With the changes to the superannuation laws from 1 July 2017 most pre retirees are concerned that they will outlive their retirement and investment assets in retirement. Others are concerned that they only will have two choices. (i) they either downsize their residence to free up capital in order to retire, or (ii) continue to live in their home but continue to work, as they will not have sufficient superannuation to retire. It is estimated that if a couple were to retire today, at age 60 they would need approximately $900,000 of superannuation and or investment assets outside of super, in order to retire comfortably, not lavishly. In other words, if $900,000 is invested in super at age 60 and you draw $55,000 per annum to live on each year, indexed with inflation, that capital of $900,000 will expire by age 85, assuming you received 5% investment return net of fees and charges. There is no doubt that the best means of saving for retirement is through superannuation. That is, regardless whether that superannuation structure is an industry fund, retail fund or Self Managed Super Fund, even after the latest round of tax changes, it still remains the best structure for someone financing their retirement. One of the biggest problems with saving for retirement is the reduction, by the government, of the tax deductible contributions to super. That is, from 1 July the maximum tax deductible contribution to super will be $25,000. In my opinion, this amount is ridiculously low. The reason being, that the figure that I quoted earlier, the $900,000, is increasing by CPI each year, so if you are 59 years old that figure will be, say $918,000 next year if you factor in CPI of 2%. If you are a 50 year old by the time you retire it will be $1,100,000 or a 40 year old by the time you retire it will increase to $1,330,000. Therefore, of the $25,000 that you contribute to super $18,000 of that is just keeping up with inflation. The moral of the story is, as a result of these changes to super, we need to consider retirement strategies inside and outside of our superannuation in order to maximise our wealth and legally minimise our taxation, to ensure we can experience retirement. Should you have any queries in relation to retirement strategies please feel free to contact Peter Quinn by submitting an online enquiry or calling us on +61 2 9580 9166 to book an obligation free appointment. The information in this document 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. It is important that your personal circumstances are taken into account before making any financial decision and it is recommended that you seek assistance from your financial adviser.