Ways to make up dollars as you get closer to retirement

There is often a balance in this age bracket between pausing on what you have already built, in terms of superannuation and investments, until you have excess income again versus those who now have an empty nest and the opportunity to focus on doing more while they can.

Review all five financial foundations for relevance and appropriateness now. What life events impact you now? Do you have more disposable income now, or less than say, ten years ago?

Depending on your family situation, some of the strategies for twenties and thirties may still be relevant for you. Yet you may also feel you’re running out of time to work and invest! Technically, you’re still of an age to build your superannuation and probably have good reason to want to build it up, given gender pay gap implications and time out of the workforce in family caring roles. It’s always a joy to help women in this phase of life make a difference. It can be done.

Don’t put your head in the sand. The sooner you move to get personal advice and implement what is right for you, the bigger impact you can have on your long-term outcome.

Maybe you want to start some conversations around:

• Any residual mortgage on your home – what is the best strategy regarding that?
• Are your personal insurance policies still appropriate for you? Insurance costs can creep up significantly during your forties and fifties. If you have less mortgage debt and independent kids, you may not need the same level of life insurance or TPD.Does your emergency fund still reflect your comfort level?
• What’s your debt on investment property? Is it time to consider paying down or stick to ‘interest only’?
• Superannuation. Look at fees, how the money is invested and what insurance is inside the super. Are these working for you now? How risky are these investments? If you can’t touch your super for some time, can you be a little more aggressive with superannuation than you are with investments in your own name?
• If you are over 55, is it worth exploring the transition to retirement (TTR) strategy which can be used to boost your superannuation balance before you retire or to top up your income as you ease back on the hours you work?
• Can you – should you – invest more? If everything you earn is “all yours” (no KIPPERS: Kids in Parents’ Pockets Eroding Retirement Savings!), this is time to put your skates on and maximise the income you have left. Are investments you have, outside of superannuation, right for you? How risky are your investments? Have you overstretched yourself? Do you need to sell them? Does it make sense to sell them? Or can they keep working for you providing you with income and capital growth over time? Do you need to change how you are invested?

This is likely to be a time in your life when investments are working fairly hard for you, with more exposure to growth than defensive investments to benefit from the compounding effect of growth, but outside of superannuation, that may not be the right mix for you because you may want to access some of it.

If you are feeling that it’s too late, you’d be surprised what can be achieved with great advice, direction, focus and more importantly action.

This is an edited extract from On Your Own Two Feet by financial advisor Helen Baker and was originally published in Over Sixty.