Retirement is something most of us look forward to. It’s a time for travel, family, hobbies, or simply enjoying the freedom of not working. But without careful planning, a few avoidable mistakes can make retirement more stressful than enjoyable. Here are seven of the most common traps retirees fall into, and how you can avoid them.
1. Not having a vision
A fulfilling retirement rarely falls into place without some forethought. Ask yourself what you want from these years. Is it travel, hobbies, or more time at home with family? Your vision will shape how much income you’ll need.
If there’s a gap between what you have and what you’ll need, strategies like topping up your super in the final years of work or using the downsizer contribution from the sale of your home may help boost your nest egg.
2. Underestimating inflation
Even the best-laid plans can be undone if inflation isn’t factored in. A retirement income that feels comfortable today may not stretch nearly as far in 10 or 15 years. Ensuring your investments include some growth assets, and reviewing your plan regularly, may help protect your spending power over time.
3. Underestimating how long you’ll live
Australians are living longer, healthier lives. Planning only until age 85 could leave you financially exposed if you live into your 90s or beyond. Your plan should account for the possibility of a 25–30 year retirement, with strategies in place to make your income last the distance.
4. Getting the timing wrong
Retirement doesn’t always go according to plan. Illness, redundancy or market downturns can force some into early retirement, while others keep working longer than necessary out of uncertainty.
One common misconception is that you can only retire when you qualify for the Age Pension at 67. In fact, most people can access their super much earlier — typically between ages 55 and 60, depending on their date of birth. Understanding your options could open the door to retiring sooner than you think.
5. Leaving your super in the accumulation phase
Once you reach retirement age, leaving your super in the accumulation phase can be a costly mistake. Investment earnings in accumulation are taxed at up to 15%, while moving into an account-based pension generally makes earnings tax-free. Transitioning at the right time could mean thousands more in your pocket over the years.
6. Not taking advantage of your entitlements
The Age Pension is designed to supplement retirement income, but it requires active management. Centrelink assesses income and assets, and these can change as time goes on.
For example, lifestyle assets such as cars, boats and caravans don’t automatically depreciate in Centrelink’s system. Unless you update their value, you may receive less than you’re entitled to. Regularly reviewing your entitlements ensures you’re not missing out on valuable support.
7. Being too frugal
It might sound surprising, but one of the most common “sins” is spending too little. Many retirees pass away with much of their super untouched, missing out on experiences they could have enjoyed.
There’s nothing wrong with leaving an inheritance, but retirement should also be about living well. A balanced financial plan can give you the confidence to spend on the things that matter — whether that’s travel, time with family, or simply enjoying everyday comforts — without the fear of running out of money.
Avoiding these seven mistakes can help you move into retirement with confidence and peace of mind. The right financial strategy ensures your savings support the lifestyle you want for as long as you need.
Avoiding the 7 sins of retirement
At Halpin Wealth, our advisers work with clients every day to plan their retirement, optimise their super, and make the most of their entitlements. Most importantly, we help you enjoy the years ahead without unnecessary worry.
Book a no-cost, no-obligation conversation today and feel confident about how to avoid these seven mistakes as you move into retirement.
This information provided in this article is general advice only and has been prepared without taking into account your own objectives, financial situation or needs. Before making a financial decision based on this advice, you must consider whether it is appropriate in light of your own needs, objectives, and financial circumstances, and where relevant, obtain personal financial, taxation or legal advice. Where a financial product has been mentioned, you should obtain and read a copy of the Product Disclosure Statement (PDS) prior to making any decisions about whether to acquire a product.