Case Studies

Karen

SMSF

Karen is 53 years old proprietor of her own business as well as the director and sole shareholder of the company. She has a self-managed superannuation fund (SMSF) of which she is a trustee with her adult daughter. She owns her business property in her SMSF and her business pays rent of $26,556 to her fund for the property. She receives a salary of $75,000 from the company as well as dividends, which are fully franked, of $60,000 per annum. Her home is unencumbered. Her SMSF borrowed some money to fund the property purchase.

Karen’s Specific Needs and Objectives

• She wanted to maximize the wealth to be created from her income streams and existing assets
• She was unhappy with past investment returns and management of her SMSF
• She wanted to repay her SMSF debt as soon as possible
• She also wanted to use tax effectively and save more for her retirement at age 65
• She wanted a plan to fund her future retirement income needs and regular financial projections to ensure her strategies were working towards these objectives.

Outcomes

• Recommendations on appropriate structures to hold her assets for wealth creation, flexibility and income.
• Reviewed risk profile of Karen and made new investment recommendations based on this profile to assist in achieving better returns in the future.
• Included advice on future contributions to be made to her SMSF to increase her retirement savings pool.
• Repaid debt owing from the business property purchase
• Reviewed existing insurance cover and advice on appropriate levels of cover for her future needs.
• Ensured her estate plan was updated to reflect her current wishes including consideration of taxes paid by her children upon her demise.
• Karen felt more comfortable about her retirement plans and future and felt a sense of ease that she would be able to achieve these goals and retire as planned.