What you'd tell your younger self to do differently

In a recent study three out of four retirees would do things differently if they had the chance to start their working life again1

Top six things retirees say they would change1

  1. Make extra contributions to their super
  2. Begin investing at an earlier age
  3. Save more money outside super
  4. Learn more about finances
  5. Retire later
  6. Buy an investment property sooner

So with all the wisdom you’ve gathered along the way, what advice would you give your younger self or young people you know about finances? Here are some ideas.

1. Make extra contributions to your super
A little can mean a lot in the long run. Starting at age 30, if you added $10 a week from your pay before tax, it could mean an extra $24,924 in your super at retirement2.

2. Begin investing at an earlier age
Starting small, and investing regularly can help you take advantage of compound interest in the long term and give you time to build a diversified range of investments.

3. Save more money outside super
It can seem easier to leave it to your compulsory super to build savings, but you can’t access this money until retirement. So having some money set aside that you can access just in case you need to can be a good idea.  

4. Learn more about finances
Knowledge can go a long way and while it may seem daunting, it’s easy to get the basics with accessible and free resources online – search topics, complete online education modules, read articles from experts and search topics of interest. Of course your financial adviser is there to help answer questions and they may present a range of free seminars as well.

5. Retire later
It’s a good idea to plan the ideal shift from full time work as you’ll want to make sure your finances are sorted and your money is working hard for you. Increasingly people are continuing to do the work they enjoy, keep some money coming in and balancing that with other interests.

6. Buy an investment property sooner
It can be easier said than done, particularly in the current housing market, so it takes some planning to get there.

Be prepared for deaf ears

In retrospect these things may make perfect sense to help build wealth. But even if we knew of some or all of these when we were younger, we probably would’ve put them off.

So why do we do that? Don’t worry, it’s normal. We are fundamentally optimistic creatures and when things seem complicated it’s easier to put them off.

Behavioural science shows that we tend to act in the present, giving little thought to the future and what tomorrow may bring and we have optimism bias thinking nothing bad will happen to us. Plus we prefer not to delay gratification—we don’t like to make sacrifices now for bigger rewards in the future.3

That’s no reason not to share your wisdom but when you start out it could pay to get the help of an expert to set you on the right path and keep you motivated along the way. Having a plan that can break down the steps into achievable goals, could be the difference between dreams and reality.

1. Investment Trends October 2016 Retirement Income Report.
2. amp.com.au/alittleextra
3. Acting today to own tomorrow, The Behavioural Architects for AMP 2016

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