Portfolio Management
Case Study 2
Mr Y, originally from Australia has been living and working overseas for four years. Although his main aim is to return to Australia , he does not anticipate doing so in the forseable future. He has recently sold his property in Sydney , realizing AUD 500,000. As he is fairly risk averse he is currently holding this in an 30 day notice savings account earning 6%.
Having met with an MONTPELIER portfolio analyst he was interested in the fact that he could earn a significantly better return by investing in non equity/fixed interest investments which carry minimal risk.
MONTPELIER constructed a portfolio with a view to generating 8% - 10% per annum with minimal risk within an offshore wrapper. The funds that were available to him bear no correlation to equity markets and will continue to grow regardless of whether markets are rising or falling.
One of his primary concerns was that of tax under the Foreign Life Policy/Foreign Investment Fund legislation in Australia . This may mean that some tax may be liable upon repatriation. However, with the correct planning this tax can be mitigated entirely by restructuring the portfolio in the form of an offshore employer funded superannuation scheme.
This can be set up with fairly short notice and will save hundreds of thousands longer term.
