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With the Federal Government announcing their three-stage plan to restarting the Australian economy, businesses around the country are eagerly awaiting a return to “normal” work after COVID-19. However, what will this post-pandemic environment look like, and ho.....

Super, Retirement - 2 min read

Retirement is the perfect time to travel. The kids are grown up and taking care of themselves, you’re not constrained by your employer’s demands and schedule, and you finally have the freedom to explore the world.

After you retire you’ll definitely have the time to travel, but will you have the money? Hoping you’ll be able to travel probably won’t be enough; you’ll have to plan for it. But planning and preparing now are certainly achievable. Use the following 3 tips to ensure that your travel dreams come true in retirement.

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Calculate Travel Costs, Factoring Inflation

Be as specific in your travel plans at possible. Are there certain places you’ve always wanted to visit? People with specific travel plans are almost three times as likely to save enough money than those without specific goals, so be as specific as you can.

Once you know where you want to go and how long you want to stay, you can calculate the costs of that travel. It’s not uncommon to underestimate the costs of travel, and that’s where people run into trouble. Therefore, give yourself a 20 percent cushion when you calculate your costs, and then allow for inflation, at least 3 percent per year between now and then. If you end up with too much money saved, you can always take another trip or upgrade your travel.

 

Plan for the “Go-Go” Years

People often think they’ll be able to travel throughout their retirement years, but the reality is that most people slow down in their advanced years. Many people over age 70 report that health concerns impede their travel plans, so plan on taking your biggest trips in the years between retirement and your early 70s. Of course, this varies greatly from person to person, so plan well and then enjoy the flexibility you’ve earned by working hard to save and plan.

 

Downsize Early

If traveling during retirement is a priority to you, consider downsizing your home early as a part of your plan to fund your travel. Downsizing reduces many of your day-to-day costs such as utilities, property taxes, and maintenance repairs. The savings from all of these reduced expenses can be used to fund your travel savings.

Once you retire and start traveling, it’s much easier to maintain a smaller home while you’re away, so it makes sense to downsize early if traveling is a priority for you.

By calculating travel costs and factoring inflation, planning for the “go-go” years, and downsizing early, you can ensure that your retirement will be filled with the kind of traveling you’ve always dreamed of. To speak with a retirement expert about your own planning, reach out to us.

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