Retirement planning timeline

Time and time again we're told to plan for our futures and make sure our finances are in order. It's never too early to begin thinking about retirement, so where do you start?

15 to 20 years from retirement

It's essential to consider your finances. Involve a professional financial planner and write down a detailed financial plan, based on your current goals and aspirations. You should also:

• prepare a will;
• arrange an Enduring Power of Attorney - a formal agreement where you appoint someone to make decisions of your behalf in the event that you are unable to manage your own affairs;
• arrange an Advance Health Directive - a document detailing instructions regarding your future health care, in case a time comes when you cannot make these decisions for yourself.

5 to 10 years from retirement

Revise your financial plans. Some considerations are:

• how much money you will need in retirement;
• how much money you anticipate having available;
• determine a suitable retirement age where money available will cover the money you require;
• retirement investments;
• superannuation;
• possible government pensions; and
• tax issues.

For many people, boredom is a major issue in retirement. Plan your activities now; update any skills you may have or begin to learn something new. Can you use these skills to bring in extra income after retirement?

1 to 2 years from retirement

This is the time to review and revise your financial plan.

• Are you on track to retire when you originally anticipated?
• Try to plan a retirement budget and practise using it.
• Have you cut down your hours at work? If so, you need to keep a close eye on your superannuation. Speak to your fund about any negative financial consequences of your decision.

Are you keeping active? How about joining clubs and making new friends? Do you want to travel? Begin your plans now and determine where and when you will go.

Where are you going to live in retirement? Now is the time to change your home or car, if necessary, to accommodate your changing lifestyle.

6 months from retirement

Make any final adjustments to your financial plan and budget.

• Are you still on schedule?
• Check your will. Is it still effective?
• Are your Enduring Power of Attorney and Advance Health Directive still valid?
• Obtain statements from your superannuation fund(s).
• Review any life insurance policies you may have.

Keep up with those activities and friendships you've been cultivating and remember to look after your health. If necessary, get a medical check done and review your health insurance.

3 months from retirement

Using the checklist for the 6 months from retirement above, make sure your finances are in order.

Are you eligible for the aged pension? You can apply for this up to three months in advance so speak to your local Centrelink office.