The retirement ‘hack’ that no one talks about

Last week we blew past 2,000 readers and plenty of legends have joined us this week too.

For some of you, last week may have frightened you into thinking that you can never retire.

How on earth could you pay off an entire property in order to remove your living costs?

Or maybe you thought you don’t want to retire in the house you currently own. 

Righto problem child lets look at another solution when you get to that retirement age.

How about working? Someone had to say it. Just because you hit the retirement doesn't mean you have to stop working.

Quick Quiz - what is NZ's official retirement age? Answer in the 'Did you know' 

It seems that a lot of retirement commentary focuses on this magical day where you stop working. 

I've filed many tax returns for retirees and most of them still have earned income in their tax return to add to their pension.

Research suggests that work actually makes us happier in retirement. Who would have thought.

Imagine sitting in a room, playing cards of humanity by yourself, you'd get bored at your average chat faster than your usual opponents do.  

Given most people continue to work or spend their time doing things they love, you aren't all of a sudden going to have a huge stack of mates who are keen to hit the local happy hour.

 So working aye? Even if you were to work two days a week at minimum wage you'll be bringing in close to $15k a year to help fund your lifestyle choices.

Time for that math that I promised you. Really quickly though:

• $20k coming in from your Kiwisaver pot
• $15k coming in from a job 2 day a week
• $20k coming in from your pension

$55k in income each year (that's more than the average Kiwi annual salary). 

PLUS: Remember you won't be paying tax on your Kiwisaver $20k withdrawal as it's yours and not taxed.

BONUS: Managed to pay off your home so not paying rent or a mortgage? That's like adding $15k back to your income as you don't have it as an expense. 

Managed to pay off a rental property during your working life too? That will add a weekly income stream to your income column too.

What did you just learn?

With retirement, it is time to think differently. Do the math and don't let retirement scare you. 

It depends on your definition of retirement. The internet says it is ‘the action or fact of leaving one's job and ceasing to work’. It is our responsibility to figure our own definition for ourselves. 

Activity 

• What does retirement mean to YOU?
• Work backward from there to make a plan as to how you could make that happen

Before we go: don't buy sh!t you don't need just because it's 'Black Friday'. It's not invented for you, it's invented for retailers.  

Luke

P.s. You are one of 2,130 recipients. There are 21 people working through KTC Night School.

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Did you know:  NZ does not actually have an official retirement age. Many people aim to retire when they are 65. The age when most superannuation plans begin to pay out your savings.

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