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I am 66 and my wife is 63 and we both work

I am 66 and my wife is 63 and we both work

part-time and contribute to super. She is on a transition-to-retirement pension in her fund and I receive the minimum compulsory pension from mine. We intend to set up a self-managed superannuation fund (SMSF) in a couple of months. I am not allowed to put $450,000 from my savings into my fund as a non-concessional contribution, as I am over 65. However, I can put in $150,000 on June 30 and another $150,000 in July. Am I able to give my wife $150,000 from my savings so that she can make a non-concessional contribution to her fund, and then in a couple of months roll her super and pension and mine into that SMSF?

You can give your wife as much money as you wish and she can choose to do with it what she wishes she will be subject to her own after-tax contribution cap, which for her is $450,000 over three years. However, she cannot contribute to an account that is in pension mode the non-concessional contribution will have to be made to a separate accumulation account in her name and then rolled back over to commence a pension.

If a husband and wife die together and leave the contents of a large superannuation to be divided among various relatives, what sort of tax would the government impose on super funds left to the beneficiaries? What is the best way to minimise this tax?

The taxable component of superannuation left to non-dependants for tax purposes incurs a tax of at least 16.5 per cent and could be 31.5 per cent for lump sums that are the proceeds from life insurance cover held within super. The best way to eliminate it is to establish a binding death benefit nomination (subject to the super fund trust deed provisions) that effectively allows you to bypass the will and nominate a specific beneficiary that is a dependant for superannuation purposes. Alternatively, if you are 60 or older, you could withdraw the superannuation tax-free prior to death and place the money in the bank where it can be handed-on under the terms of the will. If you believe there may be arguments over the estate, seek advice about placing the money into insurance bonds in the names of the individual beneficiaries.

I'm 21 and have $100,000 to invest but don't want to take out a loan. I've been looking at several options including vacant blocks of land, student-accommodation apartments and shares. Please help me by providing some general advice as to how best to invest this money.

You would be pushed to get any quality real estate for $100,000 so I suggest you go with shares. They can be bought and sold in small quantities and require no ongoing maintenance. Another benefit is you can use quality managed funds if you aren't confident in making the decisions yourself.

My girlfriend and I have saved $200,000 in cash (sitting in a 6 per cent interest savings account) and have a share portfolio of $50,000. We have a combined income of $120,000. We are still relatively young at 22 and 23 however, we would be looking to move out of home to live together in the next year or two. Given our capital availability, we have the option of buying or renting. However, we don't know what would be best from a taxation perspective and an investment perspective.

Congratulations on what you've achieved to date you're obviously very good money managers. Just keep in mind that a fundamental investment principle is that you choose an investment on the qualities of that investment and treat any tax benefits as icing on the cake. I see no problems with you buying a property together, if you intend to live in it, but you are the only people who can decide whether you're better off to buy a property, or rent and invest what you save by renting.

We are a couple, both aged 58, with a gross income of $120,500 between us. We are frugal and cover our living expenses well but to find cash to visit family overseas is difficult. We have less than $10,000 in the bank for cash flow. We own a nice house in a quality estate, as well as a five-acre block. The house is worth $500,000 with a mortgage of $365,000. The mortgage payments are $1125 a fortnight. The block is worth $180,000 with a mortgage of $132,000. The mortgage payments are $900 a month. It was bought with the idea of using it as a base to retire to and to travel Australia from. That is, a long-term lifestyle investment rather than a passive-income investment. Does it make financial sense to sell the block and free up the $900? We enjoy visiting occasionally but it is at a price.

This is a lifestyle investment and, as you point out, there are probably better uses for $900 a month than paying off the land. Unless you believe it has strong growth potential, I agree it's better to relinquish it.

Advice is general readers should seek their own professional advice.

Contact noel.whittaker@whittaker Follow him on Twitter: @noelwhittaker. Questions to: Ask Noel, Money, GPO Box 2571, Qld, 4000, or see /ask-an-expert.

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