Pre-Retirement Case Study
Client situation:
| Situation | Bob | Jane |
|---|---|---|
| Age |
58
|
53
|
| Salary |
$120,000 p.a.
|
$80,000 p.a.
|
| House |
$800,000 with $120,000 mortgage
|
|
| Shares |
$15,000
|
$55,000
|
| Super |
$320,000
|
$160,000
|
| Health |
Good health
|
|
| Children | Chloe age 22, Isabel 18 and Oliver age 25 | |
| Insurance |
Adequate general & personal insurance
|
|
Our Advice
- Ascertain desired spending requirements in retirement.
- Ascertain whether Bob and Jane want to preserve capital during retirement (so that capital can be transferred to their children and/or grandchildren).
- Determine ideal retirement ages, including semi-retirement.
- Determine likely investments - including their capital and income characteristics - to determine retirement income.
- Taper personal insurance as their retirement nest egg increases.
- Consider pre-retirement strategies such as Transition to Retirement Superannuation Pensions, spouse superannuation contributions splitting etc.
- Consider wealth creation through gearing. If a strategy of gearing is adopted, determine whether it should be within or separate to superannuation and if a mortgage reduction strategy should be utilised.
- Tax minimisation, including considering establishing a family trust and placing more funds into superannuation.
- Superannuation salary sacrificing.
- Estate planning, including superannuation assets which do not form part of a person’s estate, Enduring Powers of Attorneys, medical directives, etc.
