Planning for the Future


I have a question about planning for early retirement. My husband is 40 and has reached his super cap, earning $240,000. I’m self-employed, 41, and earn $60,000 – 100 per cent of my earnings are paid off our home loan in addition to $4000 a month from my husband’s salary. We’ve recently bought an investment property which costs $4000 a year, and owe $200,000 on our home.

We’re looking to invest in another property next year, as well as managed funds. We’d like to ease back on work in eight years, when we’ve finished paying school fees and paid off our home. What would you recommend as the best investment strategy for early self-funded retirement/semi-retirement? We seem to be disadvantaged by paying extra into super, and also don’t want access to super to be restricted if the rising pension ages also affects the age we can access super in the future. I believe we have enough time to take some managed risks, and would like diversification of managed funds and property, but don’t know what the split should be.


You have raised a number of complex questions and really should be talking to a good financial adviser. The adviser should carry out a risk assessment to discover your tolerance for risk, and then help you devise an asset allocation that is in line with your risk profile and your long term goals. You have a very large exposure to residential property now, and my belief is that you should be focussing on diversifying into good share based investments when investing for the future. This should include both local and international shares. You can get tax benefits, and keep money outside super, by simply borrowing for investment. If you take a mortgage against your home to buy shares, you should not be faced with margin calls.

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