Ask Paul: We want to retire comfortably - what's next?

Dear Paul,

I had to leave work due to medical injury for a few years but hopefully will return in the next year or two. I am 49 and my wife is 51.

I own two investment properties in Sydney, valued at $500,000 and $400,000 - both are paid off. I have a mortgage on another of around $450,000. 

I own my own house and have a Vanguard fund valued at $250,000. My wife and I have about $250,000 each in superannuation. 

My question is: what's next? We want to retire comfortably but do not have a date in mind.

What else can we do to increase our wealth and not live on the pension? We have a 15-year-old dependent daughter. - Michael

Given my ancient status as I edge towards 70, touch wood, I am in excellent health. I suspect this is more genetic than much of an effort on my part, but grateful that my wife and I are well.

Very sorry to hear about your medical injury, but pleased to hear you can return to work in the next year or two.

Frankly, I think you have done most of the work on your money already. You are a great example of generating wealth while you are young. Who knows what will happen to any of us as the years go by.

I can see you own a home, have about $1.6 million in investment assets and a geared property with, I imagine, some equity.

Just looking at the $1.6 million, that would comfortably provide you with more than $60,000 a year for many decades. I don't see a pension coming into play for you unless you lose a fair bit of what you have made!

As you return to work, it is really just a matter of how much in the way of savings you want to add to your wealth.

If $60,000 a year is enough for you to live on, I reckon you are already there. If you need more, then of course it is worth adding savings to your super and other investments.

I appreciate I am sounding pretty sanguine about your money situation.

But that is thanks to the wealth you have built at an early age. Even better, you are well diversified across property, super and shares with Vanguard. From here most of your choices are about how you wish to lead your life.

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