If you’re aged between 45 and 60, own your home, and are starting to think seriously about retirement, here’s the good news. You may be wealthier than you think. And now is the time to act.

Many Gen X Australians have built up significant equity in their homes, often without realising the full potential of that wealth. If your mortgage is less than half your property’s value, you’ve reached a tipping point. It’s time to look beyond bricks and mortar and start building a diversified financial future.

Diversify beyond the family home

Investment property is a familiar next step, but it’s not always the most strategic. Property can be illiquid, expensive to transact, and overly dominant in your portfolio. A more balanced approach might include:

  • Shares and managed funds for liquidity and yield
  • Fixed interest and cash assets for stability
  • Listed property for exposure without the overhead.

For example, a $1 million residential property might yield around $30,000 annually before costs. A diversified investment portfolio could return closer to $40,000 after costs, with the added benefit of access to your capital when needed.

Superannuation: your tax-efficient wealth engine

Super remains one of the most powerful tools Gen Xers can use to build retirement wealth. Maximise your concessional contributions, currently up to $30,000 annually, and consider catch-up contributions if your balance is under $500,000 as of 30 June 2025.

For someone earning $180,000, an extra $8,000 contribution could save $3,120 in tax. That’s a 39 percent return. The long-term goal is to build your super to $2 million per person, or $4 million as a couple, which can generate a tax-free income of $200,000 annually from age 65.

Strategic use of debt

Debt can be a powerful tool when used wisely. Whether through margin loans or debt recycling strategies, leveraging equity in your home to invest in liquid assets can accelerate wealth creation. But it’s essential to:

  • Avoid overextending
  • Ensure repayments are manageable
  • Prioritise repaying debt before retirement.

Property isn’t always the best fit for retirement income. It’s lumpy, illiquid, and harder to draw from consistently.

Free cash flow

For higher-income earners, regular contributions to an investment portfolio using free cash flow can be a game- changer. Monthly investments build momentum, and the income generated can support lifestyle goals such as private school fees or travel, without touching capital.

Start with your end goal. If financial independence means drawing $200,000 annually, you’ll need $4 million in investable assets. That’s your freedom number. Once you reach it, work becomes optional.

Protecting wealth across generations

Inheritance planning isn’t just about wills. It’s about legacy. Testamentary trusts can protect family wealth, offer tax advantages, and ensure assets are distributed according to your wishes.

Early conversations around powers of attorney, enduring guardianships and succession planning, especially for business owners, can prevent future strain and secure long- term family wealth.

Once an inheritance is received, the priority should be to eliminate non-deductible debt and maximise super balances. From there, build investment wealth outside super to maintain flexibility and control.

Positioned for success

While Gen X may not have had the same tailwinds as the Baby Boomers, many are in a strong financial position. With the right strategy, including diversified investments, smart use of super, and open family conversations, this generation can shape a retirement that is secure, flexible and fulfilling.

The key is to start now. When it comes to financial independence, time and intention make all the difference.

Lindzi Caputo is an adviser of HLB Mann Judd Wealth Management (NSW) Pty Ltd (AFSL 526052). This content contains general advice which does not consider your particular circumstances.
You should seek advice from HLB Mann Judd Wealth Management (NSW) who can consider if the strategies and products are right for you. Information based on historical performance is often not a reliable indicator of future performance. You should not rely solely on historical performance to make investment decisions.