00:00 When I talk to people about this, there's clearly a really commonly held thought that
00:05 you need a million dollars to retire.
00:08 And I think that number got thrown around so much that it's just ingrained itself in
00:12 people's minds.
00:13 But the latest research that's come out is suggesting that to retire comfortably for
00:19 an individual, you may need around $595,000 in total, and for a couple around $690,000
00:27 collectively.
00:28 Now, there are some caveats to that, and one of course is that what a comfortable lifestyle
00:33 is obviously varies greatly between people and how you would define that.
00:38 But the second one that I think is really interesting that's probably getting less attention
00:41 is that it also assumes that you own your own home at that point and you own it outright.
00:47 And that's obviously a trend that may be starting to change with younger generations.
00:51 Yeah, right.
00:52 So it actually could be more dire than the numbers are saying, if there is that assumption
00:57 of home ownership there.
00:59 What is your advice to people who are nearing retirement on lower balances that don't have
01:04 anything near that $595,000?
01:08 I think there's a couple of things to think about.
01:11 One is that even once you retire, you're not using all your money on day one.
01:16 So you've still got many years left to manage the funds that you do have well and to think
01:20 about how they're invested, which super fund they're invested with.
01:25 And so I think regardless of age, it's really important to take control of the situation
01:29 and to think about what you do have and what you can do, to think about whether there's
01:34 opportunity to provide additional contributions and to really start thinking about maybe getting
01:39 advice, professional advice about how you're going to work towards retirement.
01:43 And of course, the best time to start thinking about this is not in the years before you
01:47 retire, but in the years when you're young and probably are thinking about all sorts
01:52 of other things.
01:53 But if you can start planning in your 20s and 30s, that's going to make a really big
01:57 difference in later years.
01:58 Yeah.
01:59 This shortfall that many soon to be retirees might be facing, is that going to be the experience
02:05 for younger people entering the workforce today?
02:10 I think it's a good question.
02:11 I think that what we're seeing from the latest research is that we're expecting all the – what
02:15 the data's telling us is that by 2050, we're expecting around 50% of Australians to have
02:21 sufficient superannuation to retire comfortably.
02:24 Of course, there is an old age pension as well to supplement people's retirement savings.
02:28 So if you're on a lower balance, you don't need to have the full amount to ensure that
02:33 you can retire comfortably, and especially not to live a modest retirement.
02:39 But I think the worrying trend for younger people is that although we often talk about
02:44 the situation improving, I think we need to look at the superannuation system in tandem
02:48 with what's happening in the housing market.
02:50 And of course, if people aren't entering the housing market until they're in their late
02:54 40s or early 50s, by the time they have enough, say, for a deposit, they're likely not to
02:59 own their homes outright by the time they retire.
03:02 And so it's really looking at that broader picture.
03:04 [BLANK_AUDIO]
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