Talk Investing Podcast
The Talk Investing Podcast & Blog discusses investment advice from our previous podcasts and radio shows by Remo Greco & Marco Mellado. Learn all things around retirement and investing.
Talk Investing Podcast
How to Get Your Super in Shape for Retirement
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Retirement planning rarely begins with a spreadsheet. It begins with a sinking feeling when you check your super and wonder if you’ve missed the window. We slow that panic down and start where it actually matters: getting clear on what retirement looks like for you in Australia, not as a vague dream, but as a real year of choices about travel, work, social life, cars, and whether downsizing is on the cards. When you can picture the life, you can price it.
From there, we get practical about budgeting for retirement. Most people don’t keep a budget, and even fewer want to revisit a year or two of spending, but that exercise turns guesswork into a plan. We talk through the old 70 to 75 per cent “rule of thumb” for retirement spending, why the early years can cost more than you expect, and how later spending often tapers off. We also bring in the ASFA Retirement Standard numbers as a useful benchmark for a comfortable retirement, and why inflation can’t be ignored.
We then tackle the harder edge of retirement advice: managing debt, what changes if you don’t own your home, and why renting in retirement can require more capital and more flexibility. Finally, we touch on emerging product solutions and why annuities are becoming part of the conversation again when the goal is longevity of income, even if it means less access to big lump sums. If you want more grounded retirement planning advice, subscribe, share this with someone who’s stressing about their super, and leave us a review. What’s the one retirement question you want answered next?
DISCLAIMER: This podcast contains general financial information only. That means the information does not take into account your objectives, financial situation, or needs. Because of that, you should consider if the information is appropriate to you and your needs, before acting on it. If you’re confused about what that means or what your needs are, you should always consult a licensed and trusted financial planner. Unfortunately, we cannot guarantee the accuracy of the information in this podcast, including any financial, taxation, and/or legal information. Remember, past performance is not a reliable indicator of future performance. The Rask Group is NOT a qualified tax accountant, financial (tax) adviser, or financial adviser. Access The Rask Group's Financial Services Guide (FSG): https://www.rask.com.au/fsg
Welcome And General Advice
SPEAKER_00The Talk Investing podcast and blog discusses investment advice from our previous podcasts and radio shows by Remo Greco and Marco Melado. Learn all things around retirement and investing.
SPEAKER_01On the ABC Listen app, your smart speaker. And on your radio. This is ABC Radio Melbourne and Victoria. With Lisa Leon.
SPEAKER_03On the money.
SPEAKER_02With Lisa Leong on ABC Radio, and we're doing On the Money right now with superannuation specialist Marco Mulato. Good morning, Marco.
SPEAKER_03Nice to be here, Lisa. How are you?
SPEAKER_02Good. Anything we share here is general in nature. It doesn't take into account your personal circumstances, financial situations, or needs. But we are going to cover how to plan for your retirement.
When To Start Retirement Planning
SPEAKER_02What is the starting point, Marco?
SPEAKER_03Very good question. So starting point could be just starting to think about retirement and what that may look like. Trevor Burrus, Jr. At what age are we doing this? So there's no golden rule, there's no golden age, but uh you know, some suggest, and it's probably not a bad idea, is when that when that first thought pops into your mind around, oh boy, retirement is going to come up at some stage. Do I need to start thinking about it? Well, that's the time. Right. Don't put it off.
SPEAKER_02Trevor Burrus And I think that people get worried because they're actually quite old and going, have I left my run too late? So what do you say to that, Marco?
SPEAKER_03Aaron Ross Powell It's never too late. So the moment you think about it is the moment to start planning and preparing. But we don't want to leave it till the year before you're deciding to retire. Because then we're really racing against the clock to try and put stuff in place that we could have done five, ten, fifteen years ago. Trevor Burrus, Jr.
SPEAKER_02And so you get that feeling of panic, basically, like, oh no, I've left my run too late. And you check your super balance. I guess that's the first thing that people tend to do and go, okay, that looks dismal. So then let's say you're in that panicky state. What do you say you should actually try to do to help temper this a bit?
Turn The Dream Into A Lifestyle
SPEAKER_03Yeah, so there there's quite a few things you could do. So I would go back to basics and then start to think about what your retirement actually does look like. You may look at your balances in super, your other assets that you may have and think you may not have enough when in actual fact you may. So what is going to determine the amount of capital you need is the type of lifestyle you want to live. And you want to live your best life. What does that mean in dollar terms? Now that can be really hard to quantify. So that's when you might decide to engage an advisor to help you, or run on some of these culks that are on websites that help you determine the amount you might need. But the first thing is to try and work out what the lifestyle looks like.
SPEAKER_02And so are we sort of putting our dreams into reality? So rather than saying I'm sipping pina colada on the beach forever and ever, you're actually saying, what does your year look like? How many times are you going away on holidays? Are you an international traveler or are you just getting the caravan? Is that what you're saying? Exactly. Yeah, just bringing it to life a little bit. Are you working a little bit? Are you working a lot?
SPEAKER_03Let's be realistic about what the initial years are going to look like. And that may include slowing down work, not retiring permanently immediately. That may include a bit more travel, that may include a new car, it may include maybe downsizing the home if we need to. So there are so many factors that come into play. The first part is getting all that down, so at least you have the pieces of the jigsaw puzzle on the table. But then it's a matter of ordering them.
SPEAKER_02We're looking at how to plan for your retirement, how to avoid some of the mistakes that can be costly and set you back years inviting your questions. 1-300-22274 or your stories, maybe your tales that we can learn from as well when it comes to planning for your retirement.
Build A Realistic Retirement Budget
SPEAKER_02Then you say after the lifestyle, we're going to build a budget. So how specific do we need to be and what are the frameworks we can use to get us there?
SPEAKER_03So this is a really good thing to do. Now budgets most people don't have them, let's be honest. They're difficult because you've really got to go through pay hopefully a year's worth of all of your expenses, and it's pretty confronting sometimes, sometimes a couple of years to average them out. But it's really important because that number or that range that might be spent in retirement is going to be a big determinant of whether A you can achieve your lifestyle and B the aim you need to have in terms of saving. So the objective for the amount of capital you're going to need. So unless we have some kind of framework around it, some number around it, we're flying a bit blind. So having a go at a budget doesn't mean looking at every single dollar you have spent and getting it right down to the cent. But it does mean having a look at your spending habits and how they might change in retirement.
SPEAKER_02What's the biggest change then? Let's say we do know what our average monthly spend is right now. Is there some sort of rule of thumb percentage-wise that might help us figure out, okay, what would that be in retirement when I don't have all the things that I have now?
SPEAKER_03Yeah, so what's been thrown around in the past, uh and these are very old rules of thumb, but it's generally 70 to 75 percent of what you would spend in your working life is what you may require in retirement, but that can vary a lot. And so we know that in the early years of retirement we may not have any debt, and so we don't have any loan repayments to make, but other things increase our spending. For example, we're definitely going to travel more. We know that, right? We're itching to travel, maybe eating out plans, we eat out a bit more, we socialise a bit more. We might want to help the kids and the grandkids a bit early on now that we're retired and we've got access to this money we didn't have access to before. So a lot of expenses that leave might be replaced with others in the early years, and then that generally tapers off over time as you kind of get all of that out of your system and you start to just maybe want to hang around home and your friends and family a bit more. So th all of that needs to be uh teased out. It's a bit different for everybody, and so it's a bit of an exercise in just understanding yourself and what it is that you want to live the best life
Using The ASFA Retirement Standard
SPEAKER_03you can.
SPEAKER_02Aaron Ross Powell We've covered this a few times on the show, but let's go through it again. ASFA. What is it? What does the standards say? Trevor Burrus, Jr.
SPEAKER_03ASPA is a uh a superannuation, um aligned, if you like, institution or foundation that helps put together some pretty good uh frameworks around what you might need in retirement. And so they generally annually put out some numbers around what sort of lifestyle would give you a comfortable retirement and what you need for that in terms of money. So their latest figures to deliver a pretty comfortable lifestyle for you. And so that might mean things like you eat out once a week, you have a gym membership, right? So these little extra perks you might not have if you were, for example, perhaps just on the age pension. So their numbers come in at if we're a couple, around $75,000 a year net in your hands after tax should deliver you a pretty comfortable lifestyle. If we're single, that figure's about $55,000. So mere guidelines, but they are you know they are designing those by capturing a lot of data. So there's some, you know, there's some truth and there's some seriousness to those numbers. Trevor Burrus, Jr.
SPEAKER_02And why would we or how would we use these?
SPEAKER_03So this is an objective, I guess. This is the this could be a starting point to say, right, I don't really know what my lifestyle in retirement may look like, but ASPA does, because they've seen hundreds and hundreds of thousands of people retire and have actually got the data. Maybe that's my starting point, and then I can start to determine.
SPEAKER_02What's your take? Is it a bit low, is it a bit high? Do people struggle on that amount? No, I'd say it's about right. Because it's from the data, right?
SPEAKER_03I'd say certainly for a couple, $75,000. So that's, you know, $1,500 odd dollars a week in your hands. Now, this is a lifestyle that's not you know, you're not eating caviar here. But it but it's nice. It's comfortable. It's certainly a step up from the age pension. Beautiful. And we see quite a bit of this in our business, and we think those numbers are pretty right. Uh but inflation has a role to play in the last couple of years has been a very high inflation environment. So perhaps those numbers have been a bit too low.
SPEAKER_02Speaking with Marco Millardo, superannuation specialist, we're talking about retirement and how to plan for it.
Starting At 19 Without Overdoing It
SPEAKER_02I do have a text here saying, Morning, Lisa. My mother told me to start preparing for the future and retirement when I was nineteen and started working. Is that too early or a good time to start preparing? Marco. Trevor Burrus, Jr.
SPEAKER_03I'm biased. I'd say that's a great time to start preparing. You've got a lot of other things that are going to happen in your life.
SPEAKER_02What does it mean to start preparing for retirement when you're nineteen?
SPEAKER_03I think at that age, all it really means is making sure you have a super fund that's correct for you and making sure the right amount's going in. That's it. Because you have got ahead of you mortgages, potentially family, travel, all sorts of stuff going on that's going to supersede all of that. But if you get your super fund right now, you're not going to be able to do that. And don't wait.
SPEAKER_02And then so when you're looking at it, like don't go crazy on trying to put everything into super, but No, no, I wouldn't I wouldn't be doing that at 19.
SPEAKER_03Yeah. There's so many uh swerves you're going to have to go through. But you know, getting your super fund at least right at an early age, you just don't have to worry about that later on.
SPEAKER_02So apart from superannuation, are there other frameworks or things that we should be aware of when we're planning for our
Debt And Renting In Retirement
SPEAKER_02retirement?
SPEAKER_03There's a lot. And so a lot goes into retirement planning. And so one of them is just managing debt. Right? What we really want to do is be heading into retirement either debt-free or with very minimal debt. Trevor Burrus, Jr.
SPEAKER_02Can I ask you this question then from our texture here, Marco? What are your thoughts on retirement for people who don't own their own home? What should we do?
SPEAKER_03Talk about debt. Okay. So we uh I mean the obviously the obvious thing here is we've got a new expense, an extra expense, which is rent. And so we have to be able to cover not only our lifestyle but our rent as well. And so this is where we need to start early and understand am I likely to be a non-homeowner in retirement? And if so, do I need a bit more capital because I need to cover that rent expense? And so that's on the financial side. And then on the human side of it, of course, we need to it's a bit confronting because we need to understand that maybe we don't have the same rental place for all of our retirement. We may have a couple of moves.
SPEAKER_02And as far, does that assume that you own your own home, then?
SPEAKER_03Good pick up, Lisa, it does. It does assume you own your own home. So if we don't do that, we need to address So no mortgages in there. No mortgage, no rent. Yeah.
SPEAKER_02And I feel like that could change now for people.
SPEAKER_03I think it is changing now. I think in the next twenty or thirty years we're going to see a lot more retirees that don't own their own home. And we probably need some better product solutions for that, which are not here yet, and I know they're being worked on.
Product Solutions And Annuities
SPEAKER_03What do you mean by product solutions? Trevor Burrus, Jr. Product solutions are take into account uh there's perhaps a rental expense that we need to meet, and that give us a bit more longevity out of our capital in a really smart way. So you know, one of the changes might be at the moment, once we retire, we just have free and ac you know, free and unlimited access to our super balance. And we can and that can be used in any way, shape, or form you like. Uh that not necessarily has always been the case. There have been limits and guardrails around that to to to get your capital to last a bit longer for you. So perhaps we're going back to some of those days at some point. Annuities are starting to get a little bit more popular. We could do a a a whole nother show on those. But the the aim of annuities is to just get your money lasting longer. Right. Now it does restrict you because you can't draw big lump sums, but it's going to get you further. And so maybe it's a combination of the thing.
SPEAKER_02It's so hard to weigh this up, isn't it?
