth Financial Adviser? 


At Life Financial Planners, our mission is to empower you to make confident investment decisions. Our Perth financial advisers are committed to providing personalised guidance and support, ensuring your investment strategy reflects your aspirations and evolves with your circumstances. 


Reach out to Marijana or Mei at our West Perth office by calling 08 9322 1882. Let’s start the conversation about securing your retirement with confidence and clarity. 

Perth Financial Advisers

How to Invest Basics from Financial Advisers You Can Trust

At Life Financial Planners, we understand that investing can seem daunting, but it doesn’t have to be. With the right knowledge, guidance and investment advice, you can navigate the world of investments confidently and effectively. Let’s explore the basics of investing and discover how you can take control of your financial future right here in Perth.

Plan, Research, and Diversify 

When it comes to investing, planning, researching, and diversifying are paramount. These three principles serve as the foundation for successful investing, helping you find investments that align with your risk tolerance and financial goals. By following these golden rules, you can make informed decisions and accelerate your journey towards financial freedom. 


Golden Rules of Investing 

Before diving into the specifics of investments, it’s essential to adhere to some golden rules: 


Pay off Your Debts First: Prioritise paying off any outstanding debts, such as credit cards or personal loans, before venturing into investments.

Build Emergency Savings: Ensure you have enough savings to cover at least three months’ worth of expenses. This safety net will prevent you from having to sell investments in case of emergencies.


Investing with Perth Financial Advisers

Once you have your debts under control and emergency savings in place, it’s time to focus on investing for your future. At LIFE Financial Planners, we’re here to help you every step of the way. Our six-step process begins with a thorough discussion of your financial goals and attitudes towards investment risk. 

Our top Perth financial adviser then designs an investment asset allocation specifically tailored to you, which we implement and monitor regularly. Our team conducts extensive research and analysis to ensure that our recommendations are current and relevant to your unique circumstances. 


Examples of Investments 

Let’s explore some examples of defensive and growth investments:

Defensive Investments: 

Cash: Bank accounts, high-interest savings accounts, and term deposits are examples of cash investments. These provide a low-risk option for short-term financial goals and serve as a safety net in your investment portfolio. 

Fixed Interest: Government bonds, corporate bonds, debentures, and capital notes fall under fixed-interest investments. These offer steady income and lower risk compared to growth investments. 


Growth Investments:

Property: Investing in residential or commercial properties can provide both rental income and capital growth over the long term. While property investments carry higher risk, they offer the potential for substantial returns. 

Shares: Investing in shares involves purchasing ownership in a company. Shares offer the potential for significant capital growth and may also provide income through dividends. However, they come with higher risk and can be volatile in the short term. 


Staying Informed from Perth Financial Advisers

With ever-changing market and economic conditions, staying informed is crucial. At each of your regular portfolio reviews, we provide research for all of your recommended investments and explain the reasoning behind all recommendations. It’s essential to know that your portfolio is researched, structured, and, most importantly, tailored to you and your goals. 

At Life Financial Planners, we understand that investing can seem daunting, but it doesn’t have to be. We’re committed to helping you build a secure financial future through strategic financial planning. Contact Marijana or Mei today at (08) 9322 1882 to schedule a consultation and take the first step towards achieving your financial goals. Don’t wait any longer to invest in your future with LIFE Financial Planners. 

super annuation

Understand Super: How a Perth Financial Planner Can Help You 

In Australia, superannuation, or simply “super,” is not just a savings plan—it’s your ticket to a secure and prosperous retirement. At LIFE Financial Planners, we understand the importance of making informed decisions about your super, which is why we’re here to empower you every step of the way.


Understanding Superannuation 

Superannuation is a long-term savings plan designed to provide for your retirement. It operates on a simple premise: your employer contributes a percentage of your earnings into your super account, which is then invested by your super fund until you retire. These contributions, along with potential investment earnings, form the basis of your retirement income. 


Choosing the Right SuperFund 

Superannuation is more than just a savings account; it’s a long-term investment in your future. Your employer contributes a percentage of your earnings into your super account, which is then invested by your super fund until you retire. These contributions, along with potential investment earnings, form the foundation of your retirement income.  


Types of Superannuation 

In Australia, super funds generally fall into four main categories: retail, industry, public sector, and corporate. Each type of fund has its unique characteristics and target audience:

  1. Retail Super Funds: Run by banks or investment companies, retail funds offer various investment options and cater to you regardless of industry and background.
  2. Industry Super Funds: These funds are typically run to benefit members within specific industries, such as healthcare or education. They often offer competitive fees and profit-for-member structures.
  3. Public Sector Super Funds: Reserved for government employees, public sector funds provide modest investment choices and low fees, with profits reinvested into the fund for the benefit of members.
  4. Corporate Super Funds: Arranged by employers for their employees, corporate funds vary in structure and offerings. Larger companies may operate with their own funds, while others may opt for retail or industry fund options.


How a Perth Financial Adviser Can Help You

At LIFE Financial Planners, we understand the importance of your recommended superannuation funds—it’s not just another account; it’s your future. With the ever-changing landscape of super in Australia, having experts on your side is crucial. Here’s how we can help: 


  1. 1. Track down your lost super. There is over $18 billion worth of lost super in Australia. Some of it may be yours.
  2. 2. Choose the right fund for your needs.
  3. 3. Tailor an investment strategy for you.
  4. 4. Work out how much you need to contribute to your working life to live the retirement you want.
  5. 5. Boost your super! We can show you how to make the most of various tax-saving concessions such as salary sacrifice and contribution strategies.
  6. 6. Use your super to tax effectively provide for you and your family in the event of misfortune.
  7. 7. Ensure your super goes to the right people at the right time in the event of your passing.
  8. 8. Stay up to date with legislative changes, so you’re not disadvantaged.


At LIFE Financial Planners, we’re committed to helping you take control of your financial future and grow your superannuation benefits. Don’t leave your retirement savings to chance—let us empower you with the full potential of your super. Together, we’ll create a tailored strategy to ensure your super works its hardest for you, paving the way for a secure and prosperous retirement. Contact Marijana or Mei today at (08) 9322 1882 to schedule a consultation in our West Perth office.  

Life Financial Planners: Seniors

Why Hire LIFE Financial Planners in Perth? 

For over 20 years, we have been providing financial planning services in Perth. Our long-standing commitment to empower clients to plan a successful lifestyle all the way through to retirement and beyond. It’s important to understand what the role of and the services we provide as dedicated financial planners are. To help you decide if you should choose to work with us.

What Does a Financial Planner Do?

We will work with you to define your goals and help you to create the lifestyle you would like to live once we understand your goals and objectives and all the resources available to you. We then craft a comprehensive plan to achieve them. Depending on what stage of life you’re at, this could be funding children’s education costs, upgrading the family home, or reducing debt as soon as possible. Ensuring a comfortable lifestyle for your family all the way to your retirement, then managing pensions and withdrawals or planning for long-term care. We will help you to accomplish both your short-term and long-term lifestyle and retirement goals with our tailored strategies. 

Our tasks include: 

  • Goal setting  
  • Wealth creation 
  • Cash flow management 
  • Superannuation  
  • Tax planning 
  • Centrelink 
  • Estate planning  
  • Insurances- Life & Income Protection 
  • Education funds 
  • Investment structures 
  • Retirement planning 
  • Self-Managed Super Fund

Choosing the Right Financial Planner in Perth

So, you’re ready to take the opportunity and seek financial planning. But how do you choose the right financial planner for your needs? It’s essential to ask yourself the tough questions. What are their credentials? Can they provide references? How do they charge? These are just a few of the crucial questions to consider before making your decision. Remember, the right financial planner can make all the difference in achieving your financial goals. Whether you’re preparing for retirement, managing windfalls, or navigating major life transitions, we’ve got the expertise and knowledge to guide you through it all. Plus, we’ll help you steer clear of those so-called “investment gurus” and focus on what truly matters: building a solid financial future.

The Bottom Line

Financial planners aren’t just for the wealthy; they’re for everyone who wants to take control of their financial future. At LIFE Financial Planners, we’re committed to helping you achieve your goals, no matter how big or small. If you’re ready to take the next step towards financial freedom, don’t hesitate to contact Marijana or Mei at our West Perth office by dialling 08 9322 1882. Together, we’ll create a tailored plan that works seamlessly for you. 

Retirement Planning Perth

A Guide to Understanding Retirement Planning in Perth

At Life Financial Planners, we understand that your retirement journey is a significant milestone and requires careful evaluation of your financial readiness. As you prepare to embark on this new chapter, it’s important to assess your current financial standing and plan carefully to ensure a smooth transition into retirement. Our experienced team at Perth Financial Adviser is here to guide you through these essential steps, covering key aspects such as healthcare, well-being, lifestyle, and legacy planning.

Assessing Your Financial Readiness – Retirement Savings and Investments

Before you retire, the most essential step is to evaluate your financial readiness. This involves assessing both your retirement savings and investments to determine if they align with where you envision your retirement goals. At Life Financial Planners, our expert advisers can work with you to conduct a comprehensive review of your financial position, considering factors such as risk tolerance, investment performance, and retirement income projections. We will work with you to develop a tailored retirement strategy that maximises your savings and minimises financial risks.

Understanding Centrelink Age Pension Benefits

For many Australians, Centrelink Age Pension benefits form a significant part of their retirement income. Navigating the complexities of pension and social security benefits can be daunting, but you don’t have to do it alone. Our team at Life Financial Planners has extensive knowledge and expertise in this area and can help you understand your entitlements and optimise your benefits for retirement. Ensuring you maximise your entitlements and plan for any potential changes in government policies.

Healthcare and Well-being in Retirement

As you plan for retirement, it’s essential to consider your healthcare needs and overall well-being. This includes planning for healthcare costs and maintaining your physical and mental health throughout retirement.

Planning for Healthcare Costs

Healthcare costs can be a significant expense in retirement, especially as you age and may require more medical care. Our advisers can assist you in estimating your healthcare expenses and exploring options for healthcare coverage, such as private health insurance and Medicare, developing strategies to cover these costs effectively. By planning ahead, you can ensure you have the resources to cover medical expenses and maintain your quality of life in retirement.

Maintaining Physical and Mental Health

Retirement is about more than just financial preparation; it’s also about maintaining physical and mental well-being. Our comprehensive approach to retirement planning includes considerations for your health and happiness, ensuring you can enjoy a fulfilling and active lifestyle.

Lifestyle and Legacy Planning

Defining Retirement Goals and Aspirations

Your retirement should be a time to pursue your passions, interests, and dreams to the fullest. Whether travelling the world, spending time with family or pursuing hobbies, our team will work closely with you to define your retirement goals and aspirations. By understanding your vision for retirement, we can tailor a plan that aligns smoothest with your dreams.

Creating a Legacy and Estate Plan

Planning for the future also involves considering your legacy and estate. Our advisers can help you create a comprehensive estate plan that ensures your assets are distributed according to your wishes and minimises tax implications for your beneficiaries. With our guidance, you can leave a lasting legacy for your loved ones and ensure your wishes are carried out effectively.

Plan your Retirement in Perth Successfully: Partner with a Perth Financial Planner

Financial planning assistance can make a significant difference in helping your Retirement planning. Whether you are on the brink of retirement or just beginning to contemplate it, having a solid financial strategy in place can provide you with clarity and confidence about your future.

Here at Life Financial Planners, we stand by your side, dedicated to empowering your retirement planning journey. With our experienced planners, we are equipped to guide you through navigating your retirement investments, ensuring a smooth transition process, and implementing invaluable strategies tailored to support your unique retirement lifestyle.

If you are eager to delve into discussions about your financial future and craft a retirement plan that aligns with your goals, don’t hesitate to contact Marijana or Mei at our West Perth office by dialling (08) 9322 1882. We are committed to helping you understand all aspects of financial planning for retirement and creating a tailored plan that works seamlessly for you.

Government changes affecting pensioners

Government Changes to Employment Paper in 2024

In a significant move to encourage workforce participation among pensioners, the Australian government has introduced changes outlined in its new employment white paper that may affect you. Two key amendments, the permanent increase of the work bonus and the doubling of the nil rate period, are set to provide pensioners with enhanced flexibility and reduced concerns about losing income support while returning to work. 

  1. Permanent Increase of Work Bonus:

The government’s employment white paper introduces a permanent increase in the work bonus, allowing you to retain more of your pension while employed. Effective January 1, pending parliamentary approval, if you’re a new pensioner, you’ll start with a work bonus income bank balance of $4,000, compared to the previous $0. Pre-existing and new recipients will maintain an elevated maximum work bonus balance limit of $11,800, up from $7,800. 

  1. Doubling of Nil Rate Period:

The nil rate period, applicable to income support recipients, will be extended from six to 12 fortnights. This extension grants any recipient twice the amount of time to receive income from employment before facing a potential loss of government support. The change aims to alleviate concerns about the temporary nature of work and aims to encourage you to take up short-term employment without fearing immediate consequences. 

  1. Removal of Disincentives and Smoother Transitions:

These changes are intended to provide you with more confidence should you choose to re-enter the workforce before completely retiring. With an increased work bonus and a longer grace period, stepping back into the workforce is now a much smoother process. Removing the stress factor of losing perks or reapplying for support if your short-term opportunity doesn’t pan out. 

How it affects your financial planning for retirement: 

Extended Work Opportunities 

  • The permanent increase in the work bonus allows you to retain more of your pension while engaged in employment—an additional financial incentive for you to consider working for a more extended period before financial planning for retirement. 
  • The doubling of the nil rate period provides a longer window for income support recipients to receive income from employment without losing government support. It may be worth exploring part-time or short-term work opportunities if you’re nearing retirement. 

Flexible Retirement Transition: 

  • A smoother transition into retirement means you can feel more flexibility in chasing short-term work without immediate concerns about the loss of concessions or the need to reapply for support if the work arrangement doesn’t continue. 

Budgeting for Retirement: 

  • The extended work opportunities may influence decisions about the timing of your retirement and the amount of income to be generated through employment before fully retiring.

Potential Impact on Superannuation: 

  • While the changes primarily focus on pensioners and income support recipients, it’s important to note that if you currently have a superannuation account, you may be affected. Extended work periods could impact the timing and amount of superannuation contributions, affecting the overall retirement savings. 

Adaptation of Retirement Plans: 

  • If you are in the pre-retirement phase, you may need to adapt your retirement plans to consider the new opportunities and challenges presented by the changes. Factors such as part-time employment, continued skill development, and the evolving nature of the workforce may become more integral to retirement planning. 

With these changes, the Australian government is proactively addressing challenges related to workforce participation. With additional financial incentives and extended support periods, there is comfort in knowing that there is a long-term commitment to creating a supportive environment for any pensioners considering or returning to work, a positive step in the right direction for the future economic resilience of our country. 

If you’re unsure of any information shared, interested in how your retirement plan may be affected or have any general queries about retiring, contact us at (08) 9322 1882 / admin@lifefinancialplanners.com or visit our office located in West Perth. We’re ready to help you navigate your path to retirement. 


Newest Australian Retirement Trends, Reflect Longer Work Lives

The Australian Bureau of Statistics (ABS) has recently revealed data about a notable shift in retirement patterns for Australians. A large source of the findings relates to the upward trajectory in retirement age, especially for women, and how more Australians are choosing to stay in the workforce longer than ever before. Let’s delve into the key findings shaping the landscape of retirement advice in Australia. 

  1. A rise in Average Retirement Age:

The ABS data for 2020 indicates a significant change in the average age of retirement, which has increased by a year to 56.3 years. In the larger picture, this is signalling a shift in trend. Australians are opting for extended careers before embracing retirement. 

  1. Women’s Prolonged Workforce Participation:

A noteworthy aspect of this trend is the substantial increase in the average retirement age for women. From 2018 to 2020, women are now retiring at the age of 54, up from 52. This is a clear departure from traditional retirement age norms and reflects the growing trend of women staying actively engaged in the workforce. 

  1. Men’s Retirement Age Dynamics:

While the average retirement age for men decreased slightly from 59.5 years in 2018 to 59.3, the overall trend suggests a complex interplay of factors influencing retirement decisions among men. 

  1. Changing Perspectives on Retirement:

The conventional notion of retirement at 65 is transforming, with the average Australian intending to retire at that age. However, this intention contrasts with the actual retirement age, reflecting a desire among many to continue working beyond traditional retirement benchmarks. 

  1. Pension and Partner’s Income:

The ABS data underscores the pension’s continued significance as a primary income source for retirees. Interestingly, 34% of retired women rely on their partner’s income, emphasising the importance of financial independence for women in retirement. 

What does this mean for your retirement plan? 

The changing retirement landscape in Australia has several implications for if you are considering retirement or in the process of planning for retirement. Here are some key takeaways: 

  1. Extended Work-Life Expectancy:

If you are planning for retirement, there is a larger consideration of the potential for an extended work life. The consequences of this may involve reevaluating your retirement savings goals, investment strategies, and the anticipated duration of post-retirement financial support. 

  1. Redefining Retirement Age:

There is more common flexibility in the sentiment of retirement. The conventional retirement age of 65 is evolving, and it’s okay to opt for a later retirement based on personal preferences, health, and financial considerations. Your retirement plan should be flexible to accommodate any personal changes and preferences. 

  1. Gender-Specific Considerations:

Superannuation Planning for Women: The increase in the retirement age for women highlights the importance of tailored superannuation advice and planning. Initiatives such as contributing to super during paid parental leave can enhance financial security for women in retirement. 

  1. Health and Wellbeing in Retirement:

With a trend toward longer work lives, you can feel less pressure to leave the workforce entirely, instead opting to work part-time or engage in fulfilling activities post-retirement. Retirement plans should not only focus on financial aspects but also consider health, well-being, and opportunities for continued personal growth. 

  1. Pension and Income Sources:

Diverse Income Streams: As the pension remains a significant income source, retirees should assess their eligibility and plan for a mix of income streams. Diversification can include pensions, personal savings, and potentially continued part-time employment. 

  1. Regular Review of Retirement Plans:

Given the evolving retirement landscape, individuals should regularly assess and adapt their retirement plans. This includes reassessing financial goals, adjusting investment portfolios, and staying informed about changes in superannuation policies. 

As Australia witnesses a larger cultural shift in retirement culture, the data presented by the ABS paints a better picture of the state of our evolving work-life patterns. If you have questions about how this may affect you or wish to discuss your retirement plan, contact us at (08) 9322 1882, email admin@lifefinancialplanners.com or visit our contact page. We’re ready to help you navigate your path to retirement.