Step 2 - Where do I need to get to?

The second step of the process sets out to quantify your future goals in terms of the financial resources you will you need to support the lifestyle that you plan to lead when you decide to stop work. For many couples this can be a very sobering step, as it serves to highlight the shortfall that you will face when you calculate your current and future position in step 1, and then contrast this with what you hope to have available in the future in step 2. There is normally a very big gap between the two, and it can be distressing if you have no clear plan regarding how to climb what has now visibly appeared as a very high mountain indeed.

How McCarthy Group can assist:

The process and workbook used in step one makes provision for the calculation of the income requirements that you will need to fund your ideal future lifestyle. For example, if you feel that $40 000 per year will be the level of income that you will require to live in comfort once your work income stops, it shows that you will need an asset base of $800,000 invested at an interest rate of 5% per year to enable this. If you are not on track towards achieving this position, and if for example you have 10 or 15 years to go to normal retirement, it is virtually impossible to save $800,000 in this time frame. All the revenue-generation possibilities open to you are covered in the workbook consultation process, and the reality of the challenge you are facing is made apparent. And as difficult as it might seem at first, what becomes apparent is the need for change.

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