Retiring in your 60s may mean your super needs to last another 20 or even 30+ years. That’s why making sure your money can stretch further so you can enjoy retirement without running out of savings is just as important as building your balance.
The rising cost of living has been putting pressure on most of us, so it’s important to regularly review your spending and retirement strategy to ensure your super remains on track. A good starting point is ASFA’s retirement standards, which compare the cost of a modest and comfortable retirement, and MoneySmart’s retirement planner. They can help you understand how your current savings and spending habits stacks up, and whether you may need to adjust your expectations or strategy.
Once you’ve set a realistic spending limit, the next step is finding practical ways to make your super last longer while still supporting the lifestyle you want.
1. Make a budget
Making a budget is generally the first step in understanding and assessing where your money is going so you can make small changes to your habits. Even if you’re fully retired, it’s never too late!
Having a budget will offer transparency and give you a realistic expectation of your spending habits and targets. MoneySmart has some great online tools to get you started.
If you have a Vision Super Account based pension
To help you put your budgeting into perspective, you will receive an estimate of how much you could draw down from your pension via the Vision Super ‘Retirement Wage'.
This is sent to you once a year in your annual pension drawdown letter and is calculated based on your account balance, age, life expectancy and investment options.
2. Make sure you’re claiming your Commonwealth government benefits
If you’re over 67 (or about to turn 67) and you haven’t already, consider applying for the Age Pension. You can do this 13 weeks before your 67th birthday to ensure you don’t miss a payment. Your eligibility depends on residency requirements, and an income and assets test.
If you get a full or part Age Pension you’ll automatically get a Pensioner Concession Card – even if you only receive $1 of pension, your concession could mean a lot more in valuable savings! These vary from state to state but may include:
Reduced or free car registration – for example 50% off your rego in Victoria or free rego for one car in NSW
Rebates on electricity, gas and water bills
Cheaper medicines
Assistance with energy costs for essential medical equipment
Discounts on local council rates
Reduced-cost glasses, hearing services and other health services
It may also provide access to one-off government support payments.
3. Apply for a state senior’s card
As long as you’re a citizen or permanent resident, you’ll generally be able to apply for a Seniors Card from your state or territory government once you turn 60 (or 65 in some states) and are no longer working full time. These cards give you valuable concessions on public transport and discounts from participating businesses, which can help stretch your retirement dollars further.
State seniors’ cards are generally not means tested. You may even qualify if you are still working a few hours each week, so check the eligibility rules for your state. Learn more.
Click on the link for your state/territory to find out more:
4. Register for the Medicare Safety Net
Registering for the Medicare Safety Net can help reduce your out-of-pocket medical expenses for services like specialist appointments, scans and blood tests.
Whether you’re single or part of a couple, registering ensures your eligible out-of-pocket healthcare costs are tracked throughout the calendar year. Once you reach a certain threshold, Medicare provides a higher benefit for eligible services.
If you register as a couple or family, Services Australia will combine your medical expenses, which may help you reach the threshold sooner.
For more information, see the Services Australia website.
5. Other ways to reduce expenses
Small lifestyle changes can also help stretch your retirement savings further. Consider:
Reducing your gas and electricity bills by switching to LED lightbulbs, turning off appliances at the wall, and using the cold water setting on your washing machine.
Downsizing your home may reduce ongoing living costs
Cancelling unused subscriptions (like streaming or a landline phone) and buying in bulk.
Seeking out seniors’ discounts, traveling during off-peak times, and choosing restaurants that offer senior specials.
Using your free local library, visiting free museums or galleries, and attending community events. Many local libraries hold free information sessions about technology, cooking and art.
We’re here to help so if you’d like more information, call our Retirement Services team on 1300 017 589, Monday to Friday 8:30am to 5pm, or email memberservices@visionsuper.com.au.
Any advice in this article is general only and has been issued by Vision Super Pty Ltd (ABN 50 082 924 561) (AFSL 225054) as the Trustee of the Local Authorities Superannuation Fund (ABN 24 496 637 884) (‘Vision Super’). The advice does not take into account your personal objectives, financial situations or needs. Before acting on the advice, you should consider whether it is appropriate for you, having regard to your own circumstances, and obtain the appropriate Vision Super Product Disclosure Statements (PDS) and Target Market Determinations (TMD) available at www.visionsuper.com.au.