The modelling tool I flagged a fortnight ago is now live and embedded in our Div 296 FAQ. Thanks to those who reached out with feedback on the preliminary findings — the version released to the sector goes further than what I originally scoped.

The tool doesn’t model a suggested withdrawal. It determines one. You set the parameters — member balance, age, portfolio profile, source fund type, personal tax rate, time horizon, and all the usual Div 296 inputs — and it works out the optimal withdrawal amount and the vehicle (or combination of vehicles) that maximises the member’s net wealth over the period. It runs a multi-stage search: first the best single-vehicle strategy across individual, company and insurance bond; then a mix sweep with a materiality threshold, which checks whether splitting the withdrawal across two or three vehicles produces a meaningfully better outcome than the best single vehicle alone. If nothing materially beats leaving the money in super, it tells you that too.

Headline features:

• Automatic optimisation of withdrawal amount and vehicle mix — the tool indicates the best strategy rather than asking you to nominate one
• SMSF or Large APRA-regulated fund source modelling, with the transitional inclusion factor applied correctly on the APRA path
• Cost-base tracking across all vehicles, so cumulative embedded gains are captured, not just current-year growth
• Year-one rebalancing CGT and transaction costs reflected in the starting position rather than glossed over
• Twelve pre-built portfolio profiles plus full manual override of gross return, income yield, growth and turnover
• Interactive charts comparing baseline (do nothing) against the optimised combined position, with a toggle between current-view and full-term range
• Full walkthrough mode showing every intermediate tax calculation, year by year

Two mechanical points worth calling out.

Firstly, for SMSF members, the year-one realisation event has a larger effect than most people anticipate. To fund a withdrawal, the fund must generate cash so, unless cash is already sitting idle in the portfolio, assets have to be sold down. That triggers CGT on the pro-rata realised gains before the money even leaves super. The optimiser models this honestly: the starting position of the alternative vehicle is reduced by the CGT drag on realisation, and that drag then compounds over the modelling period. For portfolios with meaningful embedded gains, the first-year hit can materially change — and in some cases entirely undo — the case for withdrawal.

Secondly, this is not an impediment for Large APRA-regulated fund members. APRA funds operate on a pooled unit-price basis with members continually moving in and out, so they always have cash on hand to meet a withdrawal request. No member-specific realisation event is triggered — the withdrawal is simply funded from the existing cash flow of the fund. That removes the year-one CGT drag entirely and meaningfully improves the optimiser’s output for APRA-source members relative to SMSF-source members holding the same portfolio.

The patterns from the preliminary findings still hold. First tier (between $3m and $10m) remains primarily a super wins story for most portfolio types – though a member with no external income may benefit from holding some investments personally – with the insurance bond taking only a narrow lead on cash-heavy portfolios. Second tier (above $10m) is where the insurance bond’s advantage becomes genuine across most portfolio types, except where restructuring costs and its inability to hold direct property become a dominant consideration. The company vehicle almost never wins at either tier due to its encashment tax position. The individual vehicle can outperform super for second-tier members over shorter horizons but fails over the long run at the top marginal rate.

What’s new is that you no longer have to work any of this out by hand. For any given member, the optimiser will tell you exactly what it’s chosen — a single structure, a split, or no withdrawal at all — based on the parameters you’ve set. You may find the results surprising. If you do, then check your parameters.

The tool is live in our Div 296 FAQ. I’d welcome feedback from anyone putting it through its paces.