Retiree living costs decline

[Ridin-High]

According to this article posted on the morningstar Australia Website

http://www.morningstar.com.au/article/inv/retiree-living-costs-decline/10288

Mentions in the article that

"The benchmark findings indicated that a couple looking to achieve a comfortable retirement need to spend $53,456 a year, while those seeking a modest retirement lifestyle need to spend $30,382 a year."

Whats peoples thoughts on this, i'm planning what sort of income that i need to retire. $1000 per week sounds good, would allow me to do some travelling etc (Im single)

So yeah the above figure for a couple to retire, put it up for dicussion

Regards,

RH

 

[Propertunity]

.... a couple looking to achieve a comfortable retirement need to spend $53,456 a year,

You can't even buy a half decent car for that much and you need one of those every 4 -5 years.......and personally I'm not the Corolla driving type of retiree

Maybe if you retired to Thailand and had meals for $AU2 each??

I think I'd be aiming for $150K pa minimum for a 'modest' retirement.

 

[Ridin-High]

You can't even buy a half decent car for that much and you need one of those every 4 -5 years.......and personally I'm not the Corolla driving type of retiree

Maybe if you retired to Thailand and had meals for $AU2 each??

I think I'd be aiming for $150K pa minimum for a 'modest' retirement.

well im a nissan pulsar 2004 driving type guy lol, so in the same ball park.

I think this report makes the assumption that the person owns their PPOR outright as well.

Im also thinking this is an after tax income, so probably mroe around the 70k before tax mark.

I think 1k per week is decent considering no mortgage payments

 

[Dazz]

I think I'd be aiming for $150K pa minimum for a 'modest' retirement.

Data from Centrelink website....


The maximum Age Pension fortnightly amounts are currently:

Single: $701.10*
Couple combined: $1057.00*
Couple one eligible partner: $528.50*

*Includes maximum Pension Supplement payable
---------------------


So Propertunity....Your definition of a "modest" retirement income is roughly 6 times that for a couple on the pension. Do you really think 6x what the majority of elderly couples are on is modest ??

 

[csc2]

WOW Prop, your way ahead of me with your $150k a year............I could easily live on a third of that a year no dramas and still be very comfortable..especially being out of all debt

You must be wanting servants surely??

Clap Clap!!.............Wipers!!

 

[Shaneelastic]

45K for a single would be good.
60K for a couple would be about my thinking for my lifestyle.
structured correctly youd pay no tax

when i started working i was on about 50k and have managed mortgages, cars and about 3 holidays per year since then, so i think that 50K ball park figure is ok, depending on your lifestyle though.
Mind you, im the sort of person who picks up those dirt cheap fares to malaysia for $90 and stay in 3 star hotels,

 

[Propertunity]

So Propertunity....Your definition of a "modest" retirement income is roughly 6 times that for a couple on the pension.

Yes, that would be my definition. I have no idea why anyone would want to aspire to retiring on $500pw.

Data from Centrelink website....

Yikes!! I would not be taking much advice from these people - sounds like a recipe to end up broke and poor.

Of course if is a very personal perception thing. We live in one of the greatest countries in the world. There are almost unlimited (legal) ways to make wealth. I don't think anyone is doing themselves or others any favours by 'shrinking back' to live on a 'modest' income....but that's just my personal view and I respect that others hold different views

Do you really think 6x what the majority of elderly couples are on is modest ??

No I think it would be borderliine poverty, but I could scape by on it if absolutley necessary

 

[Propertunity]

Clap Clap!!.............Wipers!!

Absolutely, I think that and the other one (the royal .......is now clean) were 2 of the funniest lines in Coming to America.

 

[Paul Do]

For many people, retirement living costs don't include rent or mortgage interest.

The kids have moved out.

You also don't have any super contributions to make and no/(lower equivalent) work costs - transportation, work clothes, coffees etc.

And lower income equals lower/no tax to pay.

 

[VYBerlinaV8]

I think I'd be aiming for $150K pa minimum for a 'modest' retirement.

I'm aiming for $150k per year in 2005 dollar terms, with PPOR owned outright. I think that will be an extremely comfortable retirement.

I'll split that income with the wife, and use some other strategies to reduce tax a bit. That will give me enough for 2 modern (but regular) cars, overseas travel every year, and basically doing what I want when I want.

 

[Sunfish]

To achieve $150k PA passive income in today's climate would not be easy and, in spite of your current feeling, is not necessary. If invested in res property you would need over 30 fully paid off houses and that doesn't sound like "retirement" to me.

If you are doing a "planned" retirement (not one forced upon you) you will, by definition, already own your own home, car(s), boat, golf clubs/membership etc. You no longer need to be tithing into investment. Once you settle you will come to appreciate the simpler life and any grand-kids. Trading your perfectly good three yr old low milage car just won't seem worth the time and effort.

What if you plan two different nest eggs? One the "bucket" and the other the endowment.

The bucket funds the Winnibago and the year long trip around the country and a trip o/s the year after or whatever your own (reasonable) bucket list includes.

Once you've scratched this itch you will most likely find your requirements are less than half you speak of.

Besides, if you really love international travel that much, why wait? If you are earning enough to provide such a high retirement income, you are earning enough to take a few trips while still young and healthy.

 

[virgo]

Retirement costs

Hiya

Pah! Humbug! Not for me retiring in Australia playing lawn bowls!

Has anyone of you considered spending part of your retirement overseas? In Asia (think Indonesia, Malaysia etc), one only needs a fraction of your present retirement dollars needed to live (and have a good time!) Google Golden Passport Malaysia....

I encourage you to spread your wings and think beyond Aussie shores....you'll be pleasantly surprised; hubby and i plan to spend 6 months every year in Singapore (where we have family), Indonesia and China once the kids fly the roost.
And we are not the only ones; i know another Aussie family who has bought land in Lombok and going to live there part time once they retire.
By the time we retire (15-20 years time); i reckon the world will be a much smaller place; we are planning to be global citizens....

We are thinking of maybe getting a post retirement part time job (eg teaching ESL) and travelling, living and experiencing the local culture. Now, that is what i called LIVING!

Cheers

 

[redwing]

According to this article posted on the morningstar Australia Website

http://www.morningstar.com.au/article/inv/retiree-living-costs-decline/10288

Mentions in the article that

"The benchmark findings indicated that a couple looking to achieve a comfortable retirement need to spend $53,456 a year, while those seeking a modest retirement lifestyle need to spend $30,382 a year."

Whats peoples thoughts on this, i'm planning what sort of income that i need to retire. $1000 per week sounds good, would allow me to do some travelling etc (Im single)

So yeah the above figure for a couple to retire, put it up for dicussion

Regards,

RH

Still a lot more than the Age Pension as mentioned in the Unretired Thread

Your Goal is $52k at todays dollars, by what date and on what asset base and return RH?

 

[kathryn d]

Being newly retired with Rob (almostBob), I can share a tiny bit.
We already have a house and car in Canada, so we do not consider that.We also do not consider our price for the flights to and from Australia.
We have rented out our home to a college student while we are away.

We have budgeted $1000 month while in Australia.(for 2)
With this we pay for our internal flights, trains, taxis etc to get from house sit to another.
We do not need to pay for any bills or accommodations while here, as they are taken care of while we house sit.
So far, we have been provided the use of a vehicle by the homeowners, and just pay for the petrol we use.
If internet is not provided, we find the local internet hot spot, and sit there for an hour or so. We receive our emails. Go home, answer them, and send them on our next visit to the hotspot.
We still try to buy lots of fruit and vegetables, have meat everday in at least one of our meals.Happy to see reduced food is available here too !!

We have our chores to do, which generally take 1/2 hour per day, to satisfy our house sittering obligation.
Most people just want someone to feed their pets. Cuddles are free, and continuous all the time we are here.

So yes, if we were truly living in one spot all the time, it would cost us at least twice this amount.
For now..this is good for us.

 

[our obsession]

I think Virgo and Kathryn's posts highlight the different ways of going about 'how-they-see-themselves' retiring,-> (is there another better word for this?) into the future.

Financial independence does not necessarily 'need' a quantitive measurement as such, it's more about the individual, to someone 'retiring' on $50,000 is generous, to another it obviously wont be enough.

For me, I don't envisage ceasing at the property game at all, winding down a little maybe, but I love all this stuff, if I still feel like this at 90yo I hope I'm still playing, I already 'lead' the life I want, the things that are (nitty gritty) dear and important to me are not dependent upon finance or cost analysis.

I do know I will not be necessarily doing the same thing over and over again, I am diversifying, but generally speaking, deals and investing are fun.

I see something along some time spent in Oz, sometime spent overseas, (which I have done anyway), so it's not like I've ever forced myself to do anything I don't want, to achieve [insert whatever here-'gently'].

I totally get for some they want first class travel, 5 star hotels, all that, I think that is fantastic, that keeps people in business and jobs and is good for places/economies, but I'm not prepared to quantify a latter years life in a figure, I find it nigh on impossible for my brain to try to do. For me life is a wholistic measurement. Income a small part of that. I love Virgo's and Kathryn's creativeness, Kathryn's just doing it. It sounds a lot of fun.

 

[MichaelW]

To achieve $150k PA passive income in today's climate would not be easy and, in spite of your current feeling, is not necessary. If invested in res property you would need over 30 fully paid off houses and that doesn't sound like "retirement" to me.

Thommo, no way known you'd need 30 paid off properties. My 3 paid off units in Mona Vale would provide me that income. They'll rent for about $1,000pw each. So, that's $156K gross pa from three IPs paid off. Sure there will be some outgoings, but my income would still be around that $140K odd mark pa. Would be a nice quality of retirement. That and a paid off PPOR in Toowong would be a pretty good setup. But that's too long a delay for me, I've got more meagre plans...

At the end of my build I'll have 4 properties on the beaches worth about $1M each and $2M odd debt round numbers. My actual plan is to sell two and buy a new PPOR in Toowong. I'll still have two IPs in Sydney renting for $100K odd a year and about $1M in debt against them with a paid off PPOR in Toowong. When that $1M is paid down I can then retire in a paid off PPOR with $100K pa passive income-ish. All round figures but it will do for now. Our total income would be $400K odd pa while we pay down the debt based on $100K passive and $300K salaried between my wife and I. We should be able to knock $100K pa off that $1M debt and retire in 10 years, maybe sooner. I'm 40, so retire at 50 sounds nice...

Hiya

Pah! Humbug! Not for me retiring in Australia playing lawn bowls!

Has anyone of you considered spending part of your retirement overseas? In Asia (think Indonesia, Malaysia etc), one only needs a fraction of your present retirement dollars needed to live (and have a good time!) Google Golden Passport Malaysia....

Virgo,

You bet! I've definately looked into the Golden Passport and we're actually thinking about buying a cruising yacht initially for around $100K and sailing around for a few years. When you sail, your living costs reduce to around $30K pa from all sources I've read. And in this time I could rent my PPOR for another $50K pa passive income so it would cover all my living costs by itself. The extra $100K debt for the yacht would only add $8K pa to my interest expense and still be covered by my PPOR rental.

There's lots of ways to skin this retirement cat.

Cheers,
Michael

 

[VYBerlinaV8]

To achieve $150k PA passive income in today's climate would not be easy and, in spite of your current feeling, is not necessary. If invested in res property you would need over 30 fully paid off houses and that doesn't sound like "retirement" to me.

30 fully paid of houses? At even 300 a week that's net rent of nearly half a million a year!

I figure on having 8 fully paid IPs, plus a solid shares portfolio, plus some cash.

 

[Andrew_A]

Personally I found that focusing on an end goal is only good in that it helps you start with a process, one step after the first until you have walked some distance instead of standing still!

The idea of X$ a year passive income by 2020 is really a world away if you are starting with a low asset base. If you can just begin to cover your costs, eliminate unproductive debt and generate any passive income via investments then that's a huge difference from living pay slip to pay slip.

Instead of using pensioners incomes as a benchmark I like looking at average earnings and the salary of a school teacher which will likely keep up their purchasing power much better.

 

[Intrinsic_Value]

I think I'd be aiming for $150K pa minimum for a 'modest' retirement.

$500,000 p.a in passive income, thats the target, retirement just occurs when i get there (and will probably last around 12 months before i get bored out of my mind).

As for being 'modest' no thanks i will pass, scrounging around on a tight budget is not my idea of an enjoyable retirement.

Besides i am very much enjoying the journey now.

 

[softmonkey]

$52k pa for a couple sounds reasonable to me, assuming PPOR & vehicles paid off.

Current CC outgoings are creeping up on $40k pa and thats including IP expenses, which I really should get another CC for because they're messing up what is otherwise a very handy cost-of-living gauge.