Your retirement dream may be lavish, or it could be to simply not worry about money. But one thing remains the same – when you plan to retire will often be determined by whether you can afford to stop working and still have enough income to maintain your lifestyle. Figures from the Australian Bureau of Statistics (ABS) show that the main reason people retire is because they have have become eligible to draw on their super and/or the age pension (36% of men and 22% of women). And their average age at retirement is 63.5 years.i

However, these stats haven’t stopped Aussies from dreaming about an early retirement. In fact, an early retirement has become a popular financial goal for Australians from a wide variety of different backgrounds and circumstances. A global study found that out of 17 countries surveyed, Australia has one of the highest proportion of people wanting to retire early. A staggering 75% of Aussies aged 45+ wanted to retire within the next five years – as much as fifteen years before pension age.ii

There’s no question that starting your retirement early means you have more time and energy to enjoy it. Unfortunately, there’s a big disconnect between the dream of an early retirement, and the reality of finances that won’t allow Aussies to stop work.


What do early retirees have in common?

Those who have successfully retired early aren’t just lucky, or from wealthy backgrounds. Research suggests that early retirees fostered habits and abilities that allowed them to build their wealth sustainably over time.iii

The first is the mindset and discipline necessary for saving. Consistently choosing to save rather than spend – plus compound interest – means real wealth is built over decades.

Speaking of decades, early retirees are more likely to have set long-term goals and focused on them. There’s a psychological reason that this is difficult for many people. Our brains are hardwired for instant gratification and it doesn’t just affect our propensity to snack or hit the sales. Anything we can see, or at least visualise strongly, is much more attractive than anything that’s too far in the future to picture.

Of course, good habits in both of these areas are less effective if they’re not shared by your spouse. A spender can undo much of the good work of a saver, even if their finances are not completely intertwined. So it’s important you speak to your partner about your expectations, future plans and the lifestyle you are hoping to achieve in retirement.


How to work towards a comfortable early retirement

Do you want to retire with enough time to enjoy your golden years? There are plenty of ways you can start building towards an early retirement.


1. Make a plan

Your plan should be holistic and consider all your circumstances, including children and grandchildren, and spending changes in retirement. Of course, help from a financial professional can also make this planning process much easier! Get in touch with us so we can start mapping out a plan that’s right for you.


2. Consider your savings

How much income will your retirement savings provide you with? All the superannuation you’ve accumulated so far can look like a pretty impressive number, but bear in mind that the average Australian needs to live on their super for 15 years or more. 

The Association of Superannuation Funds of Australia (AFSA) have come up with two estimates for how much income you may need to live on during retirement – a higher amount for a comfortable lifestyle and a lower amount for a modest lifestyle. A single person aged around 65 years who is aiming for a comfortable lifestyle will spend approximately $43,317 in a year, while the annual budget for a modest lifestyle is around $27,648. The annual estimate for couples is $60,977 for a comfortable lifestyle, and $39,775 for a modest lifestyle. For more information on the ASFA’s Retirement Standard benchmarks, you can visit their website here. Keep in mind that these estimates don’t take into account your personal circumstances, and that everyone’s needs and expectations are unique.


3. Establish goals

If you’re one of the aforementioned ‘instant gratification’ types, try breaking down your savings and investment goals into bite-sized pieces. Instead of looking at one benchmark (which may be in the millions of dollars), look at multiple small goals and ascribe them labels. For example, call your first chunk of retirement savings your ‘renovate/move house fund’. Nickname your salary sacrifice ‘retirement travel fund’. Feeling like you’ve achieved goals will help keep you on track.


4. Invest wisely

Don’t allow your investment decisions to be driven by trends. Get to know your own risk appetite and tolerance. And always make sure that any individual investment is right for your personal circumstances and life stage.


5. Manage your debt

It’s not fun or glamorous, but paying off debt should be a top priority. Every time you divert a dollar from paying off debt, you’re effectively charging yourself interest that you’ll have to deal with later in life. It’s harsh, but you won’t be able to retire comfortably whilst still making debt payments.


6. Set up multiple income streams

It’s important to consider possibilities and entitlements beyond your super, such as government benefits. By starting early, you may also be able to build other income sources such as cash-positive property or a share portfolio.


Need some help kick starting your dream of early retirement? Get in touch with us on 1300 850 757 or email us at to see how we can help turn your dream into a reality.


i Australian Bureau of Statistics, 6238.0 – Retirement and Retirement Intentions, Australia, July 2016 to June 2017

ii HSBC, 2016, Nearly half of Australians who want to retire can’t, HSBC research.

ii Allianz. Workers Ready for Early Retirement Come From Ordinary Means.


The information and any advice in this article does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. When considering whether to acquire a financial product, before making any decision, you should obtain the relevant product disclosure statement.