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Welcome to Super Simple Chats. Rest's very own podcast. We will be speaking to industry experts about all things super. Trying to make it understandable and relatable for everyday Aussies. After all, it's one of the biggest assets you'll ever have.

We're recording this podcast on Gadigal land. We pay our respects to elders past and present.

Any advice you hear on this podcast is general in nature and doesn't take into account your financial situation, needs or objectives. Issued by Retail Employees Superannuation PTY LTD. Before deciding to join or stay, consider the relevant PDS and TMD at rest.com.au/pds.

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Kate

Before we started this episode, we undertook some research.

Kerry

We did.

Kate

And we spoke to everyday Australians around, what does retirement look like for them?

One of those was a gentleman who is still working full time, and he wants to transition to retirement, but only for the purpose of fishing all day long and having coffee with his friends. Then we had another lady who we spoke to and she's retired, she's full time retired now, and her plan is to have all her time with her fur babies and to catch up with friends for coffee and walks.

Then we had our third person we spoke to, and this one was a little bit different, and it was more around doing a slow intro into retirement where she's working three days and then she's got the two days off and she gets to enjoy doing things like art classes and going to ceramics. And so a very different way to think about retirement.

So then Kerry and I spoke about that and realized just how different everyone is in how they're thinking about retirement and what they want for their retirement. But one thing was clear is, it's really hard to find a way through it or a way to understand what are the steps I need to take to even be thinking about any of those options that I have available to transition to work full time, to do it part time, to fully retire.

And so that's what we'd like to cover and talk to you today about.

Kerry

We're going to break down how to plan for retirement into three simple steps. One, we're going to visualize and plan for your retirement. Two, we're going to figure out your budget and spending. And three, we're gonna look at some smart tips to help you get ahead with your balance.

Kate

And we’re going to do it all with the help of one of our experts here at Rest.

Pete, welcome to the podcast. Thanks for joining us.

Pete

Thank you Kate. Thanks, Kerry. It's great to be here.

Kerry

So let's start with step one, Pete. So visualizing and planning your retirement. Like, I have to admit, like it's really hard to know what retirement is going to look like.

What's your tips on, I guess getting started with that.

Pete

I guess if I can start off with, one of my favourite quotes when I talk about this, that.. that hope is not a plan. Okay.

Kerry

I love that.

Pete

I do too. It's one of those things that, you know, a lot of us, sort of… hope’s great, but it's not a plan. So I guess the best place to start, Kerry, is timing. Alright. So thinking about when do you want to start your transition to life after work?

You know, from your current work life and the pace of it's at when do you want to start moving to something slower? When do you want to start downshifting as is becoming a bit more of a a common term in your in your work life. And at what age will you start that. So that's a, that's a very big question because once you've identified that age you can then work back from there, to see how long you've got before that that transition period starts and you start to put some structure around it all.

So I think I think many will agree that, you know, if we want to do some things, we've really got to be intentional about it. And make sure that we, we get to do the things that we want to do. And without intention, hope just might not get us there.

Kerry

I love that, I love downshifting.

Kate

I was going to say the same thing!

Kerry

I’ve heard of downsizing, but not downshifting. Is that that, sounds like it's more related to to work, is it?

Pete

I'd love I'd love to claim it is my own… little piece of terminology, but I confess I'm a bit of a avid podcast listener. And there's some other fantastic podcasts around, and that's one of the, one of the terms that's being being used at the moment.

Kate

So you’re living your dream today, Pete, living your dream.

Pete

I am living my dream.

Kerry

So Pete, how do we know when we can retire? Like, how do we find that magic number?

Kate

Great question.

Pete

Great question. Yeah, exactly. And that number is going to be different for everyone. So there's no one magic number different for everyone. So some people love their jobs, and will stay and keep doing that for as long as they can.

Kerry

That's us. Because, you know, we know our boss is watching so yeah.

Pete

I guess I better say the same thing. But they do. It's, which is a great thing if you enjoy you enjoy your job, you want to keep doing for as long as possible and get paid for it. Why not?

And people keep doing that in that situation until they feel that the time is right to move to something else or move to live after work. But we have to remember that the for many people out there who are in physical roles, they may need to retire earlier and the body may be telling them, hey, it's time. They need to plan for an earlier retirement than some others.

So once you have an idea of when your life after work will start, you can then go through and perhaps work out how long it may last.

Pete

So, you know, many might have 20 to 30 years in a life after work. It's a long time.

Kerry

A long time to keep you money lasting that long, isn't it?

Pete

Quite right.

Kate

How do I start to get a sense of how much money I'm actually going to need when I retire?

Pete

Okay. Well, firstly, you've… you've probably got to understand what you want to do, what your lifestyle is going to be like in your life after work. Because let's be honest, you've got to pay for it. Okay. So the first thing I would suggest, and the first thing I'd love you to once again give me your thoughts on is what are your work day day dreams?

So, you know, think about Wednesday afternoon. You've got, you've got a couple of maybe a paper to write, maybe some phone calls to make, maybe some tasks to do that might not be at the top of the list of things that you want to do. And you, as we do, we sometimes drift off and think about other things we'd rather be doing somewhere else and and doing that thing that we, we might daydream about doing.

So what are those things for you? Pickleball?

Kerry

Definitely pickleball. Yeah. You know, I'm mad into pickleball. So that is where I would, I would start. I don't think I can earn money from pickleball, so I'll have to try and see how I downshift to accommodate for that I guess.

Pete

Put ‘yet’ after that, Kerri, who is, you know, who knows, it might be an Olympic sport. You guys got plenty of time for it to qualify. What about you, Kate?

Kate

I wish this wasn't my response, but it is. It's the first thing that came to mind. I would just love chat, drink coffee by myself. For like, weeks on end if I could and just have time to myself. Just because life is really hectic at the moment, and one of the things I love the most is just reading and having coffee. It's pretty simple for me. It's usually alone time when I'm in my day dreaming at work. It’s definitely not pickleball.

Pete

And that tells us that, you know it's going to be different for everybody, right? So very, very rare that it's going to be same for for two people in a row.

So, you know, the next thing I guess I'd suggest is write these things down, start your: life-after-work list, so, you know, I'm a little bit ahead of you guys. You probably don't believe that, but it's true. A little bit closer to retirement.

Kate

We don’t believe it.

Pete

Thank you, I love you. Thank you very much. But, you know, imagine a list of things that you'll fill your life with after your full time working careers, if you start that list now.

Kerry

And that's really interesting, cause I remember when my dad, you know, started retiring and, you know, he he left his job thinking he'd be able to get another one. And that didn't happen so quick. And I guess then he had to transition pretty quickly. But you know, he was doing things like volunteering to try and fill that gap of work that he had at the time.

He was trying to do social clubs to try and, you know, meet people and network and do things like that. So, there's different things that you can start thinking about what you might be doing. I guess, yeah. Looking to perhaps what your parents did or what other, you know, friends, you know, thinking that they might like to do it. It's all different for everyone.

Pete

It is all different for everybody. I've got a great role model for a time in my life. My father in law, he's been a volunteer back in Adelaide, at one of the museums in Adelaide for over 20 years. And he loves it. Absolutely loves it. And it really feels his cub. Yeah. You know, he really gets a buzz out of it and has been has been great.

So you know it's it is different for everybody. Volunteering might be your bag. It might not be. And that's fine too. But you're alone time just like you said Kate. It's all fine. But it's really good to start to visualise these things. Let's let's bring them into the real world by writing them down. So if you think about your fridge, front of your fridge, put it, you've got your shopping list on there. You might have bills stuck there. Hopefully not. But put your life after work list on there and start filling it.

Kerry

You might have grandkids by then, Kate.

Kate

Maybe. Maybe, Kerry.

Kerry

Is that scary to think about?

Kate

Yes, yes it is.

Pete

So it's great that both of you have started to think about what you want to do. Now it's, it's probably time to start thinking about of where the income is going to come from. So you've got to figure that out.

So that'll really help you have a clear, a clearer understanding, I suppose, of how you're going to fund this lifestyle. Okay. And I understand we've got another session, retirement income session, which we'll talk more about that in detail. So, yeah, stay tuned for that one.

Kerry

Yeah. Excellent.

Pete

So one of one last thing I'd like you to consider when you're preparing for, when you're thinking about preparing for life after work is to how your lifestyle might change during that period of life after work. So the things that we we might experience in our, you know, late 50s, 60s, maybe early to mid 70s, they’re perhaps going to be a little bit different from what we experience and what life looks like in our late 70s, 80s and beyond.

You know, things like travel, sport and hobbies. You know, it may they may not, but they may become a little bit more challenging as time goes on. So it's really, it's really important to understand sort of what our spending patterns might be when our lifestyle changes further on down the track. Whether we're spending as much, you know, in those later years as we did in the early years of our retirement. So, you know, giving a bit of bit of thought to that as well is really important.

Kerry

And what we do might change as well. Like, hey, your kids might be grown up, you might have grandbabies by that stage. You could be, you know, your life could look a little bit different to what it does now in terms of how you spending your time and what you're spending money on.

Kate

I certainly hope so. I think that, yes, I it's it's interesting actually, when you were talking about that, it's easy to forget when we getting older that things do start to change and the things that we're doing today are not the same things that we necessarily carry forward. And what we value spending time on actually changes as well.

And so that was really interesting for me, the way you said that then around thinking through that part of retirement, which is what you value and where you want to spend time, also should be considered when thinking about what income and budget you needed, rather than just the things.

Kate

We went out and asked everyday Aussies what they knew about retirement.

Sinem

Have you thought about retirement?

Person 1

No.

Person 2

I think about that a lot. What am I going to do when I'm done... Working.

Person 3

I actually haven't thought about it. I just I don't know how the whole process works.

Person 4

I think maybe we’re kind of young.

Sinem

When would you like to stop working? Like when are you like, I'm done, I want to retire.

Person 2

Yesterday.

Person 5

Ideally, probably around my 50s, 40s?

Person 6

I want to be able to state when I want to retire. As long as I'm capable and I'm doing my job, and I'm still getting my job satisfaction and keeping my sense of self.

Kerry

Now I think we're at the second stage that we spoke about it and introduced.

So the second step here is all about figuring out your budget and spending. And like we might have 20 or 30 years once we’re retired that we need our money to last for so long. How do we approach that Pete? Give me some tips.

Pete

So one of the tips I might start with is, is getting your head around your spending habits now, okay. And have a, have a reasonable focus on that for, you know, the next fair few years so that you've, you're really thinking about these things and how it's how it looks like now and how it might change, you know. Then think about how how you spending patterns might change in life after work. You know, what what what are you going to do differently? How are you going to spend differently? And consider that you're going to have a lot more, spare time on your hands. You’re going to have a lot of spare time on your hands.

Kerry

Think of all the coffees you'll be paying for with those, all those hours, Kate.

Kate

Yes and imagine how many streaming services might be available, then as well?

Pete

Quite right. And then what we’re paying for coffee now, and think of what it will be in the future. So it's not oh yes we have to from double that. So that's interesting to think of.

So you know, one thing to one thing to think about is in our full time, you know, working life, we're often busy and time poor. Okay. And our purchasing patterns sometimes reflect that time-poor, convenience orientated purchases. Right. So in our life after work, we're going to, we potentially will have more time for shop around to look for better deals.

Because we'll have that time to go and explore different channels and goodness, who knows what's going to be available for us to shop? What platforms and what avenues that will be available to us to shop, shop through, in, in the next few years coming.

So it might be about a morning coffee. It might be a favourite place to go for coffee. It might be not that cheap. But, you know, there's options. And putting fuel in the car, you know, we might go to the very corner petrol station, which might not be the cheapest around, but we'll have that a little bit more time and might be things like, you know, minor home maintenance, things that we, you know, perhaps didn't have time to do or we might have paid someone to do in our working life. We might go and have a crack at it ourselves with a little bit of YouTube research, which I must be, I must admit I've been guilty of in the past. So gets you through. So it's all about that time at the time. And then, you know, breaking down where your income will come from. So you've got to consider this, you know, the money from your super. And you, may you may or may not have, dividends from shares, or you may also have income from a rental property. So you might be fortunate enough to have those things as well.

The next thing, I suppose, once you've got a really good handle on what your income is and what it might be in the future, and what your spending is today and what it might be in the future. Is to then, the next question is, am I going to have enough? Okay. Am I going to have enough? And fortunately Rest have calculators that, that our members and actually anyone in the general public can use to start to work out these things. And we, we strongly encourage for people just to jump onto our website, rest.com.au. If you if you've ever been to our website, we've got a few choices across the top. Go to the tools advice tab and in there there's the calculators and get in there, pop in some numbers. Give it a red hot go as they say. You might not get it right the first time and you might want to redo it.

Go your hardest. But it'll start to paint a picture of what your, what your income and spending and how long it's going to last.

Kerry

Awesome. And we'll pop those in the show notes as well. So, you can access them there too.

Kate

So we've spoken about visualising. So our daydreams. We've spoken about budgets and ways to approach those with our spending now, and our spending in the future, our income now, income in the future. Where would the best place be if one of our viewers or listeners is ready to start today?

Pete

So a great place to start, Kate, is, is for our members, to consider some phone based advice, is just having a phone conversation.

Kerry

The big advice word.

Pete

The big advice word, which, you know a lot, a lot of people build up to being quite an intimidating thing. And it's, I guess it's a bit of that fear of the unknown, isn't it? You know, if you don't know if you're changing doctors or you're, you're changing another professional service and you don't know the person, then and there's always going to be a little trepidation there.

But, I can vouch they are all human beings, and very warm ones indeed. In our in our advice team, in our specialist team. But, you know, consider having a phone-based conversation with those people. So our Rest members can access, our Rest specialists at no extra cost. And if there is a need, then they can put the members in touch with one of our financial advisers who, will explain if there are any costs. They will explain them in full prior to any work being done. So that's really important for for our viewers and members to understand.

Kate

It is such a valuable service. It really is. And, and I think if our viewers even just go through the budgetary exercise and their spending, they will find that that conversation would be transformative for them anyway. It will be a great conversation just based off the work that they do.

Pete

Yep

Kerry

And the fact that the phone, the speaking with a specialist, over the phone for our members, that's a fantastic place to start, right?

Pete

I know right? Yes. It really is. You do it in the comfort of your own home, in the quiet, peace and quiet. No distractions, you know, grab a notebook just to write down some notes. And you can to do it at your own pace.

Kate

And they are a wonderful, wonderful bunch of people as well.

Kerry

And I think there's actually a booking form on the website so that we can pop in the, in the show notes as well, so you can actually book a time that suits you, online as well.

Pete

Absolutely. It's really easy to use.

Kerry

Yeah. Great.

So we've just gone through step one, which is planning and preparing, step two, which is understanding how your spending habits impact your plan. So now we're going to move into step three, which is all about smart tips on how you can get ahead and boost your balance.

What do we need to think about or what can we do to start doing that.

Pete

I guess the first thing I'd say, Kerry, is it's never too late, okay? It's never too late to do something and take some action. So there's always something our viewers can do.

You know, it's no longer that it's a case of, you know, work, work, work and then stop. Right. It's everything's changing these days. And that concept that we spoke of before in downshifting, you know, that's you'll probably hear a lot more of that word in the future by, people a lot smarter than I am.

You know, you may go from full time work. You might then transition to maybe part time or casual work before you, you finally get to full time life after work. Or you may go from full time work to maybe full time retirement, full time life after work. But then after a period of time, you may decide. I might just slip back into the workforce. All those things can work for different people,

Kerry

And I feel like Pete, there's, I guess, the trend that comes up of, well, it's not even a trend. I think we all think about it like, I wish I'd done something sooner. Yet at the same time, we still haven't done anything, so, like, what can we do?

Kate

And then we don't because we're scared that we haven't done enough

Kerry

I know, then it's like, do we..

Kate

I don’t want to know

Pete

So let me ask you this question. What's… what's stopping you take a step now and, and filling out that list?

Kerry

Isn't that like, that is such a great question because even working in super, I know I need to do it. Like I know it needs to be done and I still, still don't sit down and do it. It's almost like you need to put in your calendar and go, right on Friday afternoon, I'm just going to have a glass of wine and do that.

Pete

You know I'm going to ring you both next week and see if you've done it, right?

But it's things like that. It's asking you the hard questions and, you know, give yourself a good talking to and say, well, what's stopping me? What's stopping me starting the list? What's stopping me starting a spending plan and having a look at my bank statements for, you know, these days you can download your bank statements off of the, off of an app or from the, the, financial institution website.

And, you know, let let the… our flash computers help us work all that sort of stuff out. So there's lots of tools available to us to be able to look at that sort of stuff. And then, you know, the next question I'm going to ask you both is what's to stop you having a 30 minute conversation with one of our fantastic financial advisers, even now in your late 20s and early 30s?

Kerry

It's really it's, I guess, just taking some ownership and accountability. Like, no one's going to do it for me.

Pete

No one's going to do it for you. Kerry.

Kerry

So it isn't like, as you say, it's just not always a linear journey of work work work, stop and retire like this. You know, different courses that people take in different ways that

Pete

Exactly right. Exactly right. Kerry. And one of the things that people might consider, as I get closer to this transition period, is a thing called a transition to retirement strategy.

Kerry

Ooh I like the idea of this.

Pete

I know, right? So this is actually, you know, it's a plan. It's but remember I said before, hope is not a plan. And so it really ticks all the boxes for me. And that is, you know, a transition to a retirement strategy.

Kerry

Yeah. Great. And yeah, and the dropping down work or changing hours or changing your lifestyle, you know, there's all different ways that you can do it. So speaking to a specialist about it really helps.

Kerry (cont’d)

And what about once I've retired, Pete. Like what, what happens then like once you, you make that decision to retire? Is there anything I can do once I've retired, you know, returning to work or, how does that work?

Pete

Absolutely. Yeah. So, you know, the world's your oyster. You can have a rest. You know, you you might find that your first three or 6 or 12 months of of life after work, it might be 100 miles an hour again, you might replace your work routine with another routine. And you might keep busy that way.

Other for other people, it might be a nice long rest, and they do virtually nothing. And they, they avoid the clock on the wall and they avoid the wristwatch, and they avoid the diary. And they just do things perfectly as they might do. So, you know, once again, horses for courses, and whatever suits you, suits you.

But yes, you may decide after a period of time that that work is calling. Or you might have identified a little side gig, that you thought about during your working life, and it's time to have a crack at that. So, you know, there are plenty things you can do.

You don't, you know, the old the old concept of you have to stay retired. And you get the tattoo that never leaves you that. Yes, I'm retired and that's just not in the vocabulary.

Kate

There's options.

Pete

There's options. Exactly right.

Kate

So my mother in law was a teacher for 30 years, and now in her late 70s, she's running all the ethics classes at her grandkids schools.

Kerry

Isn’t that great?

Kate

Yeah, it's so great. So she goes on a Tuesday morning and a Wednesday morning and, teaches ethics. And it's wonderful. She's part of that ethics community. The kids get to spend time with her. They get to really show off in class, you know, and have their nan at the school. And she just loves it. It's a great connection, back in, and gives her a lot of joy. So there are lots of options.

Kerry

Yeah. Great.

Pete

Social connection is so important. You know, we we are human beings. We are, we are born of a connection between two people, obviously a relationship. So, the research shows that connection is so important to maintain and nurture. So. Yeah. So that's a great, great story.

Kerry

We have covered off a lot. We have, but you know what? We haven't even really got to the age pension. And, you know, that's probably an episode in itself. So, Pete, maybe we can ask you back, for another episode on the age pension.

Pete

I'd love to, that'd be great.

Kate

Pete, I really enjoyed today's session. And also thank you for being here from Adelaide. It's wonderful to have you here. So thank you. I just want to say thanks for coming along today and joining us and unpacking some of these big issues with retirement.

Pete

It's my pleasure. Thanks very much.

Kerry

And if you enjoyed today's episode, be sure to like, follow and subscribe. Share it with your friends. And for more information, we'll include all of the links in the bottom of the description here or the show notes.

And that is super simple.