Five key steps to building a comprehensive retirement income plan.
Are you confident your retirement income is secure? Use our tool to learn about a comprehensive retirement income plan.
When it comes to your retirement there are four main risks that can impact your income:
As you don’t know how long you will live, there is a chance that you could outlive your income or that you will have to rely solely on the Age Pension that may be insufficient to cover your basic living costs.
Even small increases each year to the cost of living can, over time, have a significant impact on how far your money will go. Without the right strategies in place, increases in inflation over time could mean your retirement income will no longer cover your living costs.
3. Market risk
Exposure to investments such as shares and property comes with the risk of market volatility. When investments earn negative returns, your retirement savings are falling in value. It’s important to consider how best to minimise the impact on your savings from market volatility during a 20-30 year+ retirement period.
Poor returns on investments when your savings are at their peak may significantly impact just how long those savings will last. In retirement, timing is everything. If the order and timing of your investment returns is unfavourable, it could result in your retirement income running out sooner than expected.
Challenger lifetime annuities give you an additional layer of protection in retirement and can act as a safety net giving you income for life, regardless of how long you live.
Annuities works by complementing your other investments, together with the Age Pension (if you’re eligible). A lifetime annuity provides a foundation that you can depend upon to cover your basic living costs. Whilst they are designed to be held for life, there are withdrawal periods where you may access a lump sum if necessary.
Challenger’s lifetime annuities provide different monthly payment solutions to suit your financial circumstances and needs. For income certainty, you can choose CPI indexed or fixed payments. Alternatively, you can choose to have payments linked to changes in the RBA cash rate or investment markets.
Everyone’s financial situation is different – so it’s a good idea to seek professional advice. Contact your financial adviser to determine whether an annuity is right for you.
The information on this webpage is intended to be general advice only and has been prepared without taking into account your objectives, financial situation or needs. Because of that, you should, before acting on any such information, consider its appropriateness, having regard to your objectives, financial situation and needs.
You should obtain and consider the relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making a decision about whether to acquire or continue to hold any financial product.
