The first thing you need to do is to work out how much money you will need in order to live the life you want when you stop work. Once you have figured that out, you need to look at your finances, and see whether you will be able to afford it. While your employer contributes to your superannuation fund every pay cycle, this is probably not going to be sufficient to fund a comfortable retirement, so some form of investment to build wealth will likely be a necessary part of your financial planning for the future.
How much does the average Australian need to retire?
Research conducted by the Association of Superannuation Funds of Australia (ASDA) found that a single retiree requires $446 per week, or $23,175 a year, to live modestly. If you are aiming for a comfortable lifestyle, which includes allowances for a car, private health insurance, and leisure activities such as holidays, you will need $810 per week ($42,168 a year) for a single, and $1,109 per week ($57,665 a year) for a couple.
When you consider the increase in our life expectancies, as well as the age increase in eligibility for the pension, you need a much larger nest egg than in previous generations.
What can you do now to build your wealth?
There are a number of investment options out there, including shares and property. With professional advice based on your circumstances and financial wealth goals, property is a sound investment choice. It’s a tangible asset, unlike shares, and it is a stable and easily understood way of building wealth.
Advantages of property investment
- You can reap many financial rewards by adding property to your investment portfolio.
- Property is historically less volatile than other investment strategies, such as shares.
- You can control and influence the value of your investment through regular maintenance, improvements, and good property management.
- A well chosen residential property will generally increase in value over the long term – as the demand for property in a popular area increases, so too will the value of your investment.
- Tenants will help repay the mortgage, and then once the property is paid off, the rental income can supplement your retirement income.
There are many tax benefits associated with property investment, including deductible costs, depreciation of assets, and negative gearing.
Knowledge is vital when it comes to building wealth through successful property investment. It’s important to have your individual circumstances and financial goals assessed by someone with expert knowledge of the industry.
Property Equity Builders can help you to pay the debt off your home faster, as well as build wealth and achieve the retirement you are planning through property investment. We provide a range of services, including the sale of full turnkey investment properties and property investment training. Contact us for help in building wealth for a comfortable retirement.
*This article is for general information purposes only. It is not intended as financial or investment advice and should not be construed or relied on as such. Before making any commitment of a financial nature you should seek advice from a qualified and registered financial or investment adviser.
PEB Group is a complete property advisory service for Perth families. Offices are located in Inglewood and Willetton, Perth, Western Australia and offer service in - Financial Planning · Finance Broking · Property Management · Property Sales · Property Investment · Development
PEB Real Estate - Licensee PEB Real Estate Pty Ltd. Trading as PEB Real Estate ABN 33 604 199 617. Triennial Number RA70508
PEB Financial Planning - Howarth (WA) Pty Ltd ARN 433328 trading as PEB Financial Planning is a Corporate Authorised Representative of NEO Financial Solutions Pty Ltd. AFSL 385845 | ABN 64 141 607 098
Fungroup Enterprise Pty Ltd | ABN 50 104 943 412 | Australian Credit Licence 389510 | trading as PEB Finance | ABN 50 104 943 142 | Australian Credit Licence 389510