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Your home – the best investment you will ever make

Gareth Daniels is an Authorised Representative, GWM Adviser Services Limited, Australian Financial Services Licensee

It has been said before and it will be said again, “your home is the best investment you will ever make!”

Those of you familiar with our philosophies on wealth creation (being income focussed and the fact that the best investment that you will ever make is in yourself, your career or your business) will know that we do not subscribe to this mantra about the family home.

Recent legislative changes however, have created an opportunity to make the home you have loved, cared for and put money into over the years pay a little something back.

The downsizer

As people settle into their retirement it is common for them to realise that the home they have enjoyed for so many years is in fact now a bit too big, the garden a bit too much work, and the level of maintenance needed is now a bit too daunting. The decision to downsize is therefore made.

Moving to a smaller, more manageable property can result in substantial funds being left over from the transaction as the bigger family home is of a higher value than the new property. So, what to do with those funds?

Superannuation

Super has many rules about the amount of money that can be contributed to it, before tax contributions (concessional contributions) capped at $25,000 pa and after-tax contributions (non-concessional contributions) capped at $100,000 pa or $300,000 under the draw forward rule.

Legislative changes that came into effect on the 1st of July 2018 now mean that when the source of funds are identified as coming from the sale of the primary residence, money can be added to super as an after tax contribution above and beyond the normal annual limits; up to $300,000 per member.

Having additional money inside the superannuation environment as a retiree could provide a significant boost to the provision of passive, tax-free income to support the lifestyle that you want to live.

Eligibility

There are criteria that must be met, a summary of which includes:

* 65 years of age or older when the Downsizer Contribution is made

* You or your spouse has owned the home for 10 years or more

* It is a home in Australia (not a caravan, mobile home or houseboat)

* It is your main residence and so exempt or partially exempt from CGT

* The contribution to super is made within 90 days of receiving the proceeds

* The maximum contribution is $300,000 per person and the contributions must not exceed the total sale proceeds of the house

Next Steps

To determine if the strategy is relevant and beneficial there are some steps to work through:

* If you have determined to move, ensure the house that you are moving to meets your long term needs and that you are not ‘cutting your nose to spite your face’ by purchasing a cheaper place to boost what you can get into super only to find after a few years you are unhappy in that property

* Work with your adviser to determine what is genuinely ‘spare’ as a result of the sale of the family home. Most people incur some lump sum expenses when they move to a new house; new couch, new blinds, changing that ugly carpet in the spare room.

* Once the total available funds are known, again, work with your adviser to ensure that the correct Downsizer Contribution into Super form is completed and submitted with the contribution

* Also work with your adviser to be clear on the how the funds should be allocated within super in regard to your risk tolerance and goals and when to use the super monies to purchase an income stream.

In the truest sense of the word it may be hard to call the family home an investment. Hopefully it has been a space that has created many happy memories over the years; and now with the right implementation of strategy it may prove to be a boost to enjoying the retirement you have dreamed of.

 

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.

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 https://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.

Plugging into Technology Stocks

On August 2, Apple became the world’s first company to reach US$1 trillion in market value. It took 42 years to get there from humble beginnings in an LA garage, but a handful of younger technology companies collectively known as the FANGs – Facebook, Amazon, Netflix and Google – are already nipping at its heels.

What do they have in common? All have used innovative technology to create new markets, often beginning with a single product or service. Think Apple’s early desktop computers, Amazon’s online book retailer, Netflix’s streaming service, Facebook’s social network and Google’s search engine.

According to Forbes magazine, these tech giants have become so much a part of everyday life that their products or services are regarded almost as utilities, as essential to modern living as power or water.i They have also used technology and digital transformation to redefine customer experience in a way that is leaving traditional companies behind.

While their products and services may be cutting edge, their investment appeal is old school. Legendary investor Warren Buffett has been a major Apple shareholder for some time. He is known to look for stocks with reliable, long-term earnings at an attractive price with a strong ‘moat’. A moat might be a brand name, key products or high barriers to exit. Switch your iPhone for another brand for example, and you lose your iTunes music library and countless apps you downloaded.

China unleashes BATs

While Apple and the FANGs are US-based, they face stiff competition in the global tech stakes from China’s BATs. Baidu, Alibaba and Tencent may not be household names in Australia, but they deserve to be on investors’ radar because they are a dominant market force not just in China but increasingly elsewhere as well.

Hong Kong-listed Tencent Holdings is known as China’s equivalent of Facebook. Tencent was the first Asian company to reach the US$500 billion stock market valuation mark. It’s WeChat social media platform recently reached an eye-popping one billion members and it’s also involved in online gaming, music, e-commerce and smartphones.

Alibaba (China’s Amazon plus eBay) is the world’s biggest retailer. It’s New York Stock Exchange (NYSE) listing in 2014 was the world’s biggest and this year it became the second Asian company to be valued at more than US$500 billion.

Baidu (China’s Google) is the second most widely used search engine in the world. It’s also moving into mapping, artificial intelligence and autonomous vehicles. And these are just the biggest of many emerging Chinese tech stocks.

Opportunities and challenges

The tech giants are also beginning to expand into new business areas such as cloud storage, music and video streaming. Some are also growing by acquisition, with Facebook buying What’s App and Microsoft buying LinkedIn.

Yet big does not necessarily deliver success. Facebook’s share price recently fell 19 per cent in a day. The sell-off was due partly to concerns about the company’s ability to deal with privacy issues, but also to a flattening out of user numbers. China’s BATs also face challenges from the worsening trade dispute with the US.

So how can Australian investors participate in the dynamic technology sector without getting burnt?

Getting down to business

Diversification is the key to investing in the world’s leading tech stocks, while minimising the risk of individual companies performing poorly. The simplest way to gain exposure is via a traditional managed fund or an exchange-traded fund (ETF) which can be bought and sold on the Australian Securities Exchange (ASX) like individual shares.

For the broadest exposure there are global technology funds. A popular way to access the FANGs plus Apple, Microsoft and others is to choose a fund that tracks the Nasdaq 100 Index. Although the US-based Nasdaq exchange is home to a wide range of companies, it is well known for tech stocks.

Tech companies are often seen as exciting, but investors would do well to follow Buffett’s lead and make sure that the fundamentals are sound, looking at their financial health and ability to deliver sustainable returns. If you would like to talk about your investment strategy, give us a call.

i ‘Apple and the rise of the trillion dollar firm’, 6 August 2018, https://www.forbes.com/sites/dantedisparte/2018/08/06/apple-and-the-rise-of-the-trillion-dollar-firm/#6eecde0c631d

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.

Is your money personality set in stone?

Our upbringings hugely influence the attitudes we have towards money. Did you observe your parents working hard to put food on the table? Was money a cause of conflict in your household? Was it spent freely, or were budgets obeyed?

The money attitudes you were exposed to as a child aren’t necessary the ones you’ve taken on though. Some people exhibit money habits very different to the ones they grew up seeing, perhaps in a reaction to those circumstances or as a reflection of their personality. Take a look at a family of siblings and you might notice very different money personalities.

Here are four of the most common money personalities:

Avoider

As the name suggests, an avoider doesn’t want much to do with money. They don’t want to spend time thinking about it, which is why bills go unpaid and little attention is spent on investing and saving. There are many reasons why someone could be a money avoider, but two common ones are either feeling overwhelmed or confused around financial matters, or believing that money represents greed so it’s bad to focus on it.

Hoarder

This money personality type excels with saving but struggles to spend. This can lead to Scrooge-like tendencies, as the hoarder finds it difficult to part with their money. They’re anxious that money could be taken away from them and they must have substantial savings at all times. The hoarder doesn’t have fun with their money – the greatest enjoyment they get is knowing it’s untouched.

Spender

The opposite to the hoarder, the spender enjoys buying things for themselves and loved ones, making them very generous but sometimes irresponsible if they spend more than they earn. They risk falling into debt and struggle to save enough money for substantial purchases such as a house deposit. Delayed gratification is foreign to the spender, who’d rather buy on impulse.

Status seeker

Unlike the other money personality types, whose habits might go unnoticed at first, there’s no mistaking the status seeker. They’re the ones with the newest gadgets, flashiest cars, most fashionable clothes. The status seeker uses money to exalt their image. They have high standards and are deeply invested in how others see them. Like the spender, the status seeker risks going into debt if they can’t afford their lifestyle.

Perhaps you identify strongly with one of these types, or can see yourself in several. None are inherently bad, but they all represent unbalanced attitudes to money.

While many of these beliefs can be quite entrenched, it is possible to change your thinking and foster a more positive money mindset.

Here are some tips to bring these beliefs into equilibrium:

Understand the emotions that drive your decisions

The money hoarder tends to be driven by anxiety, while for the status seeker it’s insecurity. Identify your emotions – this observation will make you more aware of how you view and use money.

Create and maintain good money habits

A budget provides a clear picture of where money is going. They’re useful for everyone to have, but are especially helpful for the spender and avoider.

Stop comparing yourself to others

The status seeker is the worst offender, but many of us also buy things to impress others. Focus on what you want and don’t worry about keeping up with the Joneses.

Communicate with your partner about money matters

It’s possible you and your partner are different money personality types. Ensure you’re on the same page about shared spending, saving and long term goals.

Practice gratitude

Appreciating what you already have will cut down on any unnecessary spending and anxiety around your finances.

Get assistance

Whatever your attitude to money, it’s always worthwhile having someone in your corner to assist you to make the most of your financial situation. We are here to help.

 

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.

Raising Financially Educated Kids

Lee Nickelson is an Authorised Representative, GWM Adviser Services Limited, Australian Financial Services Licensee

Why do many of us have such a bad relationship with money? The recent UBS white paper¹ revealed some disturbing statistics – 56% of married women leave financial decisions to their spouse and 85% of those women do so as they feel the man ‘knows more’. The scariest statistic when taking this into account is that 8 out of 10 women will at some point in their lives be left managing their money themselves. Having had a family friend recently pass away; his widow knows all too well the difficulty taking a back step with money management has caused.

Our relationship with money starts early in our lives. Now, in the digital age of money, how do we best equip our kids to grasp the value of money?

The Financial Planning Association have released their report Share the Dream – Research into raising the Invisible Money Generation² which shows up to 68% of people are reluctant to talk to their children about money, often as they are stressed about their own situation or are concerned the discussion will make their children worry about money. Is this then perpetuating the education gap?

Interestingly, parents with a Financial Planner are much more likely to discuss money with their children. It also starts with simple conversations. Parents who report talking to their children start with pragmatic topics such as how to spend and how to save, how do we earn money, the household budget and how much people earn when they work. More complicated topics such as in app purchases, crypto currency or Afterpay type credit purchases are less likely to be discussed, though this doesn’t make them less important.

Now in the Invisible-Money generation, how do we start teaching children about money when the majority of transactions are tap and go / online based? Pocket money is a great first step for children to practice with money. I know with my 4-year-old daughter, it is about learning simple addition and subtraction, what the numbers, colours and size of the notes and coins represent and the difference of how many ice-creams she will need to forgo to buy a teddy bear. There is a tipping point between the ages of 14-18 where buying shifts from tangible products to online purchases such as apps, games and experiences, so prior education is paramount here.

The research is clear, in order for us to prepare our kids and give them the best chance to have a great relationship with money, we need to talk to them about it early and frequently. If you would like more how to hints and tips, please speak with one of our Financial Advisers.

 

¹ https://www.ubs.com/global/en/ubs-news/r-news-display-ndp/en-20180514-ubs-reveals-top-reason.html
² https://resources.moneyandlife.com.au/hubfs/FPA%20Share%20the%20Dream%20Report%20-%20August%202018.pdf 
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.

Ladies, it’s time to take control!

Elise Ryan is an Authorised Representative, GWM Adviser Services Limited, Australian Financial Services Licensee

I was reading an article entitled ‘More women will end up alone and managing their own money’ by Georgina Dent in The Age¹ and was astounded at the lack of confidence women have in their abilities.

It really struck a cord with me and I was trying to work out why and I think a quote from the article summed it up quite nicely

 

“women not only underestimate their own capabilities but they overestimate what is required to be financially involved.”

 

You shouldn’t need a man or spouse to provide you with a sense of financial security, your knowledge and understanding of your finances should be all the security you need. It can be as simple as understanding where your money is going and track your expenditures, it isn’t even hard these days you can do it on an app on your phone.

It is common in a relationship for one person to take the lead with the finances, like with a lot of household tasks. However, you are a partnership and should have an understanding of what is going on and not just leave it up to the other person so there are no surprises as to your financial position.

It is interesting that this trend is not changing with millennials, with the greater focus on women’s independence there is no trend in women stepping up and taking control of the finances, they are behaving quite primitively.

My experience from growing up is that the overall finances was a team effort. My Mum did the grunt work of paying the bills and banking but both Mum and Dad together with their Financial Advisor would look at the strategic side of things.

My relationship with my Fiancé is no different. James is happy for me to look after the day to day but he wants to be involved with the long term strategic planning.

Women should be paying more attention. We live longer, tend to have more gaps in employment and average lower pay throughout our careers.

This means that at some point in time we will need to be the ones in control and making the decisions.

Don’t know where to start, book an appointment with a Financial Advisor, find someone you can trust and identify with. They should help educate you and not make you feel dumb or silly for asking questions. Worrying about how much advice will cost or thinking that you don’t have enough money shouldn’t be a barrier for booking an appointment.

 

¹ The Age 17/06/2018, More women will end up alone and managing their own money, Georgina Dent.

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

Who is making your Financial Decisions?

In January 2018, women marched in all 50 American States, in 92 Countries, on all 7 continents in protest of the policies and positions of the Trump administration. Women worldwide are channelling their energies to articulate their right to take up equal opportunities, with respect, safety and dignity. Women worldwide are becoming outspoken and active political participants.

The #metoo movement has broadened the global dialogue on the widespread prevalence of violence and sexual assault. Women are demanding accountability and beginning provocative conversations. Women are becoming more outspoken, more educated, and the opinions of women are being represented politically and socially. Women are becoming publicly progressive in their endeavour for gender equality.

In light of the current political and social climate, I was surprised to read in an article published in the Sydney Morning Herald by Georgina Dent, where Financial Coach Julia Sotas stated that ‘56% of married women leave investment and financial decisions to their husbands…because they believe their husbands know more’.¹ In a world where women are progressive, and willing to actively participate in the global political and social dialogue of gender equality, it is interesting that women still believe that they are incapable of making investment and financial decisions.

In your partnership is your partner taking control of your financial future?
Curious to discover what motivates financial decisions of the women around me, whether they be married, in defacto relationships or single, I decided to ask some questions. I am overwhelmed by the responses I received from these educated and determined women. There is a trend, indistinguishable from cultural traditions, that most women are influenced financially by the men in their lives.
Empowered and progressive women, I urge you to become eager for not only political but also financial freedom. I urge you to take up equal opportunities and to stop underestimating your capabilities to manage your investment and financial decisions. It is time to become financially aware, involved and secure.

 

At Income Solutions we run regular Income Solutions for Women seminars. If you would like to register for an upcoming event please contact us or go to www.incomesolutions.com.au/events for more information.

 

  1. Dent, G. (2018). More women will end up alone and managing their own money. Sydney Morning Herald. [online] Available at: https://wwwsmh.com.au/money/investing/more-women-will-end-up-along-and-managing-their-money-by-themselves-20180614-p4zlfy.html [Accessed 3 Aug. 2018]
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

Interviewing a New Financial Planner

Elise Ryan is an Authorised Representative, GWM Adviser Services Limited, Australian Financial Services Licensee

How do you find the right financial planner?

Seeking financial advice can be a daunting task. You work hard for your money, so, in turn, you need to have faith that your financial advisor will make your money work hard for you to achieve your goals.

When you are looking for someone that you will trust it’s a good idea to start the search by asking your friends and family for recommendations. A referral from a trusted person will help you find an adviser with a good reputation, and someone you can have confidence in from the outset.

The next port of call that we suggest is the Financial Planning Association. They have a list of highly qualified professionals here: https://fpa.com.au/find-a-planner/

When you find an advisor that you are interested in meeting, have a look at their education. Look for qualifications like:

  • Bachelor of Commerce (BComm)
  • Certified Financial PlannerTM
  • Master of Financial Planning (MoFP)

Another key indicator is the business that they are working in. Have a look at their website and the offices where they work. If it is a growing, thriving business, they must be doing something right!

When you meet with your potential planner, make sure to interview them, this is your chance to ask them questions like:

  • Are they a specialist in a certain area or for a certain type of client? – for example: women, retirees, young professionals etc
  • What are their qualifications?
  • How many years have they been in the industry? (this is not necessarily the years they have been advising. Many advisors start in the industry and learn the ropes for years before becoming an advisor)
  • What is the process to become a client?
  • What can you expect from the service?
  • Are there additional services such as Accounting, Mortgage Broking & Cash Flow Management?
  • What technology is available to clients interact?

Don’t feel like you must go with the first planner you meet, if you don’t connect with them its ok to interview other planners even within the same business.

At Income Solutions, our first meeting is call The Right Fit.

It is a no obligation “getting to know you” meeting for both the client and the planner. Is it a chance for you to get to know if Income Solutions is the right fit for you and your financial needs and the planner to find out if you are the right client for Income Solutions.

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

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, https://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

Managing Family and Finances

Elise Ryan is an Authorised Representative, GWM Adviser Services Limited, Australian Financial Services Licensee

Everyone leads a busy life, but it’s important to take time out to think about your current finances and your financial future.

When you are planning or have a young family, there are a lot of important tasks that are on your mind. It is easy to let every day things like managing your finances fall to the wayside.

Paying the bills is quick and easy, but thinking about the big picture in 10, 20 or 30 years down the track can feel like a daunting task. Many people think retirement is so far away and that they have plenty of time before they need to start looking at planning for that phase of their lives. There is also the belief that it will just work itself out.

But you are reading this, so take the time now to think about your life in 30 years’ time.

You don’t want to regret not planning for your future.

By engaging an advisor, it forces you to take time out once or twice a year to chat about your goals and strategy and make adjustment where needed. This helps you to not only be aware but also re-evaluate what’s important to you and what your goals are year to year.

Research shows that by writing down your goals, you are more likely to plan and work towards achieving them.

By having a trusted financial advisor to look at your goals and create a tailored strategy, you will have to spend less time thinking about your financial future, and you will be in a much better position in the future.

At Income Solutions, we place a lot of time educating our clients on our investment philosophy so that they walk out of their meetings with complete understanding of what their strategy will be and how it will help them reach their financial goals.

It’s never too late to re-assess your financial position and change your strategy, and it’s never too early for your teenage children to start understanding their finances.

We run 4 events each month that will help you start making a plan, no matter what stage you are in for planning your finances:

Common Sense Investing

Common Sense Estate Planning

Kickstart: Your Financial Future

Pivot: Choose Your Financial Direction

We urge you to have a look at our website – www.incomesolutions.com.au/events or have a chat to one of our financial advisors to see which event would help you to achieve your goals, for you and your family.

 

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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