Individuals
Wealth Accumulation
IIn the earlier years of their career, possibly with children and a mortgage, the key focus of advice for iindividuals building wealth is on:
- Structuring your income streams in a way to ensure tax is being legally minimised
- Managing cash flows to ensure any surpluses are used to reduce personal debt
- Using surplus cash flows and tax-efficient debt to invest in non-superannuation assets
- Considering the appropriate ownership structure to protect wealth from litigation
- Ensuring that superannuation contributions are invested in long term investments consistent with your appetite for risk
- Protecting your current income and future wealth by implementing appropriate risk insurance strategies
- Implement basic estate planning strategies that protect your partner and children
Pre-Independence
At this stage of life an individual is generally within five years of achieving financial independence. Our advice will focus on:
- Comparing the desired income required in retirement with the potential income from your existing accumulated wealth, and identifying strategies to close any potential income shortfall
- Reviewing debts to ensure that personal debt has been eliminated and the level of tax-efficient investment debt is reduced to a level that can be serviced when you cease to work
- Reviewing the legal ownership structure for your accumulated wealth to determine its appropriateness for when you reach financial independence
- Updating estate planning strategies and insurances needs to reflect your current wealth and family circumstances
- Structuring your income streams in a way to ensure tax is being minimised
Financial Independence
An individual that has achieved financial independence is defined as having sufficient financial resources available to do what they want to do rather than what they have to do. Key areas of advice may include:
- Structuring your income streams, including pension income streams, in a way to ensure tax is being legally minimised
- Modifying the asset allocation of your investment portfolio from accumulating long term wealth to generating reliable income streams and protecting wealth
- Structuring your estate planning affairs to transfer your wealth to the next generation in accordance with your wishes, whilst being conscious of tax implications
Businesses
Start-up
Starting a business for the first time can be daunting, JDFA can assist a new business owner. Consider the following issues:
- What is my business strategy?
- What is my business plan for implementing my business strategy?
- What will my cash flow requirements be, and how will I finance any shortfalls?
- Which tax structure will best suit my business needs now and into the foreseeable future?
- Will I be able to satisfy the ATOs Personal Services Income requirements to enable income splitting?
Established
This phase is the longest period, sitting between the Start-up and Exit Strategy phases. Many of the issues faced during the Start-up phase continue to be relevant, however, new issues for consideration could include:
- How do I take my business to the next phase: organic growth or acquisition?
- How do I value another business that I am considering buying?
- How do I structure remuneration for staff to attract and retain the best people?
- Do I re-invest surplus funds into the business or consider diversifying into other assets?
- Does my tax structure protect me from my creditors or litigious clients?
Exit Strategy
The ability for the business owners to exit the business they have built on their terms requires forward planning, sometimes as much as 5 years. JDFA can help you consider the following issues:
- Do I sell to existing staff or external parties?
- If I can´t sell it, can I sell parts of it, or do I wind it up?
- What are the tax implications for each option?
- Can I reduce my future tax liability using the Small Business CGT Concessions?
- What do I do with the after tax proceeds from the sale of the business?