For Rainer, 59, and Stacy, 58, retirement is fast approaching, but the couple are worried about handling their investments themselves. Here’s how their licensed financial adviser helped them to plan and manage their retirement finances without the stress.
Rainer and Stacy bought a commercial property as an investment 10 years ago and have been renting out the property ever since. They like the tangible aspect of bricks and mortar but want to diversify their options to grow their wealth and generate a comfortable income in retirement.
To start planning for their retirement, Rainer and Stacy spoke to their licensed financial adviser about increasing their property portfolio. Their commercial property had done well for them, but it required ongoing maintenance, and their return was offset by costs such as rates and maintenance fees.
Taking their preference for property into account, their adviser recommended Rainer and Stacy diversify their property holdings through investment funds. Their adviser also recommended the couple open a self-managed superannuation fund and use available contribution caps to acquire the commercial property, which satisfies the definition of business real property, from Rainer and Stacey. Their adviser was also aware that Stacy in particular, was committed to, and interested in managing their self-managed superannuation fund and had enough knowledge and time to commit to the ongoing compliance requirements.
Alongside their original commercial property, they rolled over their existing superannuation into the SMSF. The SMSF was then able to invest in a range of real estate assets to diversify the couple’s income options in retirement. The assets include investments into:
With the assistance of their adviser, Rainer and Stacy are also investigating other investment options, such as managed funds and shares, to diversify and further spread the risk across their portfolio.
The couple are delighted that they’ve been able to create a property investment portfolio that will provide them with income in retirement without requiring them to manage the properties themselves. “With the help of our adviser, we now have control of our future through the SMSF, and most of all we’ve invested where we feel most comfortable — in property,” Rainer says.
Getting the right advice on your investments can have a significant impact on your retirement finances — and your stress levels. Listed below are some tips to take the hassle out of property investment.
