Good to Great: How to Scale With an Outsourced CFO

Proper planning precedes success. For a sensational holiday, we book early, research entertainment options and coordinate schedules. A memorable birthday party follows careful planning, invitations and gift shopping. What about a successful retirement?

The retirement of your dreams doesn’t fall from the sky the day you reach your preservation age. It requires planning and thoughtful logistics. And when you use the following ten pillars of successful retirement planning, your golden years can unfold as seamlessly as your carefully planned holiday.

Let’s take a closer look at these planning pillars to set you on the right path.

 

1 - Envisioning the Future

The daily grind can be all-consuming. With endless to-do lists and so many people requesting your time, thinking about the future falls by the wayside.

Envisioning your future is more than just daydreaming, however; it gives you something to reach for. If you struggle to think about life after retirement, start by answering these questions:

• What kind of lifestyle do I want to live during my retirement years?
• What kinds of health concerns do I need to plan for?
• Do I have any dependents to care for during my retirement years?
• What kinds of assets do I have?
• Who will run my business after I retire?
• Where do I want to live?

 

2 - Goal Setting

Progress toward a successful retirement relies on the setting of actionable goals. A solid retirement plan includes both long- and short-term goals. Since your family and financial situation are unique, your goals may be different from your neighbour’s. Here are a few examples of retirement-focused financial goals:

• Pay off mortgage
• Eliminate consumer debt
• Salary sacrifice 10% to increase retirement savings
• Create a will
• Create a succession plan for your business

These are just a few of the goals that may help you to retire successfully. As you speak with your wealth adviser, you can create goals that are suited to your situation and experience a sense of peace and security as you secure your financial future.

 

3 - Writing Down Your Plan

Something changes when we pluck ideas out of our heads and write them down in black and white. The plan takes shape. It morphs into an actionable, tangible entity.

Retirement is very real, so it’s best to treat it as such. By documenting your plan, you’ll be able to return to it regularly and make adjustments as necessary. An annual review with your wealth adviser will help you to stay on track, and a record of your financial goals will help you navigate your journey to retirement.

 

4 - Taking Action

With a documented plan in place, you’re ready to take action. Some of the first steps in your retirement will be simple and straightforward. For example, if you’ve decided to increase your monthly retirement contributions, you may just need to meet with your Human Resources representative to arrange for salary sacrificing.

Other actions may be a bit more time-consuming and complicated. For example, if one of your goals is to create a succession plan for your business, you might want to consider hiring some outside help to achieve your goals.

 

5 - Protecting Your Assets

Retirement planning isn’t just about accumulating wealth for the future; it’s also about protecting your assets. Asset protection can take many forms, including the following:

• Insurance
• Tax reduction strategies
• Trusts
• Wills
• Income protection
• Business structure
• Superannuation

Speak with your wealth adviser about steps you can take to protect your assets, both now and into the future. You might be surprised at how many ways you can solidify your assets and protect them from various threats, ranging from this year’s taxes to family conflict during estate planning.

 

6 - Evaluating Taxation

One crucial component of retirement planning is minimising the taxes that you’ll pay both now and after you retire. Effective retirement strategies can help you get the most out of your assets.
Forgetting to account for taxes can be an expensive mistake; by combining retirement planning strategies to minimise your taxes, you could improve your lifestyle in the future.

 

7 - A Long-Term Approach

Some people try to time the market by only buying when stock prices drop and only selling at high points. This strategy rarely works for retirement planning for several key reasons.

First, emotional trading tends to hamper investor returns. Second, the main reason to buy and hold stocks for retirement is that long-term investments nearly always outperform the market when investors try to time their investments. Additionally, and perhaps most importantly, most people don’t have time to be involved daily in their retirement investments. You might experience bouts of high interest, but then you could forget to invest for months (or years) on end.

That’s why superannuation is such a powerful tool. With each paycheque, you add to your investments, automatically taking advantage of the inevitable dips in the market.

 

8 - Starting Early

Although it’s never too late to start planning for retirement, starting early is a pillar of successful planning. With years ahead of you for stocks to appreciate and interest to compound, today’s dollars have time to work their magic. We can advise you on places to invest that help you to achieve your personal retirement goals.

 

9. Timing Your Retirement

Some people burn out early at the end of a long career. Others love their work and keep working (at least part-time) forever. Still others start new businesses or develop new skills toward the end of their working lives.

The timing of your retirement is another essential pillar of your plan. You may feel tempted to retire earlier than initially planned. However, those last few years of steady income can prove to be extremely important. You’ll probably be at the peak of your earning power, and you may need those last few contributions to your superannuation.

On the other hand, your investments may perform better than anticipated, and you could have the ability to retire early. The key is to make timing decisions carefully, not hastily, and to consider the long-term implications of your retirement.

 

10. Using an Adviser

Whether you’re embarking on your career or counting the months to retirement, you can benefit from the services of a qualified wealth adviser. While there are treasure troves of information on the internet for DIY retirement planners, it can be immeasurably helpful to have an experienced adviser guiding you through your retirement planning process and helping you to achieve your goals.

Using a retirement planning adviser has several benefits, including:

• helping you plan more effectively
• staying up-to-date on tax and regulatory changes
• helping you stay focused on the long term and your goals
• filtering out the noise and cutting through the information to make it work for your goals
• making the complex simple
• standing between you and emotional decisions
• helping to create a customised, comprehensive roadmap for your retirement

To learn more about successful retirement planning, or to speak with one of our wealth advisers, get in touch with us at Altus. We look forward to helping you make the most of your retirement.