Banks.com.au - Australian Banking, Finance and Investments

11 April 2008

If you're at the stage in your life where you're planning ahead to retirement, then it would be best if you start preparing the appropriate financial products as soon as possible. To enjoy retirement to the fullest you will want to have a reasonable income to draw upon as well as being capable of long term financial commitments. The earlier you prepare for retirement, the greater the potential for autumn years of relaxation without financial hassles. Consider carefully whether you are getting the best out of these areas of financial products.

Superannuation

It can be far too easy to leave the company you work for to choose your superannuation fund, but they will have different priorities to yourself, focused more on low processing costs rather than generous returns. Do your own research into the best superannuation funds. Thanks to online search functionality it is really very simple to find out not only what the super funds say they are offering but also opinions on their service and rate of returns. Just because money is automatically paid into your superannuation doesn't mean you should rely only on this for your retirement. The Australian government offers enticing incentives for voluntary super contributions, and making the most of this as early as possible will lead to the greatest benefit in retirement.

Savings accounts

You will not want to tie up all of your money in superannuation, as on occasion you will certainly need larger sums than you can withdraw from it with ease. Still if you have money that you are not going to use for a considerable amount of time and you don't wish to risk the stock market, or else have profited from those risks and wish to preserve what you have made, then a high interest savings account could be sensible. With interest rates looking to rise again in the future, and to remain fairly high for a considerable time to say the least, interest on savings accounts is higher than it has been in years. Funnel your unused funds into a savings account with less access and higher interest, and see your savings grow.

Personal loans for vehicles

If you're getting close to retirement, then you may want to start planning your next car purchases carefully. Decide whether you want extravagance in a vehicle or in other aspects of your life, because you will need considerable savings to achieve both. If you plan on getting a reliable and cost efficient car for retirement, then the purchases you make now should probably reflect this. Cars with a proven high resale value may be preferable to flashy ones that depreciate too quickly. There are also other vehicles to consider, such as boats. Not everybody wants to spend their retirement fishing, but those who do will want to either save for a decent boat or else start looking for a good personal loan to pay for the expense now. Such an investment is probably best to work towards while you are still earning an income, as this will give you time to work towards a superior boat in the future.

The right credit card for your plans

Credit cards are not all alike, and depending on what you plan for retirement and your past experiences, you will benefit more from a specific kind of credit card. If you have found that having a credit card in the past has led you to debt, then you would probably be best requesting a lower credit limit, and choosing a card that focuses on interest free days with a very low interest rate. For those who are thinking about travel, then reward program credit cards will probably provide good value, as reward programs often focus on helping you spend reward points on luxury and holiday expenses. If you merely need to keep a tight budget in order to ensure a relaxed retirement, then cash back and fuel discount credit cards will probably be preferable for your circumstances.

Please visit our dedicated pages for more information on long term banking for retirement.

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