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Why we don't plan for our retirement!

Written on the 2 May 2011 by James Cagney

Why we don't plan for our retirement!

Who has the time today to plan for their future? We are all so busy these days we can hardly find the time to plan for today and tomorrow - never mind next week; next month or our eventual retirement.  How on Earth did we get so busy? Personal computers, mobile phones, i-pads and all the marvels brought with them like the Internet, Skype, Facebook etc were supposed to make our lives easier! Who amongst us feels they have more leisure time on their hands now than they did last year? We have all of these devices at our disposal, theoretically in existence to save us time and effort - but somehow life has become more hectic? With the amount of information that is thrown at us through print, radio, on-line and television marketing, we are simply reeling under the pressure. We have so much choice and SO many decisions to make every day that it is becoming harder and harder to make even the most simple decision without cause for deep consideration - "Perhaps there is another way I can achieve this?" Think back to how easy it was to go and buy bread and milk 10 years ago. Today we have dozens of types of bread and milk to choice from that even that decision takes time and effort to make. When did milk suddenly get "smart" and bread make us "slim?' Certainly none of the bread I've been eating (just ask my wife)

The reason it is so difficult to plan for retirement is that most people are better at remembering the past than they are at visualising the future. Can you remember the night of your 'formal', your first date, your 21st birthday, your wedding, the birth of your children? These images come flooding into our minds without even trying. Now try and visualise yourself 20 years from now. What will your life be like? What will you be doing? Will you be enjoying your golden years? Who can foresee the future?
It may or may not surprise you to learn that 90% of Australians live on $25 000 per year or less in their retirement today. Superannuation Fund Administrators advised us that people retiring today have under just under $100 000 on average in their Super. This is woefully inadequate and will last them just four years at a paltry annual income of          $25 000. Imagine the difficulties of trying to survive on that meager amount today?  Well the experts tell us we are going to need 65% of our last years income indexed to inflation just to keep your lifestyle of today. The latest Westpac ASFA Retirement Standard say a couple retirement need $53 729 to live comfortably. Many super funds and financial advisers say $750 000 to $1 million is required to fund a modest or comfortable lifestyle in retirement.  

Some may say well I won't have a mortgage or kids we may be able to survive on a lot less. Wrong! Think about it - this year the first of the 5.3 million in the baby-boomer generation in Australia turn 65.  the government has not a hope in hell of maintaining the Medicare system as it is now in 20 years time.  With one third of our population retired by 2036 how on earth are they going to find the money to to this?  We are all living longer these days. The average mortality age for women today is 87 years and men 82 year old. It is estimated that 1 in 4 of our kids today will live to 100 years old. Future governments will have to keep them alive for 35 years after retirement. How can they afford this? How much tax can you charge future generations to pay your medical bills?  Denmark has since the end of  World War II been diligent in it's social welfare program and the average Dane pays on average 48% tax and a top rate of 75%. And they now admit that they don't have enough money for their retirees. What is Australia going to do about our 5.3 million?

Besides all this - money devalues by half every twenty years so if you think you can retire on even $50 000, which will only be worth $25 000 in twenty years time you're mistaken. The joke is that the government brags that they increase the pension amount annually at the official inflation rate.  We all know that utilities, food, petrol and the cost of living is increasing at a percentage rate far higher than the published inflation rate. So what will happen to these battlers? It is not that they did not want to think about their future - the future was too horrible and depressing to think about so they all just go on with their daily lives hoping for the best. The notion "it'll will be right mate, the government will look after me" was a much nicer thought to go to sleep to every night.  And now these people will have to depend on the Government  pension since the meager superannuation they had is long-gone and they find themselves living on the breadline, reliant on their children for support and security. How can a person live on this amount of money and retain any sense of dignity?  While money will not make you happy - hands up all those who would like to find that out for themselves? Remember we don't plan to fail we just fail to plan. So many of us will be moving in with our children during retirement. How pleasant is that going to be - not only for us but what about them? Who wants to be a burden on their children.

Of course, politicians needn't worry - they're on an entirely different pension scheme - one that amasses them 80% of their final year's pay packet  prior to their retirement. And is also generous enough to be indexed to inflation, to boot. No wonder the government spends our tax money so freely because they will all certainly "be right mate". We voted these bureaucrats into power and allow them to make decisions about OUR future, knowing any decisions they make will never serve to adversely affect them personally. What were we thinking voting these self-serving bureaucrats into power?

But back to the pressing question - How have you prepared for your future? You cannot rely solely on your Superannuation or pension. Since the introduction of mandatory superannuation in 1992, the laws governing "super" have changed over 2,500 times. Do you think the politicians will be able to keep their grubby little paws off the trillions of dollars we have in super funds for very much longer? They will find a way to borrow, redistribute or re-appropriate this. For example, what's preventing them from heavily taxing the superannuation you draw out in the future? That way they can equalise the 'haves' and the 'have nots.'  After all we are an egalitarian society where we should be all equal!  Well, I for one say: "No!" These politicians have forgotten that we have a God-given right to become unequal. If we work hard and invest well - why should we give it away to those who have bludged off the government throughout their "working" lives - and now come back for another hand-out in their golden years which we must pay for once again.

The best way to avoid becoming independently wealthy is to to invest in income-generating assets, where the tenant and the taxman pay for most of the outgoings. There is no better or safer investment than property in Australia. So find out where you stand financially right now, so we can help you plan for YOUR future. Before you know which direction to go you need to know where you stand now. Click >>>> here right now and I will arrange a Financial Assessment worth $500 absolutely FREE. The multi-millionaire John D Rockerfeller said " If you want to become wealthy .... you must make money work for you. The amount you get paid for your personal effort is relatively small compared with the amount you can earn by having your money make money" . So do it NOW - send off for your FREE Financial Assessment today by clicking >>> here . After all we all have the choice - make a change on purpose or let change control you.

Author: James Cagney
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