Getting into the Great Outdoors

Despite our intrepid image, Australia is an incredibly urbanised country by world standards, with almost 90% of our population living in or around cities.i The impact of this cosmopolitan living is a proclivity for the indoors, often resulting in sedentary lifestyles, which can augment rates of stress, depression and obesity. The antidote to all this is simple: get outdoors more often. Your body and mind will thank you for it.

The power of nature on the mind
The romantic poets wrote about it at length, and countless artists throughout history have reached the same conclusion: there is healing power in the magnificence of nature. Increasingly science is supporting this thesis, with research into the mental health benefits of being outdoors coming from all corners of the globe.

In Japan, for example, they have a tradition known as Shinrin Yoku, which basically translates as ‘forest bathing’. The idea being that you go into the woods for a length of time to calm down from city life. This practice has been shown to decrease cortisol levels as well as giving your immune cells a boost. In the States they have made similar findings, with research demonstrating that participants performed 50% better on creative problem-solving tasks after having spent three days in the wilderness.ii

By contrast, city dwellers are at much higher risk of developing anxiety and mood disorders than their rural counterparts. The reasons for this are manifold: traffic jams, excessive time seated in front of screens, the close proximity of everything and everyone – they all make it easy to get stuck in your head and sweat the small stuff. The beauty of nature by contrast is its vastness, how it can situate you in the ‘here and now’ and put your problems into perspective.

Body and soil
It appears the old saying ‘go outside and get some fresh air’ was more than just a trick your mother used to get you out of her hair. Indeed, the benefits of fresh air cannot be underplayed. Not only does the increase in oxygen help your white blood cells and thus your immunity, it also boosts your serotonin levels, ameliorating your mood and fostering a sense of well-being and joy.iii

Moreover, people who get outdoors more often are more likely to be exercising thereby producing endorphins. Even the decision to walk to the local shops rather than drive can have numerous benefits.

Cheap and easy
Getting outdoors doesn’t have to mean going on a five-day canoe trip or taking your swag to some remote location. It can be as simple as going to your local park. Australia has a legacy of public green spaces from Victorian times, as well as vast reserves of national parks not far from city centres. The best bit about them is that they are free for everyone and actually function as a social leveller. So why not take your bikes for a ride, pack a picnic with the kids, or enjoy a leisurely stroll with the dog around your local park.

To the future
The proof as they say is in the pudding, with governments around the world developing responses to the health problems associated with the concrete jungle. Many are starting to factor this into both their urban planning and public health policy. In Singapore they have long held the ‘city as a garden’ concept aiming to foster green spaces in municipal centres. Finland’s government endorses five hours of forest time every month to promote good mental health. Studies even showed that suburbs that are more heavily treed have residents with better heart and metabolic health. The same level of increase one would usually associate with a $20,000 rise in income.iv

With science on its side and governments the world over responding to our human need for nature, it seems clear that it’s something we could all use a little more of. Start with the little things—a morning walk around the block or some time out in the garden—and with warmer weather just around the corner, what better time to embrace the new, outdoorsy you.

i https://www.indexmundi.com/australia/urbanization.html

ii https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3520840/

iii http://www.phantomscreens.com/resource/getting-fresh-part-1-the-health-benefits-of-fresh-air/

iv https://www.nature.com/articles/srep11610

 

Any advice in this publication is of a general nature only and has not been tailored to your personal circumstances. Please seek personal advice prior to acting on this information. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way. Opinions constitute our judgement at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document. Before making a decision to acquire a financial product, you should obtain and read the Product Disclosure Statement (PDS) relating to that product. Past performance is not a reliable guide to future returns. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way.
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Have oil prices peaked?

Australian motorists are not the only ones hoping that global oil prices have peaked after reaching four-year highs in 2018. Not only do high oil prices flow through to the price of petrol at your local service station, but they also increase the cost of doing business for everyone from farmers to airlines and push up the cost of living for households.

On June 22 the Organisation of Petroleum Exporting Countries (OPEC) plus Russia agreed to increase output by one million barrels a day, or about 1 per cent of world supplies, to relieve global shortages and lower oil prices. Even so, the price of Brent Crude rose to US$75.60 a barrel immediately after the announcement amid concerns the target may not be met. As at June 29, the oil price had surged 64 per cent in 12 months, but if OPEC and Russia succeed in lifting supply prices should begin to fall.

There are several international oil prices quoted in the media, but the price of Brent Crude is considered the major global benchmark.

What’s going on?

OPEC’s latest turnaround follows four years of determined efforts to limit oil production and boost prices. The price of Brent Crude crashed from US$115 to US$30 a barrel in 2014 as cash-strapped producers including Russia and Venezuela increased supply. At the same time, the US expanded production from fracking.

Then early this year the freezing northern hemisphere winter pushed up the price of oil as demand spiralled. Brent Crude was trading at a sustained high of around US$80 a barrel until May, when US President Donald Trump withdrew from the Iran nuclear deal.

Under the 2015 deal, nations including the US, France, Britain, Russia, Germany and China agreed to lift international sanctions on Iran’s oil exports in return for OPEC’s third largest producer winding back its nuclear capability.

The first sign that oil prices may have peaked came on news that Saudi Arabia and Russia were discussing a possible increase in oil production. In late May the price of Brent crude eased back to levels around US$76 a barrel before settling at US$77 after the June 22 meeting sealed the deal.

Who’s affected?

Holidaymakers may feel the pinch after Qantas chief executive, Alan Joyce warned airfares could rise in response to this year’s oil price hikes. Jet fuel costs have climbed 50 per cent in the past 12 months which will eat into airline profits, depending on how much of the cost they are prepared to absorb before lifting fares.¹

Rising oil prices also erode profits of transport companies and businesses that rely on the movement of goods or the use of heavy machinery. Australian farmers face the double-whammy of rising fuel costs on top of the effects of drought.

Consumers ultimately pay for higher oil prices as they flow through to the cost of food and other goods.

There are some winners from constrained oil exports though. Australian gas producers stand to gain from increasing demand and high prices as they ramp up production and exports.

Relief ahead for motorists

Rising oil prices have inevitably been passed on to local motorists, although there is relief in sight. The national average price of unleaded petrol rose by 14.7 per cent in the three months to June to a four-year high of 153.3c a litre. Prices edged lower towards the end of June in response to the downward trend in crude oil prices.²

Rising oil prices have been exacerbated by the weaker Aussie dollar which has fallen from US81c earlier this year to recent levels below US74c.

Petrol prices vary enormously between regions, cities and even within suburbs. Australian Competition and Consumer Commission chairman, Rod Sims has urged motorists to use fuel price websites and apps to shop around (you could try MotorMouth or Compare the Market.)³

 

¹ IATA, http://www.iata.org/publications/economics/fuel-monitor/Pages/index.aspx

² Australian Institute of Petroleum as at June 24, 2018, https://aip.com.au/pricing/pump-prices

³ ‘Petrol prices stable to March but now hitting four year highs’, ACCC, 5 June 2018, href=”https://www.accc.gov.au/media-release/petrol-prices-stable-to-march-but-now-hitting-four-year-highs

 

Any advice in this publication is of a general nature only and has not been tailored to your personal circumstances. Please seek personal advice prior to acting on this information. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way. Opinions constitute our judgement at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document. Before making a decision to acquire a financial product, you should obtain and read the Product Disclosure Statement (PDS) relating to that product. Past performance is not a reliable guide to future returns. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way
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Are you prepared for the end of Financial Year

The end of the financial year is the cue for most of us to look at our financial position heading into tax time. Hopefully you’ve made progress towards your goals. But if you find that your expenses are trending higher than you’d like or—shock, horror!—higher than your income, this could be the perfect time for a fiscal makeover.

The starting point is gathering up as much information as possible, beginning with the household budget.

Take a budget snapshot

You can’t set realistic financial goals and savings targets without knowing how much money you have at your disposal. If you don’t already track your income and spending, then take an annual snapshot as you go through your records to prepare your annual tax return.

Deduct your total spending from total income and what’s left is what you have to work with. Any surplus could be used to kick start a regular savings plan. If you discover a budget black hole, identify areas where you are overspending and could cut back.

Pay yourself first

Did you manage to save anything this year or are you are constantly counting on this month’s income to pay last month’s bills? Do you spend first and hope to save what’s left?

Instead of making saving an afterthought, pay yourself first and allocate a percentage of your income to a regular savings plan. Setting up a weekly or monthly direct debit will remove temptation and encourage you to live within your means.

Review your mortgage

If you have a mortgage this is likely to be your biggest monthly expense so it’s a good idea to check your progress at least once a year. Why not use some of the savings you’ve identified and increase your repayments to save interest? If your mortgage has a redraw facility you could use this to create a cash buffer for emergencies.

While you’re at it, go online and compare interest rates. If your rate is no longer competitive ring your lender to negotiate a better deal and consider switching loans if they won’t budge. Just beware of any exit fees.

Negotiate better deals

Your home loan is not the only expense worth haggling over. These days if you want to get the best deal on your electricity, phone, internet or insurance you need to ask. Before you do, ensure you understand what your current plan/policy covers and research what’s on offer elsewhere.

Make a practice of doing this once a year, when your plan or policy is due for renewal. The savings can be substantial and can be put to much better use reducing debt or growing your wealth.

Check your super

Do you know how much you have in super and how it’s invested? When you retire superannuation is likely to be your biggest asset outside the family home, yet almost one in four Australians don’t know which risk profile their super is invested in.i This can cost you thousands of dollars in retirement savings and takes only minutes to correct.

Go to your fund’s website or call the helpline to ask for your current balance and where it’s invested. As an example, a 25-year-old woman on $80,000 in a conservative option until she’s 70 could improve her retirement balance by $294,000 if she switched to a risk profile more in keeping with her age and circumstances.¹

Protect your wealth

Reaching your life and financial goals is not just about growing your wealth but protecting it.

It’s important to review your insurance policies annually—or as your circumstances change—to make sure you and your family have adequate cover. Insurance can be a significant cost for families, but the income it provides when accidents or illness strike is worth every cent.

So why not go beyond the usual search for last-minute tax deductions this June to do a thorough review of your current position. If you would like us to help you make the most of the year ahead, give us a call.

¹ MLC Wealth Sentiment Survey, 5 April 2018,
https://www.mlc.com.au/personal/blog/2018/04/how_to_add_thousands
Any advice in this publication is of a general nature only and has not been tailored to your personal circumstances. Please seek personal advice prior to acting on this information. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way. Opinions constitute our judgement at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document. Before making a decision to acquire a financial product, you should obtain and read the Product Disclosure Statement (PDS) relating to that product. Past performance is not a reliable guide to future returns. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way.
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Federal Budget 2018

The Federal Government has turned the spending tap back on, signalling the end of the revenue drought since the GFC and the end of the mining investment boom.

As widely anticipated, Treasurer Scott Morrison’s third Budget has cut income taxes, boosted support for senior Australians, delivered $24.5 billion of new infrastructure spending and promised a return to surplus by 2020. That’s a year earlier than previously thought possible and would be the first surplus since 2007-08.

In a call to arms, in what is likely to be the last Budget before the next federal election, the Treasurer urged Australians to ‘stick with this plan for a stronger economy and more jobs because it’s working’.

The Big Picture
The Government expects this year’s budget deficit to shrink to $18.2 billion, down from a forecast before Christmas of $23.6 billion. The deficit is forecast to fall further to $14.5 billion next year before returning to a small surplus of $2.2 billion in 2020.

Net debt is expected to peak at 18.6 per cent of gross domestic product (GDP) this year and fall to 3.8 per cent of GDP in a decade. Importantly, the budget surplus is not expected to top 1 per cent of GDP until 2026.

The Budget’s major spending promises reflect a stronger economic outlook, with growth of 4.25 per cent now expected this financial year compared with 3.5 per cent in the last Budget update. GDP is set to rise $73 billion this year, fuelled by higher tax revenues, record job creation and fewer people on welfare. The government is assuming wages growth of 3.5 per cent a year from 2020, despite it currently tracking at just 2.1 per cent.

The Treasurer has pledged to limit taxes to no more than 23.9 per cent of GDP, but with spending running at around 25 per cent of GDP, that still leaves a gap between money flowing in and flowing out.

Major tax overhaul
In an attempt to win over middle Australia, the Treasurer announced major tax reform which will cost $140 billion over a decade.

Ten million low and middle-income earners earning up to $90,000 a year will receive up to $530 in tax relief per year beginning on July 1. Wealthier Australians will have to wait a bit longer under a sweeping 7-year plan to create a single income tax rate of 32.5 per cent for workers earning between $41,000 and $200,000 a year.

As a result, 94 per cent of taxpayers will pay no more than 32.5c in the dollar income tax compared with 63 per cent today. This would effectively eradicate bracket creep for millions of workers, so an increase in salary or overtime would not push people into a higher tax bracket.

At the same time, the Treasurer confirmed that the government no longer needs to increase the Medicare Levy from 2 per cent to 2.5 per cent to fund the National Disability Insurance Scheme. This will avoid further pressure on family budgets but remove a significant boost to government coffers.

The second phase of company tax cuts for big business remain in the Budget but face a rocky passage through the Senate. Meanwhile, small business will applaud the extension of the popular $20,000 instant asset write-off on new equipment purchases for a further 12 months.

Tax cuts will be partially underpinned by a $5.3 billion crackdown on the black economy. Also, the ATO will receive a $260 million funding boost from July to pursue taxpayers who over claim on work-related expenses.

Healthcare and support for seniors
Aged care is set to get big injection of funds as baby boomers move into retirement. The Treasurer announced an increase in aged care funding over four years, including $1.6 billion for 14,000 additional home care packages to help older people stay in their own home for longer.

An extra $1.4 billion for listings on the Pharmaceutical Benefits Scheme will also be added to assist Australians with serious illnesses to afford necessary drugs.

There’s also $1.3 billion over 10 years to a National Health and Medical Industry growth plan, which included $500 million for genome research.

The Pensioner Work Bonus will be extended so retirees can earn more money without affecting their pension. Retirees and now self-employed seniors will be able to earn up to $7,800 a year before reducing their pension payments.

The Pension Loans Scheme, a type of government-backed reverse mortgage, will also be expanded to include full age pensioners and self-funded retirees to the value of $17,787 per couple. The scheme is currently restricted to retired home owners who are too wealthy to qualify for a full Age Pension.

Money for roads and rail
The Government’s $24.5 billion infrastructure spend, designed to alleviate transport bottlenecks will provides a revenue boost for companies involved in the planning and construction as well as job creation for locals.

In Victoria, major projects include $5 billion for a Melbourne Airport rail link and 1.75 billion to build Melbourne’s North East Link and new tunnels and lanes for the Eastern Freeway.

In Queensland, there’s $1 billion for the M1 between Brisbane and the Gold Coast and $390 million to upgrade the Sunshine Coast rail network. In NSW, $971 million is earmarked for the Coffs Harbour bypass and $400 million for the Port Botany rail duplication. And in West Australia, $500 million to upgrade the Ellenbrook rail line.

Education and family support
There are no new announcements on funding for schools and universities, although the government will break its freeze on university funding by granting around 2000 new places across three regional universities.

The controversial school chaplains program will also be funded permanently at a cost of $61.7 million a year.

The national agreement on childcare for 4-year-olds has been extended to 2019 and an extra $54 million has been allocated to tackle sexual assault, domestic violence, cyber safety and elder abuse.

While there is no increase in the Newstart allowance for the unemployed, regional students will have easier access to Youth Allowance with a lighter parental income test.

Science, innovation and the environment
As previously announced, $500 million will be allocated over 7 years to protect the Great Barrier Reef from climate change and pollution.

Savings will be made by tightening the Research and Development (R&D) tax incentive amid mounting concerns the scheme is being rorted. Savings of $2 billion are pencilled in over the first 4 years.

Ongoing focus on national security
The government will invest $294 million to strengthen aviation, air cargo and mail security. This includes enhancing security at regional airports, increasing the number of officers, dogs and full-body scanners at major airports and boosting high tech screening of inbound cargo and mail.

Defence spending is on track to reach about 2 per cent of GDP by 2021, with $36.4 billion earmarked for Defence next financial year.

The foreign aid budget will be frozen. A large portion of this will be spent in the Pacific region as security concerns grow in the area.

Looking ahead
Australia is in a much stronger economic position than it was a year ago, but question marks remain over the sustainability of new spending promises and whether business tax cuts will make it through the Senate.

If the Turnbull Government chooses to call an election this year, voters will want to be satisfied that business conditions that underpin spending promises reaching a decade into the future are more than a temporary phenomenon, and that a recent lift in tax revenues is not a passing trend.

 

Any advice in this publication is of a general nature only and has not been tailored to your personal circumstances. Please seek personal advice prior to acting on this information. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way. Opinions constitute our judgement at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document. Before making a decision to acquire a financial product, you should obtain and read the Product Disclosure Statement (PDS) relating to that product. Past performance is not a reliable guide to future returns. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way.
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Adversity and perseverance in every day life

In December, we Bec blog Jan 2016at Income Solutions held our End of Year Event in Geelong and Melbourne to say “thank you” to our wonderful clients. Every year we have a theme and this time it was “Adversity and Perseverance”. What does that have to do with Financial Planning? Well, in terms of “hanging in there”, quite a lot really.

In a complex world with billions of inhabitants, we often find ourselves needing to be tough in order to get by – and some have it much harder than others. One of our guest speakers at the event was Moira Kelly; an amazing humanitarian who thinks nothing of entering a war torn country to help sick and injured children receive adequate medical care and a warm bed. Her list of achievements and awards from 1986 onwards would make most of us feel incredibly guilty for complaining about a bad hair day or not having a nice enough car.

Moira is one of those special people with a very interesting psyche that not all of us are born with. As a little girl, she wanted to work with Mother Theresa to help those in need. At the age of 18, her wish came true. However, Moira made it happen. She willed it to happen, but also planned and took the necessary steps to make her dream a reality.

A timely example of this level of perseverance is Mr David Bowie and his rise to fame. This week I watched a documentary on his journey to creating the Ziggy Stardust character. I like to think I’m quite knowledgeable about music artists, as my preferred literary genre is the music biography. However, I wasn’t entirely aware of just how long it took Bowie to score a hit single and sell a decent amount of records. As David Jones, he formed his first band at 15, at 20 he released a strange novelty single that flopped, followed by a string of unsuccessful singles. It took Bowie ten years to become the huge star and incredible artist we know and love (and mourn) today. The level of belief in himself and his talent is what eventually made him one of the most influential music artists of all time. Most musicians would have given up during that ten year period.

So how does adversity and perseverance apply to you and I, in our everyday lives? We don’t need to be a Moira Kelly or a David Bowie to reach our goals. However, if we want to live a fulfilling life and do the things we love, we have to “hang in there” sometimes. Are you in the right job? Do you even like it, let alone love it? Would you consider going back to study to get a job you really want? Are you currently earning what you deserve? In terms of finances, is your money working for you? How (if at all) is your money and super invested?

So many questions to ask ourselves! Sometimes we have to change a few things in our lives to get on the path we should be on. Some of us will face adversity, most of us will need to persevere – but we only get one shot at life. At Income Solutions, we’re more than just financial planners – we believe that investing in yourself and doing what you love is the key to a happy and fulfilling life; and we talk to our clients about this every day.

Are you just starting out and want to find out about putting a plan in place to secure your financial future? Perhaps you just want to learn more about how your hard earned cash can be better invested? We have a range of free information sessions held in our Geelong and Melbourne offices which cater for everyone. It doesn’t matter how much you earn, or where you are in life, you can make some informed decisions and sensible choices to help design yourself a life that you can be passionate and excited about. So, get in touch!

Rebecca Lee, Marketing Manager

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Myth #4: My Adviser should get me the best returns

SN blog 2016With recent market sentiment being all negative, oil price concerns, China devaluing the Yuan and Australian Share markets at a 2 ½ year low earlier this week, it’s timely that I post the 4th Financial Planning myth of the series; My Adviser should get me the best returns.

A good Financial Adviser, in fact, should be brave enough to admit that they’re unable to control markets and manipulate your portfolio to time markets and ‘buy low and sell high.’ Likewise, adding value by ‘picking’ individual stocks or Fund Managers is elusive.

As John Bogle, Founder and former CEO of Vanguard puts it, ‘Successful Investing is all about common sense.’ ‘Simple arithmetic suggests, and history confirms, that the winning strategy is to own all of the nation’s publicly held businesses at very low cost.’

“So what does a Financial Adviser do, then?”

A truly great Adviser should assist you to build a capital base that produces enough income to enjoy the lifestyle you want to live in the future; all whilst juggling your short term goals such as building a family, educating said loved ones, paying for travel to give your family great experiences along the way, covering contingencies (in case life doesn’t go as planned) and allowing you work-life balance – so you can enjoy the spoils of your hard work.

Indeed, there are many roles an Adviser should play in your life; including educating you to make sound decisions with money, reassuring you during tough times, giving you recognition for your efforts and achievements, providing you with peace of mind, and offering a sounding board to bounce ideas off.

My favourite description is ‘an unreasonable friend’. As a coach and a friend, your Adviser will be someone in your life who gets behind you and can give you a nudge beyond the normal limits you have set for yourself in order to help you reach for something greater. Someone who will not simply tell you what you want to hear, but rather what you need to hear, and always put your interests in front of theirs. It sounds simple, but that is often very difficult to find.

To book an appointment with an Income Solutions Adviser, visit our website now!

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DAVID RAMSAY’S END OF YEAR COMMENT

As the year comDavid EoYes to an end, you will see in the media the so-called financial experts trying to predict what the share market will return in 2016.

Personally, I never make short term predictions about the share market; but if I did it would similar to Nick Murray’s prediction for the US market for 2016. Many people say if the US sneezes we get a cold, however I hope we get what Murray predicts the US will receive in 2016:

“We’re simply observing that five hundred large profit-seeking companies, managed by experienced professionals, are currently planning to commit very large cash sums to strategies which might, if successful, result in both direct and indirect benefits to the patient, diversified, long-term investor”. Nick Murray, Client’s Corner, Dec 2015.

To find out more, I urge you to visit Nick Murray’s website and subscribe to his Newsletter Client’s Corner. The article is entitled How Companies Are Planning To Reward Shareholders In 2016. I also recommend, if you have not already done so – that you attend our free information evening Common Sense Investing. We have dates scheduled for January, however if you are still enjoying your holidays, our 2016 dates and can be viewed here.

Merry Christmas and Happy New Year to all.

David Ramsay, CEO and Founder

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RETHINKING YOUR DECISIONS

Copy of Copy of Copy of Copy of JulyAs part of my current study I was required to research and analyse the Charter Hall Group. I am inclined to share some of my findings with you.

Charter Hall Group (CHG), is a property funds manager which, was founded in 1991. The group employs specialist intellectual property and advanced intellectual knowledge to manage property assets across retail, office, residential and industrial properties. These assets can be held in either unlisted, or listed property trust.

The Charter Hall Group’s intellectual property includes investment management, asset management, property management, transaction services, development services, and treasury, finance, and legal and custodian services as outlined in the Charter Hall Group Annual Report 2015. Consequently, Charter Hall consider themselves to be the upmost experts in property.

On the 16th of June 2006, the Charter Hall Group floated on the ASX, closing at $4.97.

On the 14th of December 2015, the Charter Hall Group closing price was $4.33. This demonstrates a loss of over 12%, in 9.5 years.

I ask you, taking into consideration the information I have just shared with you.

If the experts at Charter Hall are unable to make a profit in the property market, why do so many Australians invest their time, and expend their energy trying to turn property into profit?

David Ramsay, Founder and CEO

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Myth #3: Financial Planning is all about Investing and Retirement

Steven Myth 3 blogThere is a common misperception that Financial Planning is all about Investments and Retirement Planning. Sure, the investment of surplus funds (spending less than you earn in case that is a foreign concept!) and Superannuation is a big part of what we do. However, a good Financial Planning relationship should extend well beyond simply advising on Investment and Superannuation products and strategies.

For example, your trusted Adviser should challenge you to get the best out of yourself in your career or business (what we affectionately refer to as your Purple Box here at Income Solutions) and push you to get outside your comfort zone (much the way a Personal Trainer does).

A solid Financial Planning Relationship is built on not just Trust, but importantly on a process of education. You don’t need to become an expert, but there is no doubt the better understanding you have, the more successful your outcomes. At Income Solutions, we run Information Sessions (including Common Sense Investing, Common Sense Estate Planning and First Steps to Financial Success) to assist you to gain knowledge in all things Financial Planning.

A good Adviser will also give you encouragement and the confidence to spend your Income on the things you’re passionate about; saving for a boat? Wanting the freedom to work part-time and travel more? Far too often Advisers get fixated on assisting their clients to accrue wealth, often at the expense of the very reason you sought advice in the first place, to be in a position to ‘live the life you want to live.’

Last but certainly not least, even when your Finances are in order and you are well educated, your Adviser should assist to facilitate the transfer of wealth to the next generation, embracing the responsibility to educate future generations to ensure the benefits of your hard work is reaped for generations to come, and not cashed in and spent in a heartbeat.

To learn more about the specific areas of advice we provide, find out more about our services here.

Steven Nickelson, Financial Planner

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A BIT OF A GAMBLE

A friend came to me the other day asking about shares and to look into a new ‘share trading’ app he had seen advertised on Facebook. He explained that by investing in shares he could turn $250 (the minimum deposit requirement) into $900 in a matter of hours!

This had me thinking, do many people my age see investing in shares as a get rich quick scheme or a way to make a quick buck? From various conversation with friends and family members it seems that they do.

I believe this is the wrong way to think. Shares should be seen as an investment which is held for the long term, providing regular dividends and long term capital growth. We, as young adults, don’t need to find the next speculative stock which share price may double tomorrow.

We have so many years ahead of us that we should be more concerned about creating good saving habits, establishing a sound financial strategy and investing in the right kind of shares. These ‘right kind of shares’ will grow in the background without the need to regularly log onto a share trading app to see if your investment has double (or halved in value) and then quickly sell at the right time. These ‘share trading’ apps sound a bit like gambling to me!

We should be buying the right kind of stocks, holding them for the long term and reaping the rewards of compounding. The information evening that we host at Income Solutions every month (called Common Sense Investing) is a great place to start your long term journey and perhaps hear a new point of view.

If you’d like to hear more, register NOW!

Patrick Dwyer, Associate Financial Planner

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