Question
Your client Annie is 59 years old and has recently been retrenched and paid $240K. She has a mortgage of around $1 million for two
Your client Annie is 59 years old and has recently been retrenched and paid $240K. She has a mortgage of around $1 million for two properties with a term of 26 years. Her super balance is $560K. Her mortgage interest rate is 5.54% per annum and her return on her super is currently 7.8%% per annum over the past 30 years and she is invested in AustralianSuper's Balanced investment option. The properties are rented out and she is earning a rental return of 6% per annum. The properties are valued at $3 Million in total. She lives in one property worth $1.6million and rents the second property out to a renters. So close to retirement she is uncomfortable with her debt situation, and more so now that she has been retrenched.
Question:
Should she pay the $240K towards her mortgage, sell the investment properties or add to her super? Justify your answer.
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Mortgage Annie has a mortgage of around 1 million with an interest rate of 554 per annum If she pays off the mortgage she will no longer have to make ...Get Instant Access to Expert-Tailored Solutions
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