Preparing for a Confident Retirement Transition
A recently semi-retired couple in their early 60s approached Focused Advisers with a clear objective: to confidently plan for full retirement within two years. With one partner returning to full-time employment for a final professional stint, and the other receiving a JobSeeker allowance due to medical constraints, they were seeking guidance on how best to manage the upcoming sale of their investment property, optimise superannuation, and ensure long-term financial security and flexibility.
While the couple had already laid strong financial groundwork - including owning their principal residence debt-free and selling an investment property valued at approximately $690,000 - they faced several complex questions:
- How should they invest the $670,000 anticipated proceeds from the property sale?
- Could they meet their targeted retirement spending of $60,000 per year, with an additional $35,000 annually for five years of travel?
- How might returning to full-time employment affect their Centrelink entitlements and super contributions?
- Were their super portfolios aligned with their desired risk profile?
- What tax strategies could they adopt to make the most of their renewed income stream?
Our Approach
We started by taking a comprehensive view of their current financial position, life goals, and timeline. Here's how we helped:
1. Clarifying Their Retirement Vision
We developed a 2-year roadmap aligned to their goals:
- Invest the property proceeds strategically.
- Ensure $35,000 remained liquid short-term for travel planning.
- Retire in 2026 with a predictable income stream for lifestyle and travel.
2. Superannuation & Investment Strategy
Both clients held superannuation balances over $300,000 each, and their risk profiles aligned with a balanced strategy. We:
- Rebalanced their super portfolios to match risk appetite.
- Explored salary sacrifice and transition-to-retirement (TTR) options to reduce tax and enhance retirement savings.
- Modelled scenarios to ensure income sustainability for the desired retirement lifestyle.
3. Centrelink Implications
We carefully assessed the impact of their return to full-time work on their JobSeeker and Health Care Card entitlements, while monitoring their eligibility over the coming months.
4. Liquidity and Tax Planning
Given their debt-free status and healthy asset base, we:
- Prioritised liquidity for travel and short-term spending.
- Structured investments for tax efficiency, particularly around capital gains from the property sale.
Outcome
Through a collaborative and tailored advice process, the couple now has:
- A clear two-year strategy to fully retire, with financial confidence.
- An investment plan for their lump sum that balances long-term growth and short-term liquidity.
- Reassurance that their super portfolios match their goals and risk comfort.
- Clarity on their Centrelink status and a plan to adjust entitlements as life evolves.
