{"id":331688,"date":"2025-12-07T00:45:15","date_gmt":"2025-12-07T00:45:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/331688\/"},"modified":"2025-12-07T00:45:15","modified_gmt":"2025-12-07T00:45:15","slug":"huge-retirement-mistake-aussies-making","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/331688\/","title":{"rendered":"Huge retirement mistake Aussies making"},"content":{"rendered":"

Many Australians nearing retirement are making huge mistakes with their planning that is costing them time and money, a finance expert has revealed.<\/p>\n

Unfortunately, people are often oblivious to the mistakes they are making because they have nothing to do with getting into trouble with the Australian Taxation Office or contravening superannuation laws.<\/p>\n

Instead, the mistakes will result in retirement savings running out too early, causing people to work longer or result in people missing out on finance-boosting opportunities.<\/p>\n

Super Guy founder and chief executive Chris Strano says there are five main mistakes people often make when it comes to planning for their retirement.<\/p>\n

\"Three<\/p>\n

There are five main mistakes people often make when planning their retirement.<\/p>\n

Working too long<\/p>\n

The saddest part of people transitioning into retirement is that they often work much longer than they need to, Mr Strano warns.<\/p>\n

\u201cOf course, it\u2019s always best to be conservative with retirement planning, but many people are way too conservative,\u201d he said.<\/p>\n

\u201cMost of the people we work with had intended on working at least three or four years longer than they needed to until we explained they didn\u2019t have to.\u201d<\/p>\n

Mr Strano said some of the best years of a person\u2019s life came in their 60s.<\/p>\n

\u201cDo you really want to lose these years by working too long because you didn\u2019t bother going through the process of figuring out whether you actually had to or not?\u201d he said.<\/p>\n

Financial planners and advisers can assist with this, and there are also online calculators that can help.<\/p>\n

\"Senior<\/p>\n

Some of the best years of your life are in your 60s. Picture: iStock<\/p>\n

Not optimising your contribution strategy<\/p>\n

In your final working years you can significantly reduce immediate and future taxes by increasing your superannuation contributions.<\/p>\n

Types of contributions that can be made into superannuation include salary sacrificing, personal concessions, after-tax payments, spousal contributions, small business payments and downsizer contributions.<\/p>\n

\u201cThe types of contributions you should make and amounts will be determined by your particular circumstances, such as your taxable income, age, intended retirement date, super balance, employment status, and whether you are single or a member of a couple,\u201d Mr Strano said.<\/p>\n

\u201cUsually, in the lead-up to retirement, you want to be getting as much of your wealth into superannuation.<\/p>\n

\u201cHowever, this needs to be done in a tax-effective manner, within the super contribution limits and for the right reasons.<\/p>\n

\u201cNeglecting to implement an efficient contribution strategy is the most common mistake people make when saving for retirement.\u201d<\/p>\n

\"Mature<\/p>\n

In your final working years you should contribute as much as possible to your superannuation.<\/p>\n

Investment risk and return<\/p>\n

People might say \u201cI want to earn more than bank interest\u201d, or \u201cthe sharemarket is too risky\u201d, or \u201cmy friend\u2019s super earns more than mine\u201d \u2014 but that does not provide any context around the level of risk you should accept.<\/p>\n

\u201cMy mantra is that you should only take on as much investment risk as is required to meet your objectives,\u201d Mr Strano said.<\/p>\n

\u201cGenerally, a higher level of risk will result in a higher long-term return \u2014 albeit with higher fluctuations in your balance and a lower certainty of eventual outcome.<\/p>\n

\u201cConversely, a lower level of risk is likely to produce a lower comparable long-term return \u2014 with lower levels of volatility and a greater certainty of eventual outcome.\u201d<\/p>\n

Mr Strano said the risk of your portfolio should match the return needed to achieve your objectives and the level of risk you are comfortable with.<\/p>\n

\"Smiling<\/p>\n

Each year, the cost of living increases as a result of inflation.<\/p>\n

Failing to take inflation into account<\/p>\n

The cost of living increases with inflation.<\/p>\n

That means in 10 years, you will need about $80,000 to buy you what $60,000 buys you today.<\/p>\n

\u201cFailing to take into account inflation is one of the biggest mistakes a retiree can make, because inflation causes the dollar to lose its purchasing power over time, meaning you need to consider the investment returns required to keep up with inflation,\u201d Mr Strano said.<\/p>\n

\u201cBank accounts and term deposits, for instance, have no growth component and therefore lose purchasing power every single day.\u201d<\/p>\n

\"AUSTRALIA<\/p>\n

People often do not factor in the age pension when planning for retirement. Picture: NewsWire \/ Nicholas Eagar<\/p>\n

Not factoring in the age pension<\/p>\n

The age pension provides at least some support to most retirees.<\/p>\n

While eligibility criteria might change over time, Mr Strano said the payment would remain part of Australia\u2019s retirement system for many more years.<\/p>\n

\u201cSome people also write-off the age pension because they do not expect to be eligible for payments immediately upon attaining age 67, without realising that it will be a significant supplement to their income in their late 70s or early 80s, as their retirement savings begin to deplete,\u201d he said.<\/p>\n

\u201cYou can take the overconservative approach by not including age pension payments in your retirement calculations \u2026 but that would mean you\u2019ll be working an extra decade and missing out on your youngest and most enjoyable retirement years.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Many Australians nearing retirement are making huge mistakes with their planning that is costing them time and money,…\n","protected":false},"author":2,"featured_media":331689,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[64,63,99,185492,186,185494,185493,184,185,1793,6541,5792,25650],"class_list":["post-331688","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-au","tag-australia","tag-business","tag-chris-strano","tag-finance","tag-finance-expert","tag-mr-strano","tag-personal-finance","tag-personalfinance","tag-retirement","tag-retirement-planning","tag-superannuation","tag-superannuation-contributions"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/331688","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=331688"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/331688\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/331689"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=331688"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=331688"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=331688"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}