Looking at everything, and making smart decisions can ‘unlock’ plenty of untapped wealth. (Source: Getty)
When we first met Wayne and Wendy, they thought they were doing pretty ok with money.
In their late 30s, they were earning good incomes, saving at a solid rate each month, and already owned a home. They had some shares, stable jobs, and a growing investment mindset. Looking at their situation on paper, it looked like they were doing all the right things.
But behind the scenes, there was a lot of frustration and stress. They were paying a lot of tax, wanted a dream home that wouldn’t crush their lifestyle, and ideally wanted to create the option to wind back from work before they were too old to enjoy themselves.
They’d been thinking about making their next big financial move for almost two years while the markets kept running. They recognised that analysis paralysis was costing them money.
Wayne and Wendy were stuck because they thought their money was simple. But it wasn’t. Like many other strong earners, they had a tendency to collect ‘good ideas’ that never quite seemed to add up to an actual strategy.
And ultimately, that’s how many end up stuck – saving hard, paying plenty of tax, and still feeling like they’re not getting ahead. The fix here isn’t to get a hotter stock tip. It’s a plan that connects your savings, debt, tax, super, and investing to the lifestyle you actually want.
Once we mapped Wayne and Wendy’s full picture, a clear pattern emerged. They were doing a lot of good things, just not in the right order, under the right structures, or with the right system behind their financial moves. Fixing that sequence unlocked some serious money.
The first thing that came through was that they’d been investing in Wayne’s name, even though his income and tax rate was higher. Shifting the ownership immediately cut their annual tax bill by around $3,000.
Their super fund was another drag. Higher fees and underperforming investments meant their overall return was lagging. Moving to a better, lower-cost super option added another $3,500 each year. Wayne was underusing an employer share plan, so with a few small tweaks to how they participated and when they sold, they picked up another $4,200 yearly.
On the tax front, they hadn’t been contributing funds up to the tax deductible contribution limit in super, missing out on a straightforward $3,900 tax deduction. And outside super, they didn’t have any tax structures in place – by setting up an investment bond, they capped the tax on their investment fund earnings at 30%, with the added benefit that capital gains are tax free when investments are held for ten years or more. This added another $6,000 to their bottom line in year one.
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