Now or never?

Live for today or save like heck for tomorrow? It is a conundrum facing many baby boomers. In our latest Money Makeover, we look at one couple's quandary as they work toward retirement.

Samantha and Thomas are typical boomers. At 50 and 55 respectively, they are feeling the pressure to pad their retirement nest egg, yet want to enjoy life to the fullest while good health is on their side.

Recently they decided to take the plunge, dipping into their savings to finance a long-awaited OE. The splash out ($67,000) will not deplete their retirement savings, but they wonder where it will leave them long- term.

"Are we in trouble, or will we be OK?" asks Samantha.

Although they are a single-income family, they derive additional revenue from two rental properties and home-stay students.

They also own a prime piece of land that they plan to build on for the purposes of additional rental income.

They also have $63,000 in separate investments, excluding separate monies they have earmarked for travel.

Despite money in the bank and their property, they are unsure how well placed they are for retirement.

They have estimated their spending requirements in retirement at $70,000 per annum and would like to retire when Samantha is 60 and Thomas 65.

From age 76 onwards, they anticipate that would reduce to $45,000 a year. In addition to that, they hope to do more travelling in a few years' time. Here's how their situation breaks down: Assets: (including home, two rental properties and land) $964,000. Debt: $110,293 (mortgage). Combined gross income: $69,000 net. Household expenses: (annual) $28,988.

Insurances: (house, health, motor vehicles) $3834. Transportation: $3514. Utilities/rates: $9300. For an expert opinion, Money Makeover consulted two Christchurch-based certified financial planners - Mark Hubber with New Zealand Financial Planning and Fiona Woodford with Myles Wealth Management. 

* Interested in a free Money Makeover? Contact us.

In person: Cathedral Square.
By post: Private Bag 4722, Christchurch, 8140, attention: Amanda Morrall.
Email: Amanda.Morrall@press.co.nz (subject line: Money Makeover).

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