How Much Money Do You Need To Retire? #Finance

how much money do we actually need to be able to retire comfortably and early in Australia I’m going to share with you a couple of strategies but also what is actually required right now in Australia to be retiring early you might be watching this in your 20s or 30s and you think hey

sitting on a beach at 45 is great or you might be at your 50s and thinking hey I need to secure my Financial Freedom otherwise I’m going to have to rely on the pension if you guys are interested in my thoughts then definitely keep watching hey he guys my name is Ravi and welcome back to

personal Finance with Ravi sh if you’re new here smash that subscribe button because I talk about Real Estate personal development and all things

Financial Freedom now as part of my research process I go through many articles educate myself and then speak to a lot of people and of course we have our own Consulting team at search property and we speak to so many of you guys that view the channel and watch the channel ongoing and a lot of the

questions that you guys are asking is around how much do I need to be able to retire early we all have this goal of Financial Freedom not having to get up on a Monday so I thought why not make a CashNews.co about this because I think there’s a few things that we can tweak and I don’t

really want to focus on just hey we need to buy property and do this and do this and do this I think there’s more around mindset so we’re going to cover off both right now now how much money do you need to retire early in Australia you can access your super between the ages of 60 to 65

depending on whether you’ve stopped working if elgible you can also receive the age pension from the age of 67 if you want to retire in your 40s or 50s you obviously need funds to bridge the gap and sustain your desired lifestyle longer term according to the latest figures from the ABS most

people expect to retire on average between their 65th and 66th birthday but for those planning an early retirement this may be too long to wait for context if you follow the trend which is go to school go to UNI get a job you’re pretty much in full-time employment by the time you’re

around 21 or 22 that’s exactly when I started getting into full-time work officially after I finished my uni degree from that point you’ve got another 44 to 45 years before you actually retire now I know that sounds like a lot and you may be watching this channel going I’ve not

known any other way that’s pretty much the norm I think with social media exposing so many people and their Lifestyles we’re sort of in this space where we want instant gratification and unfortunately that’s just how we are as a society now because we see people that are so much

further ahead and we say why aren’t we there yet but what you don’t see is the stuff that’s happened in the background for years and years and years take for instance running a business if you start running a business today and you compare yourself to someone who started their

business 10 years ago it is completely different equally if you go hey I’m going to start this passion project I’m going to start my new channel on Tik Tok you’re starting with zero now when you compare yourself to someone else they also started at zero and in this case if

you’re in your 20s and you’re seeing everyone else around you going well this is the norm this is what I’m going to do you don’t have to do the same thing in fact so many people make the wrong decision when it comes to buying their own place what’s their first property

going to look like and the reason I keep coming back to Real Estate is because a large portion of Australia’s wealth is all tied up in Real Estate whether we like to admit it or not we want to buy property that we hopefully can see appreciation in the

byproduct is yes we can live in there I know that if you bought a property and you said hey look I don’t really care if the prices go up I just want to live in this property there are very few of you out there that think about this completely emotionally where you say hey I just want to live

here I don’t care about the price what most likely is happening is someone told you that you should get into the property Market as soon as possible that way you can see the appreciation of your wealth and as a byproduct you get to live in it and that’s the mindset that is really

screwing up young Australians right now take my example for instance I did the exact opposite to all of my schoolmates and now 10 to 15 years later I don’t talk to any of them and the reason for that is because I felt like they didn’t understand me they didn’t understand that I

wanted the 1% life and that 1% life meant that I needed to go and invest and at the time I was fortunate enough to be living at home but I’ve been living out of home for the better part of almost 5 years now and so paying rent and investing is called rent investing I talk about it on the

channel but so many people still to this day think the only way is to go to school go to UNI get a job buy a house get married have kids and then retire at 65 for the few of you that actually want a different life and are open-minded to thinking like the 1% let’s continue the association of

super funds of Australia calculates you’ll need at least $72,000 per year to live comfortably in retirement as a couple and 51k as a single person this assumes you’ve already paid off your mortgage and that your Investments will achieve an annual return of 6% so

let’s break that down $772,000 as a couple or 51,000 as a single person now if you go as a single person that’s roughly about $11,000 and if you’re as a couple with pretty much about $600 to $700 per person now if you’ve got your house paid off that’s actually a really

good life now I know some people have a lavish lifestyle but if you actually think about it your groceries are costing you what 3 to 400 bucks a week I assume and then you’re looking at a couple of hundred bucks left over for you know entertainment and whatnot if you’ve already got the

house paid off this works quite well but how many people in today’s terms are going to get to 65 and not have a house paid off that is really scary and the bigger question to ask is how are you generating that Income because let’s say for instance you have your own

house it’s paid off you’ll most likely receive the pension but if you want to retire on your own terms and not have the government tell you what your budget is you’re going to need Investments yourself and it might be your super fund and the supers in invested

into a bunch of Markets if the market is giving you a 5% return then that is what dictates how much you can spend that year equally if it’s going up by 10% that year you might be able

to get a large Zinger box instead of just the normal one but this is all on the basis that you have your house paid off and you plan to retire at 65 now keep in mind you can’t access the pension until you’re 67 so even if you did decide I’ve got my house paid off and I want to

retire at 60 you won’t get any of the pension till you’re 67 and in that case you’re relying on the Income that your asset Assets generate or your Investments generate and I don’t know if that’s going to make enough of

it let’s say for example you have a million doll in your super fund now most people will never get to a million but let’s say let’s assume a million do if you get to a million do as a couple you would need to be generating at least 7.2% to be able to live comfortably according to

the asfa and if you’re a single person you’d need that million to be returning at least 5% so if you look at industry averages of say 7% you would need at least $800,000 in your super account a really good exercise for yourself right now especially if you’re in your 40s and edging

into your 50s is to calculate how much Super do you have and how much you’re going to end up with by the time you actually retire because if you can’t generate $50 to $70,000 with your house paid off you’re going to find yourself not living comfortably here in Australia one of the

other things that I haven’t really considered or talked about in this CashNews.co is Inflation and Inflation’s been a really hot topic for the last 3 to 4 years now are we going to see periods of high Inflation for a long period of time

nobody really knows but this is why you want choice you want to go hey I need to be proactive because if I see another situation which just happens to line up when I retire then the 7% that you’re getting is not going to mean much if Inflation is at 10% and that’s what

some pensioners had to go through now fortunately what happens when Inflation is really high is Interest Rates are high and as a byproduct of Interest Rates being high youve probably got Savings rates also high for those lucky few

oldies out there they were able to put their money into the bank accounts and generate a higher return than in most cases you would get in the market again without the volatility which is really important at that age ASA says a comfortable lifestyle includes expenses like Private health cover good

clothes reliable internet and streaming services rates and home repairs regular leisure activities like going to the movies the occasional takeout meal an annual domestic trip and one overseas trip every 7 years you can tell this is the first time I’m reading this because every 7 years is

pretty Bonkers especially if you’ve been watching anything online right now you’re like everyone seems to be overseas all the time some people are going multiple times every year so to be in a position where you can’t travel for a 7year period because you didn’t make the

right choices early on you only have yourself to blame and I know this is going to sound piercing but the reality is that we can only control what we control and if we decide that Australia is too expensive we’re probably going to have to move but Australia is one of the best countries in the

world in my opinion it is by far the best country which is why I plan to live here long term now I live in in Sydney which also means that it’s super expensive and that’s why you have to be planning ahead you have to be taking action early on now whether that’s going out there and

making a budget for the first time or whether it’s going out there and getting into the right circles to have advanced strategies to really help your wealth now what are some steps that you can take to actually retire early number one is going to be having a strong budget I know this sounds

silly for so many people but I really urge you to look into it because Budgeting is not as simple as what you thought it was which is hey Income comes in expenses go out look I’ve got 100 bucks at the end of the week happy days that goes into my

Savings account all that’s going to do is that by the end of the year when you decide you want to go on a holiday you’re going to go back to that Savings fund and says hey actually I did really well maybe I’ve got about $3,000 here I’m going

to use that for a trip and now you’ve just gone through the whole year only to end up into the same exact spot now if you’re someone who’s renting and hasn’t got any Investments you’re the one that really needs to start making moves because if you rent

and you invest rent vesting is actually really useful in fact that is probably a better strategy than just buying your own place but if you’re someone that rents and has no Investments and you take advantage of the fact that hey I don’t have a mortgage I don’t

have these things that means I’ve got more disposable Income to use on my lifestyle you’re going to find yourself in really deep trouble later on so in that case you’re better off just having your own property because chances are it will outperform

Inflation anyway now I’ve spoken about how to budget effectively you can simply search out budget Ravi shama on YouTube and you’ll find it there but one of the easiest things that you can do right now to get started is look at your expenses over the last 3 months and

look at the Income that you actually earn then from there you need to break down how much you’re actually spending on needs and wants and then how much you’re investing or saving you need that number of investing and saving to be as high as possible and I’ve

referenced the 50320 rule before 50% goes towards needs and that would be like rent and groceries 30% towards wants and 20% goes towards Savings and investing I would like to flip it around and say 50% of your Income should should go towards saving and investing

and if you can save enough to then be able to go and invest I would definitely go take that option above Savings number two is map this out you need a strategy here because we’re not just talking about hey having some goals written on paper and then 12 months go by and you

never achieve those New Year’s resolutions and then you go well no this year is different and you’re going to go back and create goals again you do that time and time again only to then be disappointed by the end of the year but in this case you’re talking about longer term

you’re talking about 20 to 30-year plans you need to be very crystal clear around the vision of what you want if you actually want to retire early you need to put that stuff down on paper and it could sound silly but by putting it on paper the likelihood of you achieving it drastically

improves now I’m not going to quote stats because frankly I don’t have stats in front of me it’s a large percentage increase from those who write down their goals to actually achieving it versus those who don’t write down their goals and they actually don’t achieve it

and my final one for you to retire early is get into the right conversations with the right people it astounds me that with so much information out there there are still people out there making the dumbest decisions like financially if you have to budget to make money to then invest you need to

take accountability and do it if you feel like you don’t make enough money you need to find another job or find a second job to be able to invest enough and if you do the moves early in your 20s and your 30s you’re going to find that it’s a lot easier by the time you’re 50

and 60 for the few that are listening to this and didn’t have the opportunity to do it or didn’t take the opportunity to do it in your your 20s and 30s it’s going to be a lot harder for you but it’s not impossible that’s why I urge you to have a strategy talk to the

right people and budget which is so simple right now and if you’re not doing it you’re in trouble if you need any help at all when it comes to building out the strategy when it comes to property and you have enough there but you have no idea what move to make next I’m going to

leave a link in the description box below you can reach out to us at search property and we not only find the property but we also provide that strategy that you’re going to need long term so I hope you guys have enjoyed this CashNews.co if you have smash SM that like button subscribe if you

haven’t already and I’ll catch you guys in the next one thanks guys