In general, people rarely talk about retirement planning and the expenses associated with it. However, as things change, people now seek early retirement planning services to ensure that their transition to retirement goes smoothly and efficiently.
However, financial planning is one of the most neglected topics covered in early retirement. But it is one of the most critical factors of retiring at an early age.
What are the top financial factors people should consider before retiring?
1. Daily Budget and Usual Expenses
People who want to retire early with enough money need to budget. You should take note of what expenses you need to afford to live comfortably in retirement.
Establishing a budget is one of the best early retirement planning tasks.
It is also a good idea to have a plan in place to properly manage your finances and make them last for an extended period. Your retirement may end up being longer than you think it is and you may have to find more income sources.
2. The Age Pension and Centrelink Benefits in Retirement
One of the most common early retirement planning tools recent retirees use for income is the Age Pension.
However, depending on your retirement income amount, you may only get a part pension or no pension at all.
If you want to maximise the amount you will receive from the age pension, work with a financial planner/retirement planner.
3. Health Care Costs
One of the most significant parts of a retirement plan is health care costs, especially if you or your spouse has a health problem or medical condition that requires regular attention.
Some of the typical health costs include health insurance premiums and out-of-pocket medical expenses. People who want to retire early and can afford it should have emergency funds and considerable savings to cover the potential costs of healthcare.
5. Establishing the Retirement Plan
A good retirement plan is one of the most critical factors of retiring early.
A good retirement plan can help you decide if you should continue working or retire early. Retirement planning is about knowing how much money you need and how to put your plan into action.
But without having a strategy and plan in place, you may feel worried that you will run out of money halfway through your retirement.
Work with a retirement planner to help plan your finances and savings for retirement.
Early retirement sounds exciting, but it is not as easy as people think. A lot of work and careful planning is needed if you want to retire early. Retirement planning is essential as it helps people understand their priorities and what they can do now with their finances to achieve early retirement.
Hyland Financial Planning can help you with early retirement planning
Through our retirement financial advice, we hope to help clients develop a sense of preparedness and stability for anything that may come their way. Seeking financial advice in Sydney or Hornsby?
