For Australians approaching retirement, recent market volatility may feel like more than just a bump in the road.

Unlike younger investors, who have time on their side, retirees don’t have the luxury of waiting out downturns. A sharp dip just before, or as you begin drawing down your superannuation, can leave lasting damage.

It’s not just about watching your super balance dip.

The real danger comes if you need to start withdrawing funds during a slump. Doing so can lock in losses and make it harder for your remaining savings to recover. The timing of poor market returns is known in finance circles as “sequencing risk”. And it can shorten the life of your retirement savings.

What’s going on in markets?

So far in 2025, global shares as measured by the MSCI World Index have fallen 4.6%. Concerns over stubborn inflation and trade tensions that will hurt growth are keeping investors on edge.

If your superannuation is in a “balanced” option, with diversified investments in stocks, bonds, private markets and cash, your balance will have fallen by less than this amount.

Zoom out and the story looks better. Over the past year, total returns for the MSCI index remain strong, up 6.5%.

It’s a reminder that downturns are often followed by rebounds. We saw this during the COVID crash in 2020, when markets plummeted, only to recover more than 50% over the following year.

Still, for those nearing retirement, the timing of these dips matters more than the averages. Uncertainty makes planning all the more crucial.

Is your super still in high gear?

Many Australians don’t know exactly how their super is invested. Most people are in default “balanced” or “lifecycle” options, which automatically shift from high-growth assets like shares to safer investments like bonds and cash as retirement approaches.

This design helps cushion your balance from big market hits as you near retirement. But if you’ve chosen a high-growth option or haven’t reviewed your investment settings in years, you could still be heavily exposed to volatility.

In that case, now’s the time to consider your options:

• delay retirement by a year or two to give your portfolio time to recover
• move to part-time work instead of retiring fully, reducing how much super you need to draw down
• review your budget. You can’t control the markets, but you can control your spending plans.

Don’t panic – reacting emotionally can cost you

When markets fall, it’s natural to feel the urge to switch your portfolio mix from stocks into cash. But this can turn temporary losses into permanent ones.

Instead, consider more measured steps. Transition-to-retirement strategies let you draw a partial income while keeping most of your super invested.

Annuities – which offer guaranteed income for life or a fixed term – are another option. Newer products also address longevity risk, which is the risk of outliving your savings.

What does a 5% drop really mean?

Let’s say you’re 65 and have a super balance of A$200,000 (for men, that’s roughly the median; for women, it’s lower due to factors like lower lifetime earnings and career breaks).

A 5% fall translates to a $10,000 loss. That might not seem huge, but if you were planning to draw down 5% of your balance annually – about $10,000 a year – that loss could effectively wipe out an entire year’s retirement income.

It doesn’t stop there. If left invested, that $10,000 could have continued to grow. Over a 20-year retirement, and assuming a 5% annual return, that $10,000 could have grown to over $26,000.

For retirees with smaller super balances or higher withdrawal rates, the impact of a market dip can be even more significant.

Many experts now expect long-term returns to be more modest than in recent decades. Ageing populations, climate change and shifting global dynamics are likely to weigh on growth.

This makes it even more important to avoid switching entirely into cash, which can erode your savings through inflation over what could be a 20- or 30-year retirement.

A smarter path to retirement

The best approach is to gradually shift your investments in the years leading up to retirement – not all at once in response to a market dip. Lifecycle options do this automatically, but if you’re managing your super yourself, it’s worth getting advice.

Your super fund’s website likely offers tools and calculators to help. ASIC’s MoneySmart retirement planner is another great resource. And don’t underestimate the value of calling your fund to ask:

• How is my super invested?
• Does this match my age and risk tolerance?
• What are my options if I want to make changes?

The bottom line

Retiring in a volatile market isn’t easy, but panic isn’t a plan. By understanding your investment mix, taking advantage of flexible retirement strategies, and seeking advice when needed, you can navigate uncertainty more confidently.

Planning for retirement isn’t about avoiding all risk – it’s about managing it. With the right tools and mindset, you can stay on course, even when markets wobble.

Source: https://theconversation.com/markets-are-choppy-what-should-you-do-with-your-super-if-you-are-near-retirement-255017

Stay up to date with what’s happened in the Australian economy and markets over the past month.

Wars in Europe and the Middle East, volatile oil prices and shifting US policies are making headlines – but failing to dampen market optimism.

The ASX closed the financial year with a near 10% return – its strongest since the COVID-19 crisis and despite US tariff threats.

Despite tariff risks for the US economy, the S&P 500 index surged to a four-month high on hopes of future rate cuts and smooth trade negotiations.

Click here to view our update.

Please get in touch on 03 9723 0522 if you’d like assistance with your personal financial situation.

Suite 2, 1 Railway Crescent
Croydon, Victoria 3136

Email: integrityone@iplan.com.au

Telephone : 03 9723 0522

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This information is of a general nature and does not take into consideration anyone’s individual circumstances or objectives. Financial Planning activities only are provided by Integrity One Wealth Advisers Pty Ltd (ABN 35 994 727 125) is a Corporate Authorised Representative (1316489) of Integrity Financial Planners Pty Ltd (AFSL 225051). Integrity One Planning Services Pty Ltd and Integrity One Accounting and Business Advisory Services Pty Ltd are not liable for any financial loss resulting from decisions made based on this information. Please consult your adviser, finance specialist, broker, and/or accountant before making decisions using this information.

A broad-based rise in housing values over the quarter

Housing values gained momentum across almost all markets over the three months to end of May, largely due to rate cuts. Buyer confidence is increasing thanks to the cash rate reductions in February and May, coupled with optimism that more rate cuts might be on the horizon.

Australian dwelling values increased by 1.3% over the quarter, with broad based gains meaning that every capital city recorded a rise of at least 0.5%.

Despite the momentum demonstrated by the quarterly figures, the pace of annual gains nationally slowed to 3.3%. This represents the slowest annual change since the year ending August 2023.

A rebound where values were the weakest

The rise in property values over the quarter continues to be led by the lower ends of the market, with Darwin recording the highest quarterly increase of the capitals with a 4.3% rise.

However, it should be noted that some more expensive market segments are starting to accelerate in response to rate cuts.

Regional markets are also demonstrating a positive trend, recording a rise in values of 1.6% over the past three months.

Tarif announcements and a lead up to the election knocked confidence

Household confidence slipped in April, with the US’s ‘Liberation Day’ tariff announcements and the lead up to the Australian federal election also causing uncertainty.

Positive factors supporting growth

The main factor boosting buyer confidence and the volume of property sales is the widespread expectation that interest rates are set to reduce further as the RBA appears to be becoming more comfortable with the path of inflation. Confidence that inflation will remain within the target range is crucial for interest rates to continue to reduce.

Some renewed confidence in household decision making after the federal election is also likely to support further price growth, with enhanced policies to support first home buyers announced.

The housing undersupply is also playing a role in supporting demand. Recent figures show commencements moving in the wrong direction, over the December 2024 quarter, holding below the decade average. Additionally, the barriers for building more homes remain substantial, with construction costs rising through the March quarter.

Downside factors

There are also factors at play that will keep housing values in check to some extent. Affordability pressures are anticipated to constrain housing demand and lower population growth should also help to quell the accrual of housing demand in the absence of an increase in supply.

It is anticipated that the factors supporting growth will outweigh these and housing values will continue to post modest rises.

Dwelling values over the quarter

Melbourne

The Victorian capital posted a 1.2% quarterly move according to Cotality (previously Corelogic) figures, taking the city’s median dwelling price to $791,303. Investors should take note that the gross rental yield figure for Melbourne is 3.7%.

Sydney

In the three months to May’s end, Sydney experienced a dwelling value change of 1.1% resulting in a median of $1.203 million. The gross rental yield for the Harbour City remains the lowest of the capitals at 3.1%.

Brisbane

The Queensland capital has again recorded the second most expensive spot for dwelling values at $917,992 and a quarterly rise of 1.6%. Brisbane has recorded a gross rental yield of 3.7%.

Canberra

The national capital recorded a rise of 0.5% during the quarter with the median now sitting at $855,663. For Canberra, the gross rental yield is 4.1%.

Perth

Perth prices increased 1.6% over the quarter, taking its medium to $813,810. Perth recorded 4.3% gross rental yield.

For more information about how you might be able to purchase a property in the current market, get in touch with us today.

Note: all figures in the city snapshots are sourced from: Cotality national Home Value Index (May 2025)

If you have any questions or need any information please give us a call on 039723 0522.

Stay up to date with what’s happened in the Australian economy and markets over the past month.

There was a sigh of relief all round when the Reserve Bank lowered interest rates in May by 25 basis points to 3.85%.

Markets largely recovered from April’s losses during the month as US President Trump’s stance on trade softened.

However, the legal and economic uncertainty of US tariffs remain a key concern for global and local markets.

Click here to view our update.

Please get in touch on 03 9723 0522 if you’d like assistance with your personal financial situation.

Suite 2, 1 Railway Crescent
Croydon, Victoria 3136

Email: integrityone@iplan.com.au

Telephone : 03 9723 0522

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This information is of a general nature and does not take into consideration anyone’s individual circumstances or objectives. Financial Planning activities only are provided by Integrity One Planning Services Pty Ltd as a Corporate Authorised Representative No. 315000 of Integrity Financial Planners Pty Ltd ABN 71 069 537 855 AFSL 225051. Integrity One Planning Services Pty Ltd and Integrity One Accounting and Business Advisory Services Pty Ltd are not liable for any financial loss resulting from decisions made based on this information. Please consult your adviser, finance specialist, broker, and/or accountant before making decisions using this information.

If you’ve been dreaming about owning your first home, the outcome of the 2025 federal election could bring some welcome news. A number of housing policies that were announced during the lead-up to the election, and aimed squarely at first home buyers, are now set to go ahead. Some changes are enhancements to existing schemes and others are new initiatives by the federal government.

These initiatives are designed to make it easier to break into the property market—whether you’re just starting to save or already house hunting. Bear in mind, these are federal initiatives and there is also a lot of support provided at the state level that’s worth investigating.

So, let’s look at what’s on offer.

The continuation of the Help to Buy program

One of Labor’s centrepiece housing policies is Help to Buy, a shared equity scheme allowing eligible Australians to buy a home with a deposit as low as 2 per cent, with the government contributing up to 40 per cent of the property price (new builds) or 30 per cent (existing homes).

Expansion of the First Home Guarantee Scheme

One of the most immediate and impactful changes is Labor’s expansion of the First Home Guarantee Scheme, which is set to begin 1 January 2026.

This program allows eligible first home buyers to purchase a home with as little as a 5 per cent deposit. The government acts as guarantor on the remaining 15 per cent, meaning buyers don’t need to pay Lenders Mortgage Insurance (LMI)—a cost that can run into the tens of thousands depending on your loan size.

Previously, access to this scheme was limited by income thresholds and regional property price caps, which meant some buyers in larger cities or with slightly higher earnings were left out. Labor has now expanded the eligibility requirements, making the scheme available to a broader group of Australians. Now, there is no cap on income and depending on the state you are buying in, price caps have been lifted.

This change is especially helpful for buyers struggling to save a 20 per cent deposit in high-price markets like Sydney or Melbourne, where even modest homes can require huge upfront deposits. With just 5 per cent needed, many buyers will be able to get into the market sooner.

New homes being constructed for first home buyers

One of the more ambitious commitments from Labor is a plan to build 100,000 new homes for first home buyers. Backed by a $10 billion investment, these homes will be constructed on under-utilised government-owned land and delivered in partnership with state and territory governments to reduce red tape and fast-track approvals. Construction for these projects is expected to start between 2026 and 2027, with buyers moving in from 2027 to 2028.

The goal is not just to help individuals, but to increase overall housing supply—a key factor in addressing Australia’s affordability crisis. These new homes are intended to be priced affordably and reserved specifically for eligible first-time buyers, reducing competition with investors and repeat buyers.

While full eligibility criteria are still being finalised, it’s expected that buyers may need to meet certain income limits to ensure the homes go to those who need help the most.

If you’re currently planning ahead rather than buying immediately, this initiative could provide an opportunity down the line to secure a home at a more affordable price point than the general market.

A $1,000 tax deduction

A smaller, but still helpful measure is the introduction of a $1,000 annual tax deduction for work expenses starting in the 2026–27 financial year. This will automatically apply when taxpayers lodge their tax return, without the need to apply separately or fill out extra paperwork.

A brighter outlook for first-time buyers

If you’re thinking about buying your first home, now’s a good time to start planning. With fewer restrictions, expanded eligibility to access government support, and new housing stock on the way, the landscape is starting to improve.

Of course, it’s still important to be realistic about what you can afford and get solid financial advice, but with these opportunities in play, home ownership may be closer than you think.

There is a lot of government support on offer and determining the most appropriate for your situation calls for expert advice, so come and have a chat to us about whether any of these grants could help you to buy your first home.

As the federal government moves to introduce a new 15 % tax on superannuation earnings above $3 million (known as Division 296 tax), concerns and debates have emerged about the broader implications for investment strategies, retirement planning, and even the property market.

It is intended that once passed by Parliament, the new tax – which doubles the tax rate from 15 per cent to 30 per cent for balances that exceed $3 million – will apply from July 1, 2025.

The tax change is expected to directly affect less than 0.5%  of investors or around 80,000 people.

Treasurer Jim Chalmers describes the increase as “a modest change” that will make “concessional treatment for people with very large superannuation balances still concessional but a little bit less so”.

He says it will help fund other priorities such as Medicare, cost-of-living relief and tax cuts.

The Grattan Institute says tax breaks on super contributions cost the federal budget nearly $50 billion in lost revenue each year.

The Institute says that, while super is intended to help fund retirement, it has become a “taxpayer-subsided inheritance scheme”. By 2060, Treasury expects one-third of super withdrawals to be as bequests – up from one-fifth today.

How will the rate be calculated?

The formula for the additional tax payment due calculates the difference between the member’s total superannuation balance for the current and previous financial years and adjusts for net contributions (which excludes contributions tax paid by the fund on behalf of the member) and withdrawals.

An earnings loss in a financial year, can be carried forward to reduce the tax liability in future years.

The calculation of earnings includes all unrealised gains and losses.

Implications for investors

The Grattan Institute says taxing capital gains as they increase removes incentives to “lock in” investments. “But it can create cash flow problems for some self-managed super fund (SMSF) members who hold assets such as business premises or a farm in their fund,” the Institute says.

Many commentators speculate there will be a major change to asset allocation in super, particularly in SMSFs, as a result of the move to tax unrealised gains.

Meanwhile, one property analyst predicts a structural shift in property investment with commercial real estate becoming more attractive because of its stronger income yields relative to capital growth.^v

The new tax could also reduce the appeal of super as an inheritance tool with investors likely to explore alternative wealth transfer methods.

Navigating the changes

With the tax changes looming, we’re helping clients to ensure their portfolios will continue to meet their expectations.

For those looking to minimise their exposure to the tax, there are a number of strategies that may be useful.

These include:

1. Diversifying investments outside of superannuation by, for example, making direct investments in equities, bonds or private businesses.
2. Considering alternative retirement savings vehicles such as family trusts.
3. Actively planning to optimise tax efficiency by, for example, structured withdrawals to keep balances below the $3 million threshold, making use of tax exemptions and considering asset reallocation.

The new tax marks a significant shift in Australia’s retirement savings landscape. While the government argues that the measure is modest and targeted, its long-term implications—particularly the taxation of unrealised gains—could reshape investment strategies for high-net-worth investors.

For those nearing retirement with a high super balance, careful financial planning will be essential and all investors who could potentially be affected, should be reassessing their portfolios and weighing up whether alternate wealth management strategies may be an option.

Please get in touch if you would like help to navigate the changes.