As the seasons change and the air fills with the promise of renewal, it's the perfect time to clean out your physical space, as well as your life and career.
Refresh Your Life and Retirement Planning This Spring
Spring cleaning isn't just about dusting shelves and organising files; it's about refreshing your mindset, optimising your processes, and ensuring that your personal and professional worlds are in top shape. Here are some ideas to help you revitalise your life as we move into the warmer months.
Declutter Your Physical and Digital Environments
Start with your physical workspace. Clear out the clutter that has accumulated over months of hard work. A tidy workspace improves productivity and clears mental clutter, allowing for better focus and creativity. Organise your files, shred unnecessary documents, and create a system that makes everything easily accessible.
Extend this decluttering to your digital life. Clean up your email inbox by unsubscribing from unnecessary emails and setting up rules to automatically organise emails into folders. Streamline your phone by deleting unused apps, grouping them by category, reviewing your contacts, and deleting old ones. Make sure everything you need is backed up properly.
Streamline Your Life and Get Organised
Next, it’s time to look at where you spend your time. Spring cleaning your life means being ruthless with your time management. It’s said that a small portion of our time and effort (20%) generates a significant part of our results (80%), so focus your efforts on those activities that yield the most effective outcomes. Evaluate your commitments and activities—are they genuinely adding value to your personal or professional growth? Learn to say no to tasks or obligations that don’t align with your goals or values. This will free up time for activities that truly matter.
Then, it’s time to get organised. Allocate time for the important stuff. Review your calendar and update it with both personal and professional commitments. Prioritise self-care and relaxation alongside business meetings and deadlines. This balance ensures you remain productive without burning out, and it’s vital to have time in your life for the things and people you care about.
Polish Your Skills and Connections Until They Shine
Investing in yourself is key to staying competitive. Commit to ongoing professional development by planning to attend workshops, webinars, or conferences relevant to your field. Consider what areas to work on and update your skills and knowledge to stay ahead of industry trends and innovations. This can be as easy as listening to a regular podcast on your commute.
Networking is also crucial. Refresh your professional network by reconnecting with contacts, attending industry events, and building new relationships. Your network can provide valuable support, advice, and growth opportunities.
Taking The First Step To Transformation
Spring cleaning your life is not just a seasonal chore; it’s a transformative process that sets the stage for success throughout the year. By decluttering your physical and digital spaces, streamlining your life, honing your work processes, and committing to ongoing growth, you set yourself up for greater productivity, efficiency, and personal fulfilment.
Take the first step today. Start small with one area— organising your desk or updating your LinkedIn profile. Each step, no matter how small, contributes to the bigger picture of a rejuvenated business and a balanced life.
Remember, spring cleaning is not just about tidying up— it’s about creating space for new opportunities, ideas, and experiences. Embrace this time of renewal and watch as your life flourishes.
How Do Retirement Income Options Compare?
Retirement is filled with opportunities and choices. There’s the time to travel, work on long-delayed personal projects, or volunteer your help for worthwhile causes.
You also have a host of choices to make when it comes to funding your new life away from paid work. Here are four different options to consider.(1)
Account-Based Pension
One of the most common retirement income options is an account-based pension (ABP) using your superannuation. The amount you receive depends on the balance of your account and the drawdown rate you choose, subject to the minimum pension requirements set by the government.
Some considerations:
Tax benefits – Investment earnings, capital gains and withdrawals are tax-free unless you have an untaxed component within your super.
Payment flexibility – Subject to pension minimums, most super funds allow you to adjust the payment amount and frequency and even make partial or full lump-sum withdrawals if needed. You can also return to work and continue to receive a pension.
Longevity and market risks – You might outlive your account balance, especially if your withdrawals are high or your investment returns are poor.
Transition to Retirement
A transition to retirement (TTR) strategy allows you to access some of your superannuation while still working if you have reached age 60 (based on current rules).(2)
Some considerations:
Flexible work options – You can reduce your working hours and supplement your income from your super.
Limits on pension rates – Similar to an ABP, there is a minimum annual pension rate. However, there is also a maximum annual withdrawal of 10% of your TTR account balance.
Reduced retirement savings – Drawing on your superannuation while still working means your retirement savings might grow more slowly.
Annuities
An annuity is a financial product that provides a guaranteed income for a specified period or the rest of your life. There are various types of annuities, including fixed, variable, and indexed. You can purchase annuities or lifetime income streams using your superannuation.
Some considerations:
Predictable income – Provides a stable income stream, which can be reassuring for financial stability and provide an income for as long as you live.
Lack of flexibility – Once you purchase an annuity, the terms are generally fixed, and you cannot alter the income amount. There’s a restriction on capital withdrawals or, in some instances, no access to capital at all.
Inflation risk – Fixed non-inflation-linked annuities may not keep pace with inflation unless specifically indexed to inflation.
Innovative Retirement Income Stream
An Innovative Retirement Income Stream (IRIS) is provided by a newer range of products. These were introduced after changes to regulations designed to deliver more certainty to retirement income by paying a pension for life without running out of funds.
Some considerations:
Age Pension benefits – Centrelink only counts 60 per cent of the pension payments received as assessable income and only 60 per cent of the purchase price of the product counts as an assessable asset until age 84 when it is reduced.
Certainty – Some IRIS products offer a stable guaranteed income stream, providing financial security.
No minimum requirements—IRIS products do not require an annual minimum amount; instead, they require at least one annual payment.
Complexity – Features vary widely between different IRIS products and may involve complex terms or conditions.
Next steps
How do these different options suit your needs, and how would they affect your retirement income?
Consulting with a financial advisor can help you navigate these choices and tailor a plan that best suits your needs. Speak to us so we can help you structure a plan to fund the retirement lifestyle you’ve worked so hard for.
https://www.ato.gov.au/individuals-and-families/jobs-and- employment-types/working-as-an-employee/leaving-the-workforce/ planning-to-retire#ato-Afteryouretire
https://www.ato.gov.au/individuals-and-families/jobs-and- employment-types/working-as-an-employee/leaving-the-workforce/ transition-to-retirement
When DIY Does Not Pay Off
“If you want something done right, you’ve got to do it yourself.”
The appeal of doing it yourself is understandable. A great feeling comes with doing something that challenges you, such as being resourceful and learning a new skill, but there are some pitfalls to DIY and benefits from getting an expert involved sometimes.
We tend to be proud of what we create and place greater value on things we have made ourselves. There is a statistical difference between the dollar value someone places on something that they have built and what another person would pay for it (this is, for good reason, known as the “Ikea effect,” as it even applies to putting together flat-pack furniture).
Making DIY Look Easy
With all the information we have at our fingertips, encouraged by the appeal of learning a new skill and guided by the power of Google and YouTube videos, we are encouraged to give things a go. Whether fixing that dripping tap, troubleshooting the laptop playing up or even investing your hard-earned dollars, DIY has never looked so easy.
The Growth in DIY
The DIY mindset is on the increase. When we think of DIY, we tend to think of home improvement. This market has increased by almost 10 million dollars in the last ten years. The statistics reveal more than half of us are taking up the tools, with 55 per cent of homeowners deciding to take on home improvement and repair jobs rather than seek professional help.(1)
DIY can be a lot more than just picking up a hammer, though, and our love of DIY also extends to our financials. In the wake of a global pandemic, the search for additional income has seen an increase in traders keen to take the reins and invest for themselves. Over the past decade, there has been a steady increase in the share of retail investors, with equity trades by retail investors nearly doubling the volume from a decade ago. Equally, when it comes to setting ourselves up for retirement, the number of people setting up self-managed super funds (SMSFs) continues to rise by around 9 per cent over the past five years.(2)
Reasons To Be Careful
There is a lot more to lose if there is a problem with your financial situation than a tap leaking, so it’s important to think about what is at stake when you manage any aspect of your financials.
The bottom line is you want to get the best outcomes, which only sometimes happens if you take a DIY approach. For example, when it comes to investing, several academic studies have shown that DIY investors tend to underperform and that underperformance ranges between 1% to 10% per year.(3)
Getting An Expert Involved
The trick with DIY is to do your research, understand the task and what’s involved, and acknowledge when you might benefit from a helping hand. There are times when it’s OK to have a go yourself and times when it makes more sense to leverage the skills of an expert. You can still learn and gain skills that you can apply to future situations, but it can make sense to maximise your efforts by leveraging the skills of the experts.
When it comes to your financial life, whether you’re investing and growing your wealth, protecting your wealth, retirement planning, or estate planning, there is a lot to know and consider, and consulting with an expert can add value and help you avoid potential pitfalls.
Getting help does not mean being passive and unengaged, though. The best outcomes are achieved when we work together to achieve your desired outcomes.
There is a world of difference between totally going it alone, floundering a little and getting advice and guidance to reach the best outcome. So, if you want something done right, sometimes it is best to call in the experts! We are here to help.
We hope you enjoyed reading our Spring edition of Prepare for Life. If you'd like to explore how these insights can enhance your financial future, get in touch with us today to start a conversation tailored to your needs.
This publication contains information and advice of a general nature only and does not consider your particular objectives, financial situation or needs. You should consider if it is appropriate for your situation before acting on it. You should obtain and consider the relevant Product Disclosure Statement (PDS) and consider seeking the assistance of an authorised financial adviser before making any decision regarding any products mentioned in this publication.
Prepare for Life is a publication of ClearView Financial Advice Pty Limited ABN 89 133 593 012, AFSL 331 367 a wholly owned subsidiaries of Centrepoint Alliance Ltd. The information is derived from sources believed to be accurate and current at the publication date and may be subject to change. While all care has been taken in the preparation of this publication, to the extent permitted by law, no warranty is given in respect of the information provided and accordingly, the licensee, its related entities, employees or representatives shall not be liable for any loss suffered arising from reliance on this information. Past performance is not a reliable indicator of future returns. Middleton Financial Planning Pty Ltd 89 133 593 012 is a Corporate Authorised Representative 450278 of ClearView Financial Advice Pty Limited ABN 89 133 593 012, AFSL 331 367.
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