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A retirement plan built to last

Staying the course, and not being distracted by short-term market events, is just as important in retirement as it is at any other time.


Retiring from work shouldn’t necessarily equate to retiring from managing your investment portfolio.

In fact, taking an active role in your investments during retirement will ensure you have the best chance of protecting and growing your capital over time.

Australian Bureau of Statistics data shows average life expectancies in Australia are now at a record high and among the highest in the world.

According to the latest ABS statistics, the average male life expectancy at birth had reached 81.2 years in 2018-2020, increasing from 80.9 in 2017-2019.

The average female life expectancy had also increased to 85.3 years, from 85 years.

From a financial perspective, a key question for most of us is whether we’ll have enough money to last all the way through our retirement years?

In fact, it’s such a common question that in financial circles the prospect of running out of retirement money before death is officially known as “longevity risk”.

Reducing financial longevity risk is a challenge.

For many retirees, low-risk assets such as cash and government-backed bonds are often seen as the safest ways of protecting capital over the long term.

Yet, depending on your broad retirement goals and tolerance for risk, putting all your eggs into low-risk asset classes may expose you to investment hazards over the longer term.

What you may see as a safe investment strategy today could easily become the opposite over time.

The 2022 Vanguard Index Chart puts that all into context, because it shows exactly how different asset classes have performed over the last 30 years.

Cash is arguably the safest investment there is, especially in Australia where the federal government guarantees the security of all deposits with authorised deposit-taking institutions up to $250,000 per accountholder.

If you’d retired back in 1992 and had invested all your savings into cash that year, you could have earned a return of 9.0 per cent.

But cash returned just 0.1 per cent in 2021-22, and since 1992 it has delivered an average annual return of 4.3 per cent – the lowest return of all asset classes.

Diversification pays off

This underscores the importance of having good asset diversification, even in retirement, to help preserve capital and generate longer term capital growth along with income.

You can see from the index chart that $10,000 invested into different assets in 1992 would have produced very different cumulative returns, ranging from $35,758 (cash) through to $182,376 (U.S. shares).

The Australian share market has produced an average annual return of 9.0 per cent since 1992.

The dollar figures in the index chart are calculated on the basis that all of the distributions over the 30 years, including interest and dividends, had been reinvested back into the same assets to maximise the effect of compounding returns.

Asset classes perform differently from year to year, but the historical data going back for decades shows that despite inevitable short-term price dips, over the long term you can expect each asset class will deliver growth.

Since 1992 there have only been a handful of occasions when the same asset class has been best-performing in consecutive years. So, it never makes sense to chase after last year’s returns.

For example, in 2018-19 Australian listed property was the best-performing asset class, returning 19.3 per cent.

Just a year later the same segment showed a negative return of 21.3 per cent (primarily due to the impact of COVID-19) – a reversal of 40.6 per cent.

That’s where Investing across a range of asset classes, including during your pension drawdown phase, will help smooth out poorer returns from other asset classes from year to year.

Avoid knee-jerk decisions

Short-term periods of market volatility can be unsettling.

As global markets fell sharply during the early part of 2020, some retirees hastily chose to divest their equity positions in favour of the relative safety of cash.

In doing so, however, they effectively crystalised their equity losses and may have totally missed the strong rebound in global equity markets that quickly followed.

It’s a powerful example of why time in the market will invariably win over trying to time the market when it comes to achieving investment success.

Staying the course, and not being distracted by short-term market events, is just as important in retirement as it is at any other time.

It’s also important to focus on the things you can control.

That includes reviewing your spending regularly and making sure you’re invested in products that have low management costs.

The lower your investment costs the more money you have to enjoy your retirement.

The best approach to building an investment portfolio that will help protect your retirement capital is to apportion funds across different asset types, such as shares, bonds, property, and cash.

Having a well-diversified portfolio will offset the risks of being too exposed to one asset class.




Tony Kaye


Louise Laing

Louise founded Salus Private Wealth to offer high quality personal advice to clients who want to work closely with an adviser for the long term. Her philosophy that understanding each individual and their motivations and needs is key to an enduring and successful financial planning relationship is at the heart of the business.

She first engaged the services of a financial adviser herself when she was in her early 20s (long before becoming one) and believes the non-judgemental support and education about her position and options provided at this early stage has allowed her to make confident decisions in different aspects of life since then.

This confidence and positivity in making choices, financial or not, is what she wants to give to her clients.

Superannuation & Retirement

Superannuation is one of the largest and longest duration investments most people in Australia have, making it a critical part of long-term planning even if retirement feels like a distant objective. For those in the lead into retirement, we design strategies so you have peace of mind that when you start to draw on your retirement savings, you have liquidity and stability to support that.

Legislation and rules are changed regularly, so advice can help you take advantage of opportunities to build for the future. We are authorised to provide advice on and to SMSFs.

Contact us today to discuss how we can work together: (02) 8044 3057 or email us at


Protecting your wealth, lifestyle and family is high on the priority list for many clients and this is an area of advice need that can change very quickly. Ensuring you have the cover you need can give peace of mind that what’s important is taken care of in the event of illness, injury and death, but we also make sure over time you are not paying for cover you no longer need.

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Estate Planning

While talking about death doesn’t seem like a particularly appealing prospect, it’s a topic we see as a vital part of financial planning. Importantly, it’s a topic for every adult, regardless of their stage in life. Without a proper estate plan assets may not be passed where you’d like them to go, family conflict can ensue, and in the event you lose capacity there may not be an authority in place for the person you would choose to make those decisions for you to do so. While it can be an uncomfortable subject, we are experienced in facilitating these conversations as part of our advice process.

Contact us today to discuss how we can work together: (02) 8044 3057 or email us at

Strategic Debt & Cashflow

Managing debt efficiently can have a material impact on your financial wellbeing and lifestyle. Having a solid plan to understand where your money goes and manage cashflow and debt can eliminate stress and set you on a positive path toward achieving your goals.

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Once we have a clear understanding of what we are aiming for and how you feel about taking on investment risk, we can help direct your funds into appropriate investments to meet your goals. This includes recommending the investment structure, consideration of tax implications, asset types, and putting together a suitable blend for you. You will have transparency of and access to view your investments, providing security.

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Aged Care

Aged care needs can arise suddenly. The complexity of managing this can be a significant challenge at a time when your focus should be on the person requiring care. We can assess the alternative funding options to ensure you make an informed choice in the best interests of the person requiring care.

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The Trustee for Laing Weaver Family Trust T/A Salus Private Wealth (Corporate Authorised Representative No. 1305571) and all our advisers are Authorised Representatives of Sambe Investments Pty Ltd T/A Finchley & Kent, Australian Financial Services Licence No. 478766, ABN 67 078 995 856, and has its registered office at Three International Towers, Level 24, Tower 3, 300 Barangaroo Avenue.

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