Here are four of the most common mistakes.
Mistake 1: Becoming Too Conservative Too Early
As retirement approaches, many investors dramatically reduce exposure to growth assets out of fear of volatility.
While risk should be managed as retirement nears, eliminating growth entirely can be damaging. Retirement could last 30 years or more. Without exposure to growth assets, inflation can steadily erode purchasing power.
The goal is not zero risk. It is appropriate risk.
Mistake 2: Missing Contribution Opportunities
Your 50s are often peak earning years. This creates powerful opportunities to boost super in a tax-effective way.
Concessional contributions, catch-up contribution rules (where eligible), and strategic timing of income can materially increase retirement balances.
Failing to review contribution strategy annually can leave significant long-term benefits unrealised.
Mistake 3: Ignoring Tax Structuring
As balances grow, tax structuring becomes more important.
In your 50s, you should begin thinking about:
- Super balance equalisation between spouses
- Transfer Balance Cap implications
- Division 293 exposure for high-income earners
- Estate planning alignment
Ignoring these considerations may not feel urgent today, but they can have long-term consequences.
Mistake 4: Not Modelling Retirement Properly
Many Australians rely on generic super fund projections or simple assumptions. A proper retirement plan should test:
- Income sustainability
- Market downturn scenarios
- Inflation
- Minimum drawdown requirements
- Age Pension interaction
Without modelling, retirement becomes an assumption rather than a strategy.
Your 50s represent the final runway before retirement. Small adjustments now can create meaningful long-term impact.
Disclaimer: This information is general in nature and does not consider your personal objectives, financial situation or needs. You should consider seeking professional advice before making any financial decisions. Past performance is not a reliable indicator of future performance.
