We would like to retire and to own a property outright. What is the best way to achieve this?

Q.

My partner and I are 58 and 51 years of age. We have $1.2 million in super, all currently in cash, with two different managers. Our incomes are $80,000 and $40,000 per annum. We have $450,000 in other investments, but no property as we rent. Due to ill health we would like to retire and to own a property outright. What is the best way to achieve this?

The person who is 58 could retire immediately and access their super, but until they reach age 60, the taxable portion withdrawn over $145,000 would suffer an exit tax of 16.5 percent. Of course by drawing out $145,000 plus the non taxable component, you could achieve a hefty deposit but you would need to take into account the fact that you could not borrow as much as you have become a single income family. Once you have no employer making superannuation contributions for you, you could progressively cash in the investments outside super, and eliminate the capital gains tax by making tax deductible contributions to super. I have no doubt things will be fine if you take advice before acting.