Just for interest, as it was subject to discussion, I found this on a charting website.
A common rule of thumb is that if you want to retire at 60, you will need about 15 times the amount you have calculated for your annual after-tax retirement expenses. So if you estimate $60,000 per year then you will need $900,000…..According to the latest data for September 2012, in general, a couple looking to achieve a comfortable retirement needs to spend $56,236 a year, while those seeking a ‘modest’ retirement lifestyle need to spend $32,511 a year….. The figures in each case assume that the retiree(s) own their own home and relate to expenditure by the household.
Comments 1. The pension pays $30,000 you can have 400,000 in cash- any more than this spend upgrading your house to water front and with your 30,000 gov money for couple and near 10% after tax refund from telstra this should give you 70,000 to spend each year- proplem solved retire now no rent water front living and live of the gov and go crusing and travel aust -well properly travel else where until you need the near free helth care cover everyone else does and they complian -what a bludge get it while its hot.
2. Your estimate of $60,000 ater tax retirement expenses is equal a 6.60% yield. To achieve this level of return will require you to invest in high yielding fully franked Australian equities and assumes the tax payer is in pension phase ( not accumulation phase) and thus receives dividend income tax free. If one invests in residential real estate the yields are much lower ( circa 4.00%) and will require a capital value $1,500,000 at a ratio 25 times your desired $60,000 ater tax living expenses. By way of comparison, commercial real estate can yield closer to 9.00% and require a much lower ratio.
Clearly the first commenter wants to play the game for all it's worth. I guess one could take out a reverse mortgage and trade down every 10/15 years?
Sounds like number 2 is similar to Frack's thoughts re commercial real estate - LOL
