Aussie FIRE listeners are nothing if not curious. In this episode, Dave and Hayden answer a fresh round of questions from the community that range from tactical to philosophical. What do you do if most of your wealth is trapped in super but you want to retire early? Should you use property as a springboard into shares, or stick to index funds from the start? When is it worth restructuring your assets for tax benefits, and when is it more trouble than it’s worth?

Along the way, they tackle debt recycling strategies, partner income splits, lifestyle inflation, and even the implications of a potential war with China. The conversation blends theory with hard-won personal insight, making it an useful listen (or read) for anyone on the path to Financial Independence.

Balancing capital gains tax with debt recycling benefits

One listener wants to know whether it’s worth selling down a large share portfolio to pay off a mortgage for the purpose of debt recycling . Dave explains that it depends heavily on the size of the embedded capital gains and your tax bracket.

"You're going to need to pay capital gains tax on those shares," he says. "The amount you're going to be up for is going to depend entirely on how much capital gains are embedded in that big parcel of shares you're going to sell."

Debt recycling can lead to thousands of dollars in tax savings every year, especially for high-income earners, but the upfront tax cost may or may not be worth it. Dave encourages listeners to run the numbers using tools like Sharesight or with an accountant.

Hayden agrees and adds, “It's really just going to come down to: how much is gained? How big is the mortgage? How long are you going to keep it before you pay it off?”

They also caution against running afoul of the ATO’s wash sale rules.

“You just need to be able to reasonably show that it wasn’t a wash sale," Hayden explains, referring to an instance in which someone sells assets at a loss, and then re-buys similar assets to claim a tax loss. "Often, that kind of sell-out event is a great opportunity to change what you're invested in because it’s advantageous.”

Planning for worst-case scenarios: war and portfolio risk

A more left-field question asks how investors should protect themselves if a major geopolitical event like a war with China were to erupt. Hayden admits he’s thought about it before, but doesn’t dwell on it.

“It’s such a nuanced, complicated thing," he says. "The only broad answer I'd have to any of this is make sure you have a diversified portfolio .”

Dave echoes that sentiment: “Wars tend to be a lot worse for human life than they are for markets.”

He adds that the most practical way to insulate a portfolio is to stay diversified and avoid overexposure to one country, especially your own.

Trying to predict or plan for every future risk, Dave says, “is going to lead to me investing in a fearful manner, and it's going to lead to a pretty suboptimal result over the long term.”

Property as a short-term tool before switching to shares

One listener asks about using property to build equity quickly through leverage before selling and investing in shares long term. Dave agrees that property can be a useful tool, especially early in one’s investing journey: “You definitely have potential to make higher returns from property because of the leverage.”

But he also offers a reality check. “It’s not just pure upside with property… you’ve got stamp duty, buyers agents' fees, ongoing negative cash flow, selling agents' fees, and then capital gains tax at the end,” he explains. And because property markets can stagnate or fall, there’s no guarantee of short-term success.

Hayden adds that many who boast about making money in property may have simply benefitted from timing.

“There is no part of me that thinks that a $3 million duplex brick building is going to go to $6 million in 10 years,” he says. “That’s just my view… but I do want to stress that again, I don’t own investment properties.”

Both agree that while property can work, it's far from guaranteed, and success heavily depends on the timing, location, and broader market cycle.

Who should hold the income-generating assets?

Another tricky question centres on whether it's better to hold income-generating assets in the non-working partner’s name or use the higher earner’s name for debt recycling benefits.

Dave highlights the trade-off between short-term tax savings and long-term efficiency in retirement. “It's not a great scenario if one person owns all the assets… that’s inefficient compared to having sort of an even split.”

Hayden suggests a 50/50 approach: “Maybe half-half is a great solution to all these kinds of predicaments because you don’t know.”

They agree that debt recycling in a high-income earner’s name can provide more value upfront, while spreading income between partners may make more sense in the long run.

“It totally depends on what you and your partner's plans are, your family plans… there are all these little nuance factors at play,” says Hayden.

Does wealth change your lifestyle?

A listener reflects on Hayden’s past comments about turning down a US$200–$300K tech salary and wonders how much his lifestyle has inflated. Hayden’s answer is refreshing.

“I told myself this a long time ago, which is that I would let all my financial decisions be based on my net wealth and not my income,” he says. “So if my income tomorrow doubled, tripled, that would not have any impact on my lifestyle.”

Though Hayden admits to some lifestyle creep – like buying more takeaway – he maintains a frugal mindset. “I still have a lot of very odd habits. Like, I just refuse to catch Ubers… I’d just walk.”

He adds that his ownership in Pearler doesn’t factor into his financial decisions either: “I disregard Pearler altogether. It’s such a bad idea to count that towards wealth because it’s a startup.”

The limitations of superannuation for early retirees

A listener asks a core FIRE question: what if you retire early but can’t access your super yet?

Hayden doesn’t mince words. “Most of the time I run into people with the opposite problem, where they're so scared of super… they save up all this money outside of super.”

One possible workaround is using a line of credit to bridge the gap, but as Hayden puts it, “Even for someone like myself… that's probably a little bit scary. I’d probably just suffer and work.”

Dave points out a crucial blind spot in many people’s strategies. “People get very excited about the tax benefits of super ," he says. "But if you're like 40 years old, it’s effectively useless for the next 20 years.”

He says the key is balance: having both super and accessible personal investments.

FIRE from a clean slate: advice for a young engineer

The final question comes from a listener whose frugal son is in his third year of electrical engineering and already investing in ETFs . The goal? $100K in passive income . They ask if property plus debt recycling is the best route.

Dave is optimistic. “He’s in an excellent position," he says. "Even that goal of 100K in passive income is probably going to be way overcooking it.”

He suggests property could work early on if done wisely, but warns against blindly copying others’ strategies.

Hayden reminds listeners that “the solution to wealth is working and saving. Investing is like the catalyst.”

Wrapping up the FIRE fundamentals

Throughout the episode, Dave and Hayden reiterate that there’s no one-size-fits-all approach to reaching FIRE. Personal circumstances, tax position, risk appetite, and future goals all influence what strategy is right for you. Whether it's debt recycling, leveraging property, splitting asset ownership, or dealing with super, it comes back to one thing: know your numbers and stay adaptable.

As Dave puts it, “Different ones can work at different times for different reasons and in different environments.”

And that’s the real message: stay flexible, stay diversified, and above all, keep saving and investing steadily.

We're always keen to hear your thoughts and topic suggestions, so hit us up at hello@aussiefirepod.com . Head over to Pearler for resources, calculators, and community insights that complement what we chat about on the show.

Until next time, keep dreaming big and living on your terms. Catch you on the next one, and happy long-term investing.

Dave and Hayden