Ask Noel

Ten years ago we invested in shares with the goal to have enough money for our children's education. We now have $150,000 in our share portfolio, predominantly geared towards gold stocks. Would we be better served investing in gold bullion or stay with the shares?

Ten years ago we invested in shares with the goal to have enough money for our children's education. We now have $150,000 in our share portfolio, predominantly geared towards gold stocks. Would we be better served investing in gold bullion or stay with the shares?

I much prefer shares as you have no problems with storage or insurance and they should be highly liquid while producing an income. Keep in mind you are heavily weighted towards gold and your portfolio will fall substantially if the price of gold does.

I'm a self-funded retiree with a spare $400,000 to invest. I have over $1 million in shares and property and want to use this extra cash to generate the best possible capital stable income. What would you recommend? My wife and I have no dependents and no debts.

Your best option is probably blue-chip shares paying high-franked dividends or else managed funds that have the bulk of their holdings in this area. Just be aware that they will bounce around when the market does but should give you good tax-effective returns in the long term.

I'm a 61-year-old retired woman with $450,000 in a self-managed super fund plus $300,000 cash. I own my own home worth $500,000. I want to buy another home, costing $600,000, before I sell my existing home. Would I be able to withdraw $300,000 from my SMSF and then put it back in when my existing house sells? Or will I have to get a home loan for the amount above $300,000 that I need to purchase the new home, including stamp duty, solicitors, removalist etc?

As you are retired you should be able to access your super when you wish and as you are over 60 the amount you withdraw should be tax-free. You are able to contribute money to super until you are 65 without passing any work test so there should be no restrictions on your recontributing the money when it becomes available. Bear in mind the non-concessional caps are $150,000 a year but you are allowed to use the bring-forward rule and contribute up to $450,000 a year. Involve your adviser as there are heavy penalties for making excess contributions.

I am 56 and have retired from full-time work. I want to move to Tasmania and buy a farm worth $1 million. What is the best ownership for tax purposes?

This is a matter to discuss with your accountant. If it is purely to be your residence, it is best to be in your own name to keep the capital-gains tax exemption, keeping in mind the main residence only applies to the dwelling and the surrounding land up to two hectares. If you intend to make it an income-producing property, and so claim the associated tax deductions, you will need to convince the Tax Office you are running a genuine business. In that case, the appropriate structure will depend on your family situation and what assets and income you will have.

I'm 43 and my wife is 41. I'm earning $250,000 and my wife is a full-time student. Our house is worth $420,000 and we owe $236,000. We have savings of $150,000. I'm interested in buying a better home for $800,000 and plan to rent out our current property. Would it be better to pay out the mortgage on the current property and then save for a deposit for another loan, or opt for a home-equity loan on the current property.

There are no additional tax benefits to be had by remortgaging the existing property, so I suggest you convert that loan to interest only to maintain your tax benefits once it is rented out. You should then focus all your resources on reducing the debt on the new residence quickly.

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