professionals & business owners

"I'm established in business, paying too much tax; it's time to make my money work smarter for me."

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You have an established career or business, a substantial income, a solid superannuation account and you’re paying some serious tax. Investigating options to build wealth, in a tax-effective manner, to maintain a high standard of living in retirement is something you need to consider as soon as possible.

Sarah’s Story

Sarah has worked tirelessly over the past 14 years to build up her marketing and communications agency.

A lot of time and money had been invested in the business to get it to a very profitable place. However her personal investment base wasn’t as solid as she'd like, as her business had consumed everything.

Admittedly she had bought a flash inner-city terrace home, which she had remodeled and paid off, but it was time to make sure her money could start working for her. Her tax bill was equivalent to what she paid one of her staff, as she was personally earning $450,000 a year from the business with minimal tax deductions.

Her superannuation was growing because she was putting in the usual 9% into a fund with one of the big brands. The super fund had its usual fluctuations and she wondered at times whether it would have been better to just put the money in a bank account. She never really had the time to review superannuation statements and any time she tried it was rather confusing.

She knew that she could eventually sell her business for a tidy sum, but it would be prudent to make sure she had some additional assets, outside of the business, in case something happened.

Sarah wanted $150,000 a year in retirement so she could travel extensively and maintain the standard of living she had come to enjoy. She knew that what she had would not be enough, and she would have to start taking action sooner rather than later.

Her accountant had been suggesting to her for quite some time that she should chat with DPN to investigate her options.

dpn’s solution

When Sarah finally made contact with DPN, she received a complimentary Property Accumulation Analysis, which included a retirement calculation, and she quickly realized that she would be desperately short.

She wanted to retire in 10 years time on $150,000 a year in today’s currency, and the analysis showed her she would need a portfolio of $5 million to achieve this goal.

Sarah had $550,000 in cash saved and $430,000 in superannuation. DPN conducted a number of illustrations showing her that by utilizing the cash she had, and ensuring she had a strong buffer just in case, she could accumulate between four to six properties over an 18 month period at around $450-$500k each, establishing a $2.5 million portfolio. She could also purchase two properties within a self-managed super fund with a combined value of $1 million, and a 60% loan, leveraging her superannuation money to maximize her returns over the next decade.

This was all done with her accountant's help, establishing trust structures for tax minimization, asset protection and the transfer of her wealth to her estate. Her contributions to super would allow her to pay off the properties in the next 10 years and their growth would go a long way to making up her shortfall, she was also more comfortable with the predictability of property than with the variability of her previous super account.

She could pay off $150,000 a year on her property portfolio of four to six properties, and the combination of the growth of those properties and the sale of her business would make it possible for Sarah to achieve her $5 million target.

what dpn can do for you

If you are doing well in business and need to consider how to make your money, tax and assets work harder and smarter for you, give DPN a call on 1300 713 318 or fill in the contact form below, for an obligation-free discussion to see how we can help accelerate your net wealth accumulation.