The Income Curve – Why You Need To Be Acting - McCarthy Group The Income Curve – Why You Need To Be Acting - McCarthy Group

The income curve represents how much money you make over your lifetime. As you would expect, from 18 to around 55 you are on a steady climb, until you retire, where your income plummets to nothing. But what impact does that have on you? Could you afford to retire on time?

The chart below is an example of a typical income curve in Australia. It looks pretty much exactly as you would expect. You start out on not very much, then earn progressively more as you get older, until you retire. But what are you actually doing with your money throughout your life? If you aren’t putting away 5-10% of your income each year, how are you going to support yourself after you retire?

Awareness of your financial situation is the first step to understanding how you have to act to keep your money working for you. The income curve above is an optimistic view on how much money you have each week after retirement. For many, the pension is the only way to support yourself after retiring. The pension in Australia being $335.45 for a single person, or $252.85 for each person in a couple, each week. That means you need to support yourself on either $13,148.20 a year, or yourself and your partner for $26,296.40.

It’s little surprise that 90% of Australians are under-provided when it comes to retire.

Oh, and if you are just putting money in the bank, after tax and inflation, you aren't actually making anything...

Oh, and if you are just putting money in the bank, after tax and inflation, you aren’t actually making anything…

But what can you do about it?

Think about your own financial situation, if you had to live on nothing but your savings and assets for the next 6 months, could you do it? If the answer is no, then you need to start acting. Retirement comes quickly, and while not acting is very simple, the consequences of not doing anything are not. Just think about those figures, can you live on $13,000 a year?

We have found over the years that almost everybody puts financial matters far away from their minds. Most of the time it’s just too hard or too stressful to think about. We take an opposing view, by being aware of your money you can be on top of your financial situation, making retirement a lot less stressful. Finance and accounting can be difficult, and for many there just isn’t the time to keep up to date on all of the ways to keep your money performing.


And for many more, the tax man taking your hard earned cash is just part of life! That’s money you can get back!

Over 17 years we have been helping everyday Australians make the most of their money. You can’t do anything blindly, so we guide you through the complexity, making difficult taxation and financial processes simple, so that you can understand what the benefit for you is.

If you go blank when thinking about your financial situation, then you need to start thinking about ways to meet your saving goals. It doesn’t matter if you want to be a millionaire or just be able to live comfortably, we have tailored investment products and services which can help you save, and make money.

Don’t believe us?

Give us a call today on 1300 850 318. Our financial advisers will be happy to organise a time to discuss how McCarthy can save you money on your mortgage, or get the refund you deserve from your tax returns.

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