Retirement planning case study

/Retirement planning case study
Retirement planning case study2018-09-14T15:22:28+00:00

– Pre-retirement to Retirement Planning
– Strategic and Investment Advice
– Establishing a Self Managed Super Fund

Our client had recently engaged Rob Douglass to provide accounting strategies. While they had a very good business, some properties, some super and some insurances all in place, there was a lack of overall cohesion to bring these together into a plan that would nurture their pre-retirement and retirement goals. We spent time exploring their values and goals, financially and for the broader family, to set an overall plan and direction that worked for Nick and Pam’s retirement, their business, and their sons, in the business succession plan.

The key outcomes were:

  • A Self Managed Super Fund to consolidate their super accounts and move one of their commercial properties into the SMSF.
  • Cash out and re-contribution of existing retail super to potentially save $76,000 tax paid via the children when they are both deceased.
  • SMSF transition to retirement pensions to save them approx $37,000 pa in current tax paid on property rent, land tax and existing super accumulation accounts.
  • Confirming via detailed pre-retirement projections and the significant annual tax savings in the plan, that they no longer needed Life, TPD and Trauma insurances and thus saved more money ceasing insurance premiums.
  • Identifying that they weren’t selling the business at the price required & their sons working in the business couldn’t afford to buy it off them. Creating the idea for a ten year transition to their sons, to enable Nick and Pam to be rewarded for the value of the business via 10 years profit and also allowing a great family succession transition of the business to their sons.
  • Ongoing SMSF tax deductible contributions to reduce tax on business profit distributions & tax free SMSF pensions providing more than enough income to support their desired retirement lifestyle.

As a result:

  • They have a very clear retirement plan that is maximising their assets and tax effective SMSF pension structures to significantly assist in paying for their retirement incomes.
  • They are very much enjoying retirement knowing that their plan is well set and regularly reviewed and adjusted as required to changes in their situation, superannuation laws and investment markets.
  • They have had been able to remove themselves from daily activity from the business but still feel secure that they can oversee the operations and finances as required to ensure their 10 year transition profit is protected. Their sons have significantly stepped up to run the business in a great way, earning themselves profit bonuses as managers of the family business. The family succession is proving very successful, especially considering the alternative of selling to a 3rd party, which they tried for several years.

Please more information regarding these strategies, please contact Adam Passwell or David Howells.

Related link: Testimonial