Defining a New Financial Plan Post Separation to Balance Lifestyle and Retirement
Background: Meet Jenny
Jenny is a woman in her 50s going through a separation from her long-term partner. Together, they had built a strong asset base including property and shares, with Jenny set to retain the family home, which held significant emotional and financial value for her. As part of the settlement, her ex-partner would retain other assets, including a property, a larger share of liquid assets, and his business.
With her financial position changing significantly, Jenny wanted to understand what her future could look like, particularly how she could maintain her lifestyle and achieve her retirement goals.
Key Results at a Glance
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Retirement:Reduced her retirement age by up to 1 year.
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Tax Savings :Saved approx $5,208 per year through salary sacrifice
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Downsizing:Options available improved her ability to retire.
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Insurance:Covered for the event of her permanent disablement.
Why Did They Seek Advice?
- To understand her financial position post-separation.
- To assess whether she could retain her primary residence long-term.
- To determine her ability to transition to part-time work at 60 and retire comfortably.
- To evaluate the impact of career decisions (current vs higher income) on her future.
- To explore property options including downsizing or relocating in retirement.
Strategies Implemented
Retirement Strategy:
- Developed multiple financial scenarios based on different income levels and lifestyle choices.
- Assessed outcomes if Jenny remained in her current role versus moving to a higher-paying position.
- Identified that without increasing income, she may need to work until age 73, whereas a higher income could reduce this to age 69.
- Compared her current position (no changes) with a scenario where all recommended strategies were implemented.
- The graph below illustrates how her net financial position changes over time under both scenarios, highlighting the impact of our recommendations and supporting more informed retirement decisions.
Superannuation & Tax Strategy:
- Recommended implementing a salary sacrifice strategy, generating approximately $5,208 per year in tax savings.
- Redirected these savings toward her retirement fund to improve long-term outcomes.
- Enabled Jenny to retire approximately 6 months earlier through this strategy.
Property & Lifestyle Strategy:
- Evaluated multiple options including downsizing, relocating, or renovating a lower-value property.
- Modelled the financial impact of retaining her current home versus alternative housing strategies.
- Identified that retaining the home would require trade-offs in lifestyle or retirement timing.
Debt & Borrowing Strategy:
- Worked with a mortgage broker to determine Jenny’s borrowing capacity based on current and future income.
- Used this analysis to guide decisions around property retention and settlement structuring.
- Highlighted that without increased income, she may need to compromise her superannuation to achieve a fair settlement.
Insurance Strategy:
- Recommended appropriate insurance cover, ensuring her financial plan remained secure in the event of illness or injury.
- Provided peace of mind that her retirement goals would not be compromised by unforeseen circumstances.
Outcomes and Benefits
- Gained clarity on her financial position post-separation.
- Identified the trade-offs required to retain her primary residence.
- Improved retirement outcomes through $5,208 annual tax savings.
- Brought forward retirement by approximately 6 months.
- Developed a clear understanding of how income decisions impact retirement timing.
- Created a flexible plan aligned with her lifestyle and housing goals.
- Secured her financial future with appropriate insurance protection.
- Empowered to make confident, informed decisions about her next steps.
Key Takeaway
Major life changes often bring financial uncertainty, but with the right advice, they can also create an opportunity for clarity and control. Jenny’s case highlights how personalised planning can help navigate complex decisions, balance competing priorities, and build a path toward a secure and achievable retirement.
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Important Note
Produced with our client’s permission. Names within this case study have been changed to protect the client’s right to privacy. The content of this case study has been based on a real-life client. Any information provided here is general advice only and does not consider your objectives, financial situation or needs. This information should not be taken as comprehensive and does not constitute legal or financial advice. You should seek legal, financial or other professional advice before relying on any content. Yield Financial Planning is not responsible to you or anyone else for any loss suffered in connection with the use of this information. Information is only current at the date initially published.
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