Case Studies

SMSF Comparison* Example

John & Mary have:

  • A combined income of $160,000
  • Their employer contributes 9.5% SGC to their super
  • Their combined superannuation balance is $220,000
    They plan to retire at age 65 in 15 years

Option 1 - Retail Super

  • They invest into a balanced super fund with medium fees
  • ASIC projection estimates they will have $450,638 when they retire
  • Click here for Option 1 PDF for ASIC calculations

Option 2 - SMSF with Property Investment Analysis

  • They transfer $200,000 into a SMSF
  • They each leave $10,000 in their old super funds to maintain all their insurance entitlements
  • They direct their employers to make their super payments to the new SMSF
  • They purchase a $400,000 townhouse within their SMSF
  • Borrowing $249,000 (about 63% of the value)
  • Take out a 15-year loan at 6% so the property is paid off at retirement
  • Property Investment Analysis at 4% growth (1% above inflation) estimates their investment property is worth $720,000 when they retire
  • If they sell the property after they retire, they will pay no tax on the profit.
  • In addition to the Investment Property they have accumulated about $100,000 in cash.
  • Click here for Option 2 PIA calculations

In this example the Investment Property within a SMSF produces $273,000 more than the Balanced super fund; this is a 60% better outcome at retirement.

  • At 3% growth (= CPI) the property is worth $623,187
      • $173,000 more = 38% better outcome at retirement
  • At 5% growth (recent historical average) the property is worth $831,571.
      • $380,000 more = 85% better outcome at retirement

* A minimum combined superannuation balance of $220,000 is required.

Investment Property Example

Michael & Julie

  • $775,000 Home Loan with Big 4 Bank costing $3,200/month
  • 30 Year loan
  • $29,000 Car Loan costing $400/month
  • 5 year loan
  • Client 1 on $180,000 a year
  • Client 2 on job keeper

Phoenix Mortgage Consultants

1. Refinance and roll car loan into home loan at 2.2% – 2.4%

  • Saving $550/month
  • Reduces loan term by 6 years
  • Now 24 year loan

Phoenix Property Consultants & Phoenix Mortgage Consultants working together

2. Use Equity in Home for cost and deposit loan (interest only) for Residential Investment Property
3. Borrow 80% against Investment Property (interest only)

  • Note split loans (a bank would never do this)
  • Note interest only loan to maximise cash flow and allow home loan to be paid off sooner

Phoenix Property Consultants

4. Select a property specifically matched to the clients personal financial circumstances
5. Structure the property, loan, ownership, depreciation, rent yield to maximise income and minimise tax

  • Investment Property is Cash Flow positive by about $10,000 a year from day one
  • Reduce loan term by another 6 years
  • Now 18 year loan

Phoenix Property Consultants & Phoenix Mortgage Consultants working together

6. Client saves $400,000 in repayments (12 years at $3,000 a month)!
7. Client has created additional equity of $500,000 in the Investment Property over 20 years
8. Client is $900,000 better off with no additional outlay!