The 3 stages of retirement

Australians are living longer than ever before. So it’s important to be financially ready for retirement — and the changes to your lifestyle along the way.

While it’s great that we’re living longer, it means we need to be better prepared financially for our later years. It’s also important to realise that our lifestyle is likely to change during retirement, with each stage having particular financial needs. Of course, every person is different, but here’s a broad overview of what each of the three retirement stages could look like for you.

Early retirement

Early retirement usually begins in your early 60s and can last right up to your mid-70s, depending on your health and energy levels. The main focus should be on enjoying the free time that comes from no longer having to work — or perhaps only working a few hours a week on the things you really enjoy. This may allow you to spend more time with family and friends, start a new hobby or take those trips you’ve always dreamed of.

This is likely to be the most expensive time of your retirement, with much of your spending going on travel and leisure activities, or perhaps to help your children or grandchildren get ahead financially. You may also decide to renovate your home, now that the kids have gone and you’re spending more time there.

If you’re working part time, you may have extra income on top of your super or aged pension. But even then, you’re likely to choose more conservative investments that focus on preserving your wealth for the years ahead.


Your mid-retirement period might start anytime from your late 60s, and may continue into your early 80s. During this stage, you may find your energy levels slowing and your desire to travel or participate in more active hobbies diminishing.

You may also decide to downsize to a smaller home, which involves managing the costs associated with buying and moving to a new property. What’s more, the money you put away from the sale of your house could also reduce your aged pension entitlement, so it’s worth seeking professional financial advice before making any major decisions.

At this stage, you’re less likely to be earning any extra income from work. You may also spend less on travel and leisure, shifting your financial focus towards taking care of your health.

Late retirement

During the final stage of retirement, you may need to pay for extra support to maintain your home and take care of yourself. Your health is also likely to need more attention.

As your accommodation and healthcare needs change, you may decide to move to a retirement village or nursing home — a transition which needs particular financial attention. It’s also essential that you’ve put your affairs in order through proper estate planning.

Get the right advice

A financial adviser can help make sure you’re well prepared for all the stages of retirement. To find out more, contact us today.