The decade before retirement can be one of the most important periods in your financial life.
Your income may be at or near its peak. The children may be more independent. Your mortgage may be reducing. And for the first time, retirement is no longer a distant idea.
Ten years is long enough to make meaningful changes - but short enough that poor decisions become harder to undo. Every dollar deployed carefully during this decade has a disproportionate impact on the length and quality of your retirement run-way.
10 years out: work out where you actually stand
Around age 50, start by building a clear picture of your position. What do you own? What do you owe? How much is in super? What are you contributing? What other investments do you have? Many high-earning individuals hit age 50 and realize they have accumulated scattered products, but no cohesive strategy for how they will convert those products into an income stream.
8-10 years out: improve the foundations
This is often the time to tighten cash flow, review debt, make sure emergency reserves are adequate and understand whether your current savings rate is enough. If you are going to aggressively save, this is the window where compound growth still has a robust timeframe to act upon your capital.
7-10 years out: review super strategically
Check whether your super investment strategy, fees, insurance and contribution approach still make sense for your circumstances. Are you taking enough growth risk? Should you be transitioning to a balanced approach? Do you have expensive legacy insurance policies consuming your capital inside the fund?
5-7 years out: decide what to do with the mortgage
For many families, the mortgage is one of the biggest retirement questions. Do you want it gone before you retire? Can it realistically be repaid from cash flow? Would redirecting every spare dollar to debt create other missed opportunities? Clearing the psychological weight of a mortgage provides immense peace of mind entering retirement.
5 years out: model the retirement income
This is where the plan should become more concrete. Estimate your likely retirement spending, expected assets and potential income sources. We want to stress-test your portfolio against historical downturns to ensure your income isn't obliterated by a localized recession on the exact year you intend to stop working.
3-5 years out: start simplifying
Over time, families can accumulate multiple accounts, investments, properties, policies and financial arrangements. Before retirement, simplicity becomes valuable. Close redundant accounts. Consolidate stranded super. Offload troublesome investment assets that require too much mental overhead.
2-3 years out: prepare for the transition
Retirement is not just an investment event. It is a cash-flow event. Your salary stops, but the bills do not. Start thinking about how much cash you want available to fund the initial phase of retirement. Often we construct a 'cash wedge' buffer of 2-3 years of living expenses to insulate the core portfolio against early sequence-of-returns risk.
1 year out: know exactly what will happen
By the final year, you should understand your retirement date, expected spending, debt position, super strategy, investment income, cash reserves and any administrative steps required. You should have already filled out the paperwork, configured your account structures, and established exactly which bank accounts will receive your regular income payments.
Why the decade matters
The final 10 working years often combine strong income with a clearer sense of what you want. That creates an opportunity. Do not wait until retirement is two years away to ask whether you are ready. Use the decade to create options, reduce uncertainty and move into retirement with confidence rather than hope.
General information only: This article does not take into account your objectives, financial situation or needs. Before acting on any information, consider whether it is appropriate for your circumstances and seek professional advice where appropriate. Tax, superannuation and other rules can change, so current professional advice may be required.
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