Pre-Retirement Case Study
|Salary||$120,000 p.a.||$80,000 p.a.|
|House||$800,000 with $120,000 mortgage|
|Children||Chloe age 22, Isabel 18 and Oliver age 25|
|Insurance||Adequate general & personal insurance|
- 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 planning, 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.
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Dr Craig McDonald