Case Study: Strategic Wealth Acceleration for Yiota and Andrew

Client Profile

Yiota (47) and Andrew (48) are a dual-income household earning a combined $225,000 p.a., with three dependent children in secondary school. Their annual living expenses total approximately $110,000 net, excluding mortgage repayments of $34,000 p.a., leaving a surplus cash flow of $33,500 p.a. available for strategic financial planning.

Initial Assessment: Underutilised Potential

Yiota and Andrew’s superannuation portfolios were structured with a conservative-to-balanced allocation, comprising:

• 38% in cash

• 50% in growth assets

• 12% in bonds

This allocation was generating approximately 4.9% p.a. in total returns (3.11% income + 1.8% growth). While this may suit individuals nearing retirement or with low risk tolerance, it was misaligned with their actual profile:

• They are in their late 40s, with a 15+ year investment horizon

• They have stable income, surplus cash flow, and a moderate-to-high risk tolerance

• Their objective is to maximize retirement savings, not preserve capital

Key Limitations of the Original Strategy

1. Excessive Cash Holdings a 38% allocation to cash significantly reduced growth potential and exposed the portfolio to inflation erosion.

2. Passive Investment Structure Their existing portfolio lacked mechanisms to automatically reinvest dividends and income, limiting compounding benefits.

3. No Integration with Contribution Strategy Contributions were not actively deployed into growth assets, reducing the effectiveness of new capital inflows.

4. Limited Tax Efficiency Without a coordinated salary sacrifice strategy, they missed opportunities to reduce taxable income and redirect savings toward wealth creation.

Strategic Recommendations and Implementation

1. Portfolio Reallocation to Growth-Oriented SMA

Andre recommended transitioning to a professionally managed Separately Managed Account (SMA) with:

• 85% allocation to growth assets

• 15% allocation to bonds and high-yielding cash

• Target return: 8–8.5% p.a.

This SMA structure offers:

• Active management with dynamic rebalancing

• Automatic reinvestment of dividends and income

• Efficient deployment of ongoing contributions

This contrasts with passive investment vehicles, which often lack reinvestment mechanisms

2. Super Contributions and Tax Efficiency

Yiota and Andrew committed to $15,000 each in annual salary-sacrificed contributions, resulting in:

• $3,500 each in tax savings

• $7,000 total redirected into mortgage repayments

These contributions were made via pre-tax salary, enhancing retirement savings while simultaneously reducing taxable income — a dual benefit that improved both short-term cash flow and long-term wealth accumulation.

3. Mortgage Restructuring

Their existing mortgage of $350,000 was held at 5.95% interest, with monthly repayments of $3,000. Following a referral to Wealth Effect Group’s mortgage broking team, they refinanced to 5.25% p.a. and increased repayments to $4,500/month (inclusive of surplus cash flow and tax savings).

🏡 Outcome:

• Original loan term: 30 years

• New loan term: 11.3 years  

• Interest saved: $114,000  

• Years saved: 18.7 years

4. Insurance Review and Efficiency Gains

A comprehensive review of their group insurance held through super revealed inefficiencies. By transitioning to personally underwritten cover, they achieved:

• Annual premium savings of $5,800

• Improved policy structure and coverage

• Premiums funded via superannuation, preserving personal cash flow

This structure also enhances portfolio efficiency by reducing out-of-pocket expenses and allowing more surplus income to be directed toward strategic goals.

5. Estate Planning

Given their family structure and dependents, Andre facilitated the establishment of:

• Wills and enduring powers of attorney

• Binding nominations within super

• Referral to a specialist estate planning partner

This ensures their assets are protected and distributed according to their wishes, with minimal administrative burden on their children.

Projected Outcomes at Retirement (Age 65)

Individual	Starting Balance	Annual Contribution	Projected Balance @ 8% p.a.
Yiota	$220,000	$15,000	$1,343,838
Andrew	$160,000	$15,000	$1,030,967
Combined	—	—	$2,374,805

Summary of Strategic Impact

✅ $2.37M projected super balance by retirement

✅ $114,000 interest saved on mortgage

✅ Mortgage paid off 18.7 years early

✅ $7,000 annual tax savings redirected to wealth building

✅ $5,800/year saved on insurance

✅ A complete estate plan to protect their family.

Yitoa & Andrews case is quite typical and illustrates the value of integrated financial advice — combining investment strategy, debt management, tax efficiency, insurance structuring, and estate planning to deliver measurable, long-term outcomes.

Stay Informed. Seek Advice. Adjust Your Strategy.

Before implementing any financial strategy, it’s essential to consider your personal circumstances. What works for one person may not be right for another — and that’s where tailored advice makes all the difference.

At Wealth Effect Group, I specialise in helping clients take control of their retirement planning, investment strategies, and overall financial wellbeing. If you’ve found value in the insights shared here, imagine what we can achieve together in a one-on-one consultation.

📍 Based in Melbourne, with offices in the Gold Coast, I’m here to guide you through the complexities of financial planning with clarity and confidence.

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