How can I retire now I

Discussion in 'Financial Independence, Retire Early (FIRE)' started by sue Casey, 26th Jan, 2021.

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  1. jaydee

    jaydee Well-Known Member

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    If the above figures are correct, the solution would seem pretty simple to me...........

    Sell assets in CIP/SMSF to release enough funds to clear mortgage on PPOR.

    Keep at least $100k under the mattress (figuratively speaking) and close SMSF and transfer remaining funds to Australian Super or similar (no more accounting fees or compliance costs on SMSF). Upgrade the car, do any small home renos or upgrades and make any gifts to you children now (ie. 5 years before pensionable age) with the mattress funds.

    Then continue working as long as you wish. At 67 you will qualify for a full or part pension depending on how much you spent back when you were 62.

    Then live happily ever after whilst receiving a pension supplemented by the returns from your super fund (eg 7% on $470k =$32.9k). That is pension plus $32.9k plus all associated benefits.

    Plus your assets (home and remaining funds) are still available for passing to your kids when you pass on via your will.

    Keep it simple as we need less complications as we get older.
     
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  2. sue Casey

    sue Casey Member

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    Thanks Jadee excellent plan, I am going ahead with putting CIP on the market.
     
  3. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    What is the net equity the sale will realise eg ex-GST, selling costs, CGT and after discharge of the loan ? Its always wise to consider real numbers before acting.
     
  4. JohnPropChat

    JohnPropChat Well-Known Member

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    @sue Casey you'll benefit from some professional advice. @Paul@PFI is a tax wizard, why not give him a buzz to at least talk it through.

    Is the CIP in Pension phase? There could be options here.
     
  5. Kr@mer

    Kr@mer Well-Known Member

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    What’s your plan if commercial property becomes vacant?
     
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  6. spludgey

    spludgey Well-Known Member

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    I don't know, I kind of disagree. Selling an asset that gives you a 5.6% net yield plus capital growth doesn't sound like the best solution to me. In the current climate, that's a very decent return.

    I would suggest the option that skater brought up of getting a job for long enough to get a loan. Or getting a job that's one or two days a week for the next 7 years. Those seem like the best available solutions to me.
     
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  7. sue Casey

    sue Casey Member

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    Hi thanks everyone , I have sold it, for $750,000 will have $520,000 after paying mortgage and other costs, no cgt or sales tax from smsf .I'm reading a book by Nick Bruining about retiring. Don't panic more reason why you don't need $1 million to retire.
    This feels like the right move for me , I was very ready to leave work.
    Still think I can make money though from my nest egg. I love property....so maybe some in a property and some in a super fund....
     
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  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Is this the book Sue?
    Don't Panic

    I just ordered a copy, sounds good.
     
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  9. sue Casey

    sue Casey Member

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    Hi yes that's it very informative
     
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  10. spludgey

    spludgey Well-Known Member

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    I reckon before you do anything else, speak to a good mortgage broker on here and see if there's any chance to refinance!
    Even if it was at 4% with a non bank lender, you'd still be better off than selling your cash cow, in my opinion. That's if you're fairly confident in having a tenant in there.
     
  11. jaybean

    jaybean Well-Known Member

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    Let me know what you think, I'm trying to help my parents with retirement planning.
     
  12. sue Casey

    sue Casey Member

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    Hi yes that's it I am finding it very helpful, well presented and informative, well worth reading
     
  13. MangoMadness

    MangoMadness Well-Known Member

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    Its good, I found the examples at the end of the book the most informative showing how the pension isnt 'all or nothing' and how different asset levels can still ensure a part pension and access to pension card advantages etc.

    One of the most eye opening examples was (from memory) a couple spending $10k on a holiday is reducing their assets by $10k and therefore entitled to around $600 more/year in pension so effectively the holiday is like a 6% term deposit :)

    I read a copy in the SA library system, so it could also be available in other states without purchasing.
     
  14. pippen

    pippen Well-Known Member

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    How many pages????
     
  15. Lacrim

    Lacrim Well-Known Member

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    Don't invest. Rely on the Govt. Got it.
     
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  16. oasis1frog

    oasis1frog Well-Known Member

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    Saw a company selling Property Plan, start investing now by year 2047 can "comfortably" living off an retirement income $50k p.a., I think I will wait few more years to get the age pension with guaranteed cpi and all the benefits !
     
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  17. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Spruikers and vested parties such as agents will tell you anything but cant project property prices or value. Storm financial was a one-way asset and wealth growth plan and failed when share prices didnt rise. They fell. Why do they always spruike the asset and not the debt >? One of them is fixed and the other can rise and fall. (The loan is fixed).

    The $2.5m of assets in 2047 will produce $50K in 2047 which wont buy much at that time. Its like this Australian pizza hut menu from 1978
    [​IMG]

    and the one from just two decades later
    [​IMG]

    You will have the $$$ to buy a $1.40 pizza but it costs $14.
     
  18. MangoMadness

    MangoMadness Well-Known Member

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    Learn the game, play the game, use the rules to your advantage or the government will take advantage of you.
     
  19. MangoMadness

    MangoMadness Well-Known Member

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    google says 155, not a heavy read at all
     
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  20. MTR

    MTR Well-Known Member

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    Yes, most will