Getting a cool tax returnGetting a cool tax return

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Getting a cool tax return

For many years I couldn't work out how my co-workers seem to be getting these really cool tax returns, which let them go on holidays to Bali, where I seem to get tax returns that let me go to the local fast food joint if I was lucky! Since I met my girlfriend I started to go to her tax accountant and I finally understand how it all works. There are so many easy deductions that I can claim now, which is going to help me head to Thailand this year! This site has some of the tips I have learnt to help you maximise your return this year.

When should you start thinking about retirement?

21 April 2015
 Categories: , Blog

Retirement may seem like a lifetime away – but it's hard to ignore that little voice urging you to start preparing. The preservation age (or the age when you're eligible for the pension) is 65 for both men and women in Australia. But retirement takes all shapes and sizes. You don't need to retire at 65, and you don't need to retire completely or all at once. Your retirement age, and the age you should start preparing, will depend on your health, how much money you have, and most of all, your dreams.

Your first step

Think about your average life expectancy by taking into account your health and lifestyle factors. You can use a life expectancy calculator or you can make a rough guess based on the preservation age and the life expectancy of your age group.

Next, think about your dream life in retirement. Do you want to continue working as long as you can, or give back to the community through volunteer work? Perhaps you want to look after your grandchildren, attend to long forgotten hobbies or learn a new skill. Many people also like the idea of travelling and living a life of leisure. Having your goals in mind will help you figure out how much money you will need in retirement.

15 years to go

This is a good time to think seriously about your superannuation. You'll have accumulated a fair bit of super and this is the sweet spot to invest into assets that grow, like shares. Shares may sound risky, but they're actually a safe and clever choice at this stage. Although their value fluctuates, you've got enough time before retirement to accommodate this risk and make a profit in the long run.

10 years to go

Look at your current mortgage. At this stage you may be feeling rushed to pay your mortgage off before you retire so that you're debt free. However, what many people don't realise is that it's sometimes better for you financially to pay off your mortgage after retirement. This way you get to invest more into your super while you're working, and let your super pay the tax off after retirement.

5 years to go

Keeping your goals in mind, it's time to get an estimate on your retirement income from all sources. It's also a time to assess whether you're eligible for government pensions or concessions. This will confirm whether you the right amount of money to live the life you want in retirement. This is also your final chance to consider options that will help you pay less tax on your income. This includes transitioning into retirement by working part time and living off your super, or making a salary sacrifice, where your salary gets cut but you get things like cars instead.

See your financial adviser

Still not sure about what to prepare and when? Your financial advisor or accountant will help you with your long-term retirement plan. It's never too early to start!