We tend to talk a lot about property on this Podcast, but the aim of property investment is to give you the financial freedom that leads to life choices.
The truth is that your superannuation balance is unlikely to be sufficient to cover your desired living expenses in retirement, and it's possible that by the time you choose to retire, the government will have changed the superannuation laws.
Today, I discuss superannuation funds with independent financial adviser Stuart Wemyss, director of Prosolution Private Clients, including the possibility of an additional stream of income that he calls a third super fund.
So prepare to ease your retirement fears, as we dive into the nuances of a third super fund and navigate the shifting government rules around superannuation.
We'll also examine what you might need to maintain your living standards in retirement, and the average super balance you should aim for at retirement.
As Stuart and I discuss today, your financial freedom in retirement may depend on thinking beyond the traditional super fund.
Here's a rundown of the key themes we explored:
- The consideration of an additional “super fund.”
- Some people may want to retire early, while others may want to slow down but not retire, and everyone needs to have enough to fund their desired lifestyle in their retirement years.
- A “third superfund” may be the answer to meeting these various challenges
- The average super balance in retirement, and whether that’s sufficient.
- Setting up an investment company
- You can only put so much in a typical superfund, and this strategy allows you to set more aside
- The importance of diversifying retirement investments
- Dealing with capital gains tax in a company structure
- The benefits of investing in shares and property within a company structure
- The benefits of trusts
- The need to understand market trends and behaviours.
- The usefulness of professional help in financial planning
Learning more about the nuances of planning for retirement empowers you to design the life you want with the financial freedom you need after retirement.
With the right knowledge and strategies, financial freedom is not a far-fetched dream but an achievable goal.
By understanding superannuation, diversifying investments, and adopting a successful investor's mindset, one can navigate the complexities of the financial world.
Links and Resources:
Stuart’s Book – Rules of the Lending Game & Investopoly
Some of our favorite quotes from the show:
“Basically, the government wants us to be self-sufficient in retirement. It doesn't want us to go on the pension, so it has a vested interest to a degree to ensure that we've got some funds for our golden years.” – Michael Yardney
“But if you're hoping to end up with more than what you can accumulate in superannuation and understanding the rules may change it could be worth considering and getting advice about which entity to purchase other investments in.” – Michael Yardney
“Where does all this negativity come from? Well, science has an answer. It's called the negativity bias and this is the idea that evolution has made organisms much more switched on for threats than opportunities.” – Michael Yardney
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