FIRE/wealth-planning. Sell London IP?
My partner (45F) and I (49M) are trying to work out the best way to structure our assets so that we can potentially retire early, or at least have the option for one or both of us to move to part-time/less stressful work.
We’re both Australian tax residents, moved to Australia in 2016.
Our current position:
London investment property: worth approx. £700k, owned outright in my name.
Currently rented, generating approx. $50k AUD/year gross rent
Family home in Australia: owned outright
Melbourne investment property: negatively geared, approx. $200k equity
Combined super/SMSF: approx. $800k
Son is currently in primary school and we’d like to send him to private school for high school.
Both working in corporate jobs, but increasingly concerned about job security and getting tired of the grind. We’d ideally like the financial freedom to retire early or take lower-paid/part-time work.
The London property is the big question.
I bought it in 2010 before moving to Australia in 2016, so I’m also trying to understand the Australian CGT implications if we sell. My understanding is that, the Australian CGT cost base may be based on the property’s market value when I became Australian tax resident, rather than the original UK purchase price, but I’d love to hear from anyone who has dealt with this.
We’re trying to decide between:
Would selling and diversifying make it easier to achieve FIRE/semi-retirement?
How should we factor in the cost of private schooling for our son?
We’re not necessarily looking for someone to tell us exactly what to invest in — we’re more interested in how people would approach the sell vs hold decision and whether we’re overlooking anything.