WHERE he was at – In the past, Peter had been a professional and worked in major corporations on large infrastructure projects, but always wanted the freedom of financial independence by working for himself and building up assets that returned an income, such as residential property. His property portfolio was doing OK, and he preferred being the property manager to handle repairs and maintenance, collection of rent, etc. But learning of the tax benefits both in accumulation and then the tax-free phase of pension mode, raised his awareness of the potential superannuation held. Being pro-active and a hands-on guy, a self-managed super fund (SMSF) made sense, and the opportunity to invest in property and other assets choices made it even more appealing!
What he WANTED to have – Peter was aiming to be self-funded in retirement – to not even consider a Government pension as an option, as the likely-hood in Australia is looking grim with our lack of enough workers to support our ageing population at present. He knew he needed to have enough after loans re-paid, to live modest to comfortably – he didn’t need a lavish lifestyle.
What it will COST – Since he didn’t have family or children, his cost of living was very low, and that had helped build his investments even after he left his professional career. He estimated $30,000 would be comfortable for his life.
What he would NEED – A self-confessed seminar junkie, he had been to many financial and business courses and workshops and knew the sums – at a conservative return of 5%, (one 20th of 100%) this meant requiring at least 20 times the comfortable income aimed-for – the min would be $600,000 in assets. This was well below his current property value of between $1-1.5 million. But to be sure, he did not want to rest on his laurels and planned to build 3-4 times the required asset value – to build a huge buffer in case something went wrong in one area/asset. It was wise. He had a meeting with his advisors and our financial planner to be clear he was thinking straight and if there was anything else he need to consider.
Having been to a property seminar with professionals to set up SMSF and new ideas that looked at alternative property investment such as options, he had the plan started. However what should have been straight forward was drawn out for the SMSF, and looking at other investment ideas such as continuing the share and Forex skills he had gained in other courses, was not encouraged or supported.
Since met Paul Humphreys at a business training weekend, and engaging him for doing his business accounts and books, exposed him to the SMSF work his firm also offered via SuperBenefit. Peter went to Paul’s seminars about SMSF and found some holes in the service and lack of support he was receiving, but also liked the methodology of the share selection process the broker produced, as well as the SuperBenefit approach to offering other professionals and their services in property, etc. There was a more supportive and dynamic environment that appealed.
What to do NOW – Having attended our seminar on SMSF which explained the administration and compliance requirements relating to SMSF, I refreshed him about how SMSF was set up, his compliance responsibilities and what we would do – obtain the Trust Deed, AND, TFN and have a bank account papers set up ready for him to sign. He had a friend who would be co-trustee, but he would be the only member. He had been very pleased so-far with the support for his many questions, and that other investment ideas could be pursued in the future such as property. While he was flat-out with his current business, he just wanted to be able to know he had a team helping look after the super side and over-all plan for retirement.
Peter now had the components in place –
Strategy – To take control of his retirement plan, and contribute extra, as he could in time
Structure – With SuperBenefit to handle the compliance of SMSF with peace of mind, and REAL service support
Support – With resources and all compliance taken care of by SuperBenefit, and other professionals in our network, he could focus to learn more about investment in property & shares later on. He felt his team was coming together!
Note – This is a simplified summary of one client – we recommend asking for a FREE consultation and/or seeking further professional advice with our recommended advisors or your own.
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