Finance

Over 60? These 4 financial moves might offer your best ‘return’ on investment

Published

4 hours ago

May 5, 2026

Over 60? These 4 financial moves might offer your best ‘return’ on investment

For people hurtling toward retirement, the standard personal finance advice is to continue to fund your retirement accounts as aggressively as you can, including taking advantage of catch-up contributions.

Those additional contributions can add up to a tidy sum in retirement, but after age 60, they have fewer years to compound, and the tax deferral isn’t as valuable. If your retirement numbers are in relatively good shape, however, consider these four spending strategies with a positive psychological payoff.

Strategy 1: Get ahead of big-ticket transactions

As retirement approaches, it’s helpful to forecast big-ticket outlays over the next two to five years, like home repairs or improvements or cars you’ll need to replace. If you’re still working, you can fund them out of cash flows rather than putting additional funds into your retirement accounts.

Pushing those big-ticket outlays into your working years has a psychological benefit. That’s because pulling money from your investment accounts can be fraught, especially in the early years of retirement, when you’re still getting your sea legs. That challenge can be especially acute for people who plan to delay Social Security; they’ll be drawing all of their cash flow needs from their portfolios in those years. Spending from working income is apt to be psychologically more palatable.

As you think through what you might want to spend on, lean into your vision of retirement. Will you pursue your passion for cooking? If so, splurging on new counters might be money well spent. If more road trips are in your future, lining up a safe, reliable set of wheels should be a priority.

Strategy 2: Pay down debt

The calculus on prepaying a mortgage usually boils down to which decision provides the better “return”: debt paydown (and the relief from the interest service that accompanies the debt) or investing in something that offers a similarly safe return.

It often depends on the prevailing interest rate environment. Today, many mortgage holders could reasonably earn more on their safe investments than they’re paying to service their debt. Consider liquidity and spending needs too. If  paying off your mortgage  would require you to crack into your retirement account and trigger a big tax bill, or leave you cash-strapped and less flexible in retirement, you’d want to think twice.

However, mortgage paydown is the ultimate “sleep at night” allocation, especially as retirement approaches, because it helps you skinny down your fixed expenses and adopt a flexible approach to your discretionary spending, which in turn can  boost your lifetime retirement spending. I’ve yet to meet a single person who paid off a mortgage and regretted it.

Strategy 3: Build up liquid reserves in a taxable account

You can put as much into your taxable account as you wish, and you can also pull as much out, without strictures. Being able to spend from taxable accounts with minimal tax implications provides the leeway to pursue other worthwhile strategies in the early years of retirement, such as converting traditional IRA assets to Roth, for example.

But don’t overdo your allocations to safer assets in your taxable account. Cash has a low return relative to other assets regardless of where you hold it. You might not even outearn the inflation rate! I like the idea of retirees holding no more than two years’ worth of liquid reserves—CDs, money market mutual funds, and so on—across both taxable and tax-sheltered accounts.

Strategy 4: Splurge

If you’re in your 60s, it’s a good bet you know loved ones who were struck down in the prime of their lives, before they really had a chance to enjoy their retirements to the fullest. So why not lean into the big, fun experiences that you’ve been “saving” for retirement while you’re still working and healthy?

As Jamie Hopkins notes in my book  How to Retire, the greater good in this case is that you’re continuing to work and earn an income, thereby forestalling portfolio withdrawals. If taking a few amazing trips a year or buying a vacation home now makes continuing to work more palatable and also helps you feel more comfortable with the splurges, then those allocations are well worth considering, even if they mean you have to pull back on your savings.

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This article was provided to The Associated Press by Morningstar. For more retirement content, go to https://www.morningstar.com/retirement.

Christine Benz is director of personal finance and retirement planning for Morningstar and co-host of The Long View podcast.

Finance

Homeowners dealt $3,200 hit as interest rates rise to highest level in 16 months

Published

16 hours ago

May 5, 2026

Press Room

Homeowners dealt ,200 hit as interest rates rise to highest level in 16 months

The RBA Board has handed down its latest interest rate decision. (Source: Getty)

The Reserve Bank of Australia has conformed to expectations and decided to lift the official cash rate. It is the third successive interest rate hike this year as the bank tries to suppress expectations of runaway price inflation in the economy and subsequent wage increases.

The RBA opted for a standard 0.25 hike, which takes the official cash rate to 4.35 per cent. After hikes in February and March, it now completely erases all the rate cuts following the hiking cycle in response to Covid-driven inflation.

The official cash rate last sat at 4.35 per cent 16 months ago.

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The hike in March was a close call, with five Board members in favour and four against. This time, it was a very different story.

Only one Board member voted to hold rates steady today, with eight voting for the hike.

“There are early signs that many firms experiencing cost pressures are looking to increase prices of their goods and services. Short-term measures of inflation expectations have also risen,” the RBA Board warned in its accompanying Monetary Policy Statement on Tuesday afternoon.

“Developments in the Middle East are having an impact on inflation. Higher fuel prices are adding to inflation and there are indications that this is likely to have second-round effects on prices for goods and services more broadly. This inflation impulse is in addition to the high inflation recorded around the start of 2026, reflecting capacity pressures in the economy.”

The RBA pointed to huge uncertainty in the Middle East and said a protracted conflict would mean inflation will likely get worse before it gets better.

“A longer or more severe conflict could put further upward pressure on global energy prices; this would push up near-term inflation and could also increase inflation further out as these costs are passed through,” it said, adding this scenario risks price rises getting “built into longer term inflation expectations”.

“Higher prices and prolonged uncertainty may cause growth to be lower in Australia’s major trading partners and also in Australia,” the statement said.

That confluence of factors has some economists worried about us entering into a period of stagflation.

Average mortgage holder paying $3,200 more

Today’s hike will take the average owner-occupier variable home loan rate to 6.26 per cent.

Finance

How Cultural Understanding Drives Grace Yee’s Life, and Career

Published

1 day ago

May 4, 2026

Press Room

How Cultural Understanding Drives Grace Yee’s Life, and Career

Why did you choose to attend Bentley?

I wanted to find a school that allowed me to combine both business and language.

I grew up working in my family’s restaurants in Western Mass., so I have been surrounded by business from an early age. As I got older and started working more intensely in this environment, I developed a real passion for the ins-and-outs of business.

On top of that, my grandparents are Chinese immigrants, so the Chinese culture has always played a big role in my life. Since I studied Mandarin Chinese starting in kindergarten, the ability to continue that at college was non-negotiable. When I toured Bentley, it all clicked and felt as though I’d be able to pursue all my interests to their fullest extent.

What stood out about the Language, Culture and Business major, and Finance minor?

What really drew me to Bentley’s Language, Culture and Business major was that it wasn’t just language studies — it also highlighted global perspectives and how to adapt to a highly globally connected business environment. At the same time, I was interested in the analytical and strategic side of business, which led me to the Finance minor.

Together, I believe they allow me to approach business problems and solutions from both a quantitative and human-centered perspective. My finance background gives me the technical foundation to analyze performance and then make strategic decisions, while Language, Culture and Business has helped me understand the people and environment that those decisions impact.

Are there specific Bentley professors or classes that helped you connect the dots between finance and culture?

Yes, several of the required courses for my Language, Culture and Business major really helped me understand how cultural context influences economic behavior, negotiation styles and decision-making. Pairing these skills with my finance courses allowed me to think more critically about how financial strategies play out in global markets and where cultural nuances can directly impact outcomes.

If I were to choose what course has impacted my choices the most, I would say Chinese for Business I (MLCH 201) and Chinese for Business II (MLCH 208) taught by Fei Yu, assistant professor of Modern Languages. I thoroughly enjoyed taking these courses because they made me realize that language can be applied to so many industries and made my aspirations to work internationally seem possible and within reach. I also gained important skills such as interview skills and resume skills.

At Bentley, there’s a strong culture of encouraging students to explore multiple interests and see how they connect for future careers.

Were there other campus experiences that helped blend your cultural and business interests?

Yes — being involved in organizations such as the Women’s Leadership Program and the Bentley Dance Team helped me work with diverse groups of people and develop strong interpersonal skills. Additionally, studying abroad in Florence, Italy, made me comfortable with change and sparked a new fire to continue learning about cultures other than my own.

Finance

Superannuation rule change could better manage economy: ‘Fairer and more effective’

Published

2 days ago

May 4, 2026

Press Room

Superannuation rule change could better manage economy: ‘Fairer and more effective’

Is there a better way than just the RBA? · Getty

It doesn’t seem to make a lot of sense, does it? Someone decides to go to war, the oil stops flowing, prices go up and our economy starts shutting down.

The best response we can come up with is to raise interest rates, to dampen demand a little more. As if doubling the price of petrol won’t do that enough.

Problem is, raising interest rates only hurts people with mortgages and renters, typically not high on the wealth ladder. People with no debt get more money, and will spend it. And the rising interest rates hurt the businesses that have already been hit. Just when we want to raise supply.

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Besides interest rates, standard macroeconomic thinking is there’s only one other lever. We could reduce net government spending, which is hard to do when you’ve just cut taxes on diesel and petrol, which will fuel demand just when you don’t want that to happen.

But there may be a third way. To our collective credit, Australia has set up what many regard as the world’s best superannuation system. As at December 2025, we had close to $4.5 trillion set aside for our futures. And, every hour of every day, 12% of our income is added to the pile.

It’s been suggested that the super guarantee levy might be used as the third ‘lever’ to modulate the economy, in addition to fiscal and monetary policy.

This was actually one of the arguments used when the levy was introduced back in 1992. Instead of giving workers a wage rise, which might trigger wage-inflation, Bill Kelty and Paul Keating negotiated a compulsory savings scheme. Workers would benefit, but not immediately.

Perhaps it’s worth revisiting that negotiation. Say you want to set the levy at 12% over the long term. When times are tough you might put the 12% rate down a little to stimulate the economy. Instead of a $100 wage and $12 in super, people get $102 for now and $10 for later. We get through.

Or, when inflation is running you might nudge the 12% up a little to constrain demand. The extra isn’t paid by business. Instead of the $100 wage and $12 in super, people get $98 for now and $14 for later. Given the cost of living crisis, maybe the lever only cuts in above a certain income.

This would arguably be fairer, easier and more effective than the interest rate sledgehammer. It would inject or remove the same amount of money from the economy. But the pain is spread, people keep their own money rather than paying it to the banks, and businesses aren’t hit by higher interest rates just when you want them to invest in their capacity.

It’s not a complete replacement for interest rate changes, but the three levers can be used in combination to manage the economy more effectively and more fairly.

This is just one of the ways that we might think a little deeper about Australia’s strategic stockpile of cash, without jeopardising its fundamental superannuation purpose.

Dr Ian Woods and Josh Dowse say we should go back to the conception of the superannuation system to think about better ways to fight inflation. · supplied

For example, super funds are designed to provide for the future, but are assessed on quarter-year returns. Yet private wealth may be oversold if our natural, social and human capital are being shredded in the meantime.

Perhaps our super can help address some of our most intractable problems. Take housing. In Europe, pension funds invest heaving in high-quality, long-term rental housing near city centres. Their returns are set-and-forget at a level compatible with their low long-term risk.

This doesn’t happen in Australia, but it might. About 30% of our super already sits in low-return, low-risk bonds, so a slice of that could create just the housing that Australia needs, with no downside to anyone in the picture.

It’s currently hard for a super fund to do this, as they compete on those quarterly returns. But to keep competition on an even playing field, what if all super funds were required to invest say 15% of its pool in the public housing and other infrastructure that our society needs.

Many would say that our super fund is just that – for super – and should not be meddled with. We would say the pool is now so large that it is already having unintended implications for our economy. And, that we need to draw on these funds directly because governments are no longer prepared to borrow or tax more for essential purposes.

And then there are those who say ‘That’s our money and you can’t say what it’s for’. To which we reply that we wouldn’t have it if our government hadn’t set up the scheme, and that we wouldn’t have so much without the tax breaks it offers.

So let’s give a little more thought to how we can best use this national wealth for national benefit. We have precious few other choices.

Josh Dowse and Ian Woods are the authors of ESG Unlocked: How successful companies and investors build our natural, social, human and financial capital.

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