skip to log on skip to main content
VoiceOver users please use the tab key when navigating expanded menus

How this single mum is planning to secure a relaxing retirement


Published 22 January 2019

Kirrily Welsh has a thorough plan to fulfil her dreams when she leaves her working life behind, writes Sylvia Pennington.

Workplace learning officer Kirrily Welsh is paying down her mortgage and making additional super contributions to give herself a good shot at the relaxed retirement she’s aiming for.

The 47-year-old single parent is a long-time resident of the NSW regional city of Wagga Wagga. She’s worked full time in a variety of administrative and project-based roles since leaving school in 1988, bar a short stretch in 2000 following the birth of her son Jack.

“Some people have an extended period of time off work with their children, but I just couldn’t afford to do that,” Welsh says. “I was lucky my maternity leave fell at the same time as my long-service leave came due, so that gave me eight months off on full pay. Apart from that, I’ve never had a long break.”

Welsh purchased a home 12 years ago and recently increased her repayments to $1000 a fortnight, to enable her to clear her $170,000 mortgage by the time she hits 60.

Aiming for above-average super contributions

Her employer pays superannuation at 14 per cent, well above the 9.5 per cent minimum.

Welsh salary-sacrifices a further 7 per cent of her pre-tax earnings. As a result of her doing that, her employer pays a bonus 3 per cent, taking her contribution to 24 per cent.

In addition to this arrangement, Welsh makes voluntary contributions of $110 a fortnight, taking her closer to the annual contribution cap of $25,000.

Australians aged 45 to 49 had an average super balance of $114,616 in 2015–16, according to The Association of Superannuation Funds of Australia (ASFA). But men had a lot more than women, with an average $145,076 apiece for men against the average balance for women of just $87,543.

It’s a difference that Welsh has clocked in her own circle, “I have above-average super for my age,” she says, “but I’m the odd one out.

“Not long ago, I was in a room with some girlfriends, and I was the only one with a six-figure super balance. Some of the group had married young and had a long time off with kids – one only had $20,000 in super.

“I guess when we were young, the idea that you grew up, got married and stayed home with children was still the norm. But in our generation there’ll be way more females who end up on their own. And even if you’re in a relationship” – as Welsh herself now is – “I think it’s important that women look out for themselves financially.”

Making your tomorrow a priority today

Retirement planning is low on the agenda for many Gen Xers, as mortgages, childcare and other expenses of the middle years take precedence, according to financial planner Elliot Watson.

“It’s a lot of work to raise a family, pay off a house and give your super the attention it needs,” Watson acknowledges.

But those like Welsh who do take steps now should enjoy a significant payback in a decade or two.

Watson suggests that Gen Xers who want to maximise their retirement position should first consolidate multiple super accounts to save on fees and charges.

However, he adds, check your insurance cover before cancelling old policies to ensure you’re adequately covered for adverse health events, as these can affect future life and total-and-permanent-disability insurance applications.

Ensuring that your investment risk profile is right for your age and stage of life can also make a significant difference to your final super balance. Gen Xers still have time on their side, and an investment profile skewed towards higher growth assets should increase the probability of achieving higher returns in the long term.

Making even modest voluntary contributions now can mean a much more comfortable retirement, Watson points out.

“If you have personal or credit card debts, I’d prioritise paying those off. Then you might look at contributing something like $100 a week extra to your super to start with. If that’s affordable, work your way towards the $25,000 cap.”

Putting your financial future on the agenda

Welsh admits that she only put planning for post-work life on her personal agenda around five years ago.

“There was a very long period when the super statements came and I didn’t even open the envelopes,” she says. “Life was busy. I was working full time and looking after a kid, and they were just telling me there was money I couldn’t touch.”

It was only when she changed jobs in 2014 that she really started to think about what her retirement might look like.

“I love what I do, but I hate having to get up every single morning,” she says. “I’d love to be able to do more volunteer work, to help out more at our gym, to travel with my partner …”

Welsh subsequently wrote a budget, reined in her discretionary spending, resolved to pay off her mortgage faster, and sought an opinion on her situation from close friend and financial educator Jenny Rolfe-Wallace.

“Sixty is the preservation age for my super,” Welsh explains, “but I didn’t know if there would be enough to cover me. Women on both sides of my family have lived until 90, so I knew I needed to be able to fund my lifestyle for up to 30 years.”

Part of what Rolfe-Wallace provided was confirmation that Welsh was taking the right steps now to ensure a secure retirement.

“Before I started getting a handle on things and chatting with Jen, I thought I was probably in a bad spot,” Welsh says. “But now I feel pretty comfortable about where I’m headed – I think I’m going to be alright.”

Explore how Superannuation can work for you

Big super questions

Article

The big cost of multiple super accounts

Do you have more than one super account? Consolidate your super and learn how to boost your retirement savings.

  

Article

Calculate how much super you need for retirement

Do you know how much super you’ll need for retirement? Plan for the future with the help of online retirement calculator tools.


Article

How can super give you the independence you're looking for?

Meeting a financial planner to understand your super can be one of the best things to do for your future. See the benefits.


OnePath Custodians Pty Limited (OnePath Custodians) ABN 12 008 508 496, AFSL 238346, RSE L0000673 is the trustee of the Retirement Portfolio Service (ABN 61 808 189 263, RSE R1000986) (Fund) and issuer of the interests in “ANZ Smart Choice Super”, a suite of products consisting of ANZ Smart Choice Super, ANZ Smart Choice Super for employers and their employees and ANZ Smart Choice Super for QBE Management Services Pty Ltd and their employees.

ANZ Smart Choice Super is issued by OnePath Custodians, and the ANZ Smart Choice Super and Pension product is distributed by Australia and New Zealand Banking Group Limited (ANZ) (ABN 11 005 357 522). ANZ is an authorised deposit taking institution (Bank) under the Banking Act 1959 (Cth). OnePath Custodians is the issuer of this product but is not a Bank. Except as described in the relevant Product Disclosure Statement, the obligations of OnePath Custodians are not deposits or liabilities of ANZ or its related group companies. None of them stands behind or guarantees the issuer or the capital or performance of any investment. Such investment is subject to investment risk, including possible repayment delays and loss of income and principal invested. Returns can go up and down. Past performance is not indicative of future performance.

This information is subject to change. You should read the relevant ANZ Financial Services Guide (FSG), PDS, product and other updates (for open and closed products) available at ANZ.com.au/super and consider whether the product is right for you before making a decision to acquire, or to continue to hold the product. Updated information will be available free of charge by calling Customer Services on 13 12 87.

Taxation law is complex and this information has been prepared as a guide only and does not represent tax advice. Please see your tax adviser for independent taxation advice.

The information on insurance cover is a summary only of the terms and conditions applying to the insurance cover. To the extent there is any inconsistency with the terms of the insurance cover provided by the insurer, the terms of the insurance policy will prevail.

The information provided is of a general nature and does not take into account your personal needs, financial circumstances or objectives. Before acting on this information, you should consider the appropriateness of the information, having regard to your needs, financial circumstances or objectives. The case studies used in this article are hypothetical and are not meant to illustrate the circumstances of any particular individual. Opinions expressed in this document are those of the authors only.

ANZ does not represent or guarantee that access to the ANZ Internet Banking or the ANZ App will be uninterrupted. Temporary service disruptions may occur. ANZ recommends that you read the ANZ App Terms and Conditions available at anz.com and consider if this service is appropriate to you prior to making a decision to acquire or use the ANZ App.

In addition to their salary, ANZ staff members may receive monetary or non-monetary benefits depending on the product they are selling or providing advice on.

Apple, the Apple logo, iPhone and iPad are trademarks of Apple Inc., registered in the US and other countries. App Store is a service mark of Apple Inc.

You need Adobe Reader to view PDF files. You can download Adobe Reader free of charge.