John is 57 and recently left his job in the South Australian Government. He had just over $1 million in a Super SA fund and a small balance in his new employer’s super fund and wanted to know his options. Should John consolidate the two super funds into one, and if so, what are the implications? Alternatively, should he set up a Self-Managed Super Fund (SMSF) and invest in a property?
The recommendations appeared complicated by the tax issues within the Super SA fund and whether John should pay the lump sum tax now or stay in the fund and defer the tax until retirement.
We provided both options to John and detailed projections to show him the outcome at retirement under each strategy. These options gave him the information he needed to make an informed decision, and he set up an SMSF. We introduced him to an accountant to set up the SMSF, and John purchased a property through his new fund. We then assisted with the remaining funds he had left after the property purchase and have now established an ongoing relationship with him.