Smart Strategies for Building Wealth
Retirement is an exciting life stage—but preparing for it can feel overwhelming, especially during uncertain economic times. Markets can be volatile, and while this can cause concern, there are smart strategies that can help you continue building wealth safely and effectively.
As your trusted financial planning team, we want to guide you through your options so you can approach retirement with confidence.
Preparing for retirement during volatile market conditions –
Start with the Safer Strategies
If you are nearing retirement, the first step is often to save more. Australia’s Super Guarantee rate of 12.5% will not be enough on its own. Experts suggest you should save at least 15% of your salary over your working life to build sufficient retirement wealth.
Other important early steps include:
- Spending less now and planning for more modest future expenses. Reviewing your current budget and your retirement lifestyle goals can reveal areas where you can cut back without sacrificing quality of life.
- Working a little longer, even part-time during the early years of retirement. This can significantly boost your financial position and reduce the pressure on your investments.
Seek Higher Returns – With Care
Another way to build wealth faster is by seeking higher investment returns. However, taking on more risk may not suit everyone close to retirement. Done thoughtfully and with professional guidance, though, this approach can improve your retirement lifestyle.
Why You Shouldn’t Abandon Shares
Despite short-term market swings, shares have historically delivered higher long-term returns than cash or fixed interest investments. This extra reward is known as the equity risk premium, which has typically added 5–7% per year above safer assets.
While shares may experience sharper declines during volatile periods, selling in a downturn can lock in losses. Staying invested gives your portfolio the opportunity to recover and grow over time.
Some boutique fund managers, who run smaller and more flexible portfolios, may offer better opportunities during uncertain times by focusing on strong returns irrespective of broader market conditions.
Consider Riskier but Rewarding Assets
To accelerate wealth-building, you might also consider allocating a portion of your portfolio to higher-growth assets:
- Smaller companies or those in emerging markets often offer faster growth potential compared to traditional blue-chip investments.
- Higher-yielding fixed income investments may provide better returns than traditional bonds, although they carry higher risks.
Of course, thorough research is essential. Identifying quality opportunities—and avoiding overly speculative investments—is key to success.
Active Asset Management Can Help
Smart investing also involves having the right managers on your side. Skilled fund managers with strong research capabilities and effective systems can uncover underpriced opportunities across countries, currencies, sectors, and asset classes.
Absolute return funds, which aim to deliver positive returns in both rising and falling markets, can offer valuable stability and growth potential within your retirement portfolio.
However, it’s important to carefully assess investment fees, as high fees can erode returns over time. At Continuum Financial Planners, we rigorously evaluate the cost-effectiveness of any investment recommendation.
Talk to Us Before Making Decisions
Before making any changes to your investment strategy, it is essential to seek professional advice. Each investor’s needs, goals, and risk tolerance are unique.
The adviser team at Continuum Financial Planners has the experience and skill to guide you through the process of preparing for retirement during volatile market conditions. We are here to help you create a tailored, secure, and rewarding financial future.
To arrange an appointment with one of our team –
- Phone us today at 07 3421 3456, or
- At your convenience, use the linked Book A Meeting
(This article was first posted by us in our September 2022 eNews. It has since been refreshed and posted to our website during April 2025.)
