Financial planning is often shaped as much by experience as it is by numbers. This edition explores how past economic events continue to influence the decisions many Australians make today, why later life requires a different approach to managing money and decision-making, and how retirement travel can affect pensions, concession cards and financial arrangements. By reviewing these important areas, you can better position yourself to adapt to changing circumstances and make decisions that support both your current lifestyle and your long-term goals.
When Mortgage Rates Were 17 Per Cent
Many Australians nearing or in retirement still carry financial habits shaped by the high-interest-rate environment of the late 1980s and early 1990s. While mortgage rates were significantly higher then, today’s borrowers often face larger debts relative to income and cannot rely on inflation reducing debt as quickly as previous generations did. The article examines the lasting lessons from that period and challenges whether old assumptions about debt, cash, property and interest rates still suit today’s financial landscape. Understanding which beliefs remain useful and which have become outdated can help retirees and investors make better decisions in a changing economic environment.
A Letter From Your 85-Year-Old Self
Living into your mid-80s and beyond is becoming increasingly common, making later life an important planning phase rather than an afterthought. Research suggests financial capability often declines gradually with age while confidence remains largely unchanged, creating potential risks for decision-making and financial management. Simplifying finances, documenting key information and establishing formal decision-making arrangements can make life easier for both you and your family in later years. Planning early allows you to make thoughtful decisions while you are best positioned to do so and can reduce stress and complications down the track.
The Retirement Passport
Extended overseas travel is one of retirement’s great freedoms, but several financial, health and government benefit rules can affect how those plans unfold. Travel insurance, medication management, overseas health care arrangements and pension portability rules all deserve consideration before departure. Changes to Age Pension, Pension Supplement and Commonwealth Seniors Health Card eligibility can affect longer trips and may alter retirement income arrangements while overseas. Understanding these rules before travelling can help retirees avoid unexpected issues and enjoy greater peace of mind throughout their journey.
Q & A
- Will the new capital gains tax rules affect my investment property sale?
The impact depends on when the gain accrued and whether you receive an income support payment such as the Age Pension.
- Why am I suddenly being asked for identification?
Expanded anti-money laundering laws now require many professionals, including accountants and real estate agents, to verify client identities.
- Is it too late to contribute to super if I’m approaching age 75?
Most voluntary super contributions can generally be made until 28 days after the month in which you turn 75.
- Can I rely on my bank’s new account name-checking system?
Confirmation of Payee is a useful protection against scams but should not replace independent verification of payment details.
- Will taking in a lodger affect my Age Pension?
It can affect the income test, but usually less than people expect because only part of the payments received are assessed as income.
