![Safeguarding your retirement plan]()
by Jodie | Mar 3, 2017 | Budgeting, Finances, Insurance & Protection, Superannuation, Wealth
From wills to long-term budgeting, there’s a lot to think about when making your retirement to-do list. Here’s some top tips to make sure you’ve ticked all the boxes.
1. Check your Will and Power of Attorney documents
Without a valid will, an administrator will be appointed to manage your estate, which may cause your family plenty of problems. To save them stress, ask a solicitor to draw it up for you and make sure you and two witnesses sign it. Powers of Attorney protect you whilst you live, but can’t make your own decisions. Pick the person you trust most to make the big decisions in your life.
2. Plan your estate
Think of your estate plan as your family’s stress-free action plan that they can turn to for guidance when you pass away. It should cover all of your documents, contacts, debts, bills and assets so your family can easily figure out what to do with them. And don’t just put it all on paper, communicate with your family now, and let them know what you’d like so everyone is clear. It may save problems later!
3. Budget for the long haul
Australians are living longer than ever – which means your retirement savings also need to last longer. Create a long-term budget that will help you live the lifestyle you want – and don’t forget about healthcare costs. Then comes the most important part of a budget – sticking to it. Think of it as the plan you’ll follow for future spending.
4. Invest in your future
From boosting your superannuation to investing in shares and property, understanding your investment options can make a huge difference to your retirement savings. When you start investing – the earlier the better – make sure you have a mix of investments to spread your risk. And invest in yourself! Learn and partner with a professional to maximise your options.
5. Be wary of scams
Investment scams are on the rise in Australia, with perpetrators directly targeting retirees to access their superannuation funds. Protect yourself by never giving out your financial details over the phone or by email. And be suspicious of anything that sounds too good to be true. You know it probably is!
6. Start thinking about insurance
Many insurance policies expire at a certain age, leaving you without cover. And if yours comes from your superannuation fund, it could be eroding your savings. From age-based insurance policies to products that cover funeral expenses, you should seek professional financial advice to develop a plan that is appropriate for you as you enter retirement, so touch base with your planner sooner rather than later.
by Jodie | Feb 27, 2017 | Australian Economy, Budget, Economy, Superannuation
The changes to super and tax laws proposed in this year’s federal budget, then revised and adjusted by the government in September, have been passed through Parliament and are mostly due to take effect from July 1, 2017. That means that you have until July to consider if there is any action you should take to make the most of current super rules or to comply with the upcoming changes.
We take a look at some of the key changes in the table below.
Significant super reforms
| Now |
New* |
| No limit on funds moved into tax-free pension phase. |
$1.6 million transfer balance cap on super transferred to the tax-free retirement income phase. |
| You can contribute $180,000 of after-tax earnings to super each year (or $540,000 for those eligible to bring forward two years of contributions). |
Reduction in annual after-tax contributions cap to $100,000 (or $300,000 if bringing two years of contributions forward, if eligible). Clients with balances of $1.6 million or more, just before the start of the financial year, cannot make after-tax contributions. |
| Annual concessional (before-tax) contributions limit of $30,000 (or $35,000 if aged 50 or over by June 30, 2017). |
Reduction in the annual concessional (before–tax) contributions cap to $25,000. This applies regardless of age. |
| Unused concessional contributions caps are lost. |
Catch-up concessional contributions may be available for those with balances less than $500,000 just before the start of the financial year. |
| If income from employment is less than 10% of total income, you can claim a tax deduction for personal super contributions. |
Clients under age 65; or age 65-74 who satisfy the work test, can claim a tax deduction for personal super contributions. |
| Additional 15% tax on certain concessional contributions if your adjusted income exceeds $300,000. |
Additional 15% tax on certain concessional contributions, if your adjusted income exceeds $250,000. |
| Earnings on transition-to-retirement super pensions are tax free. |
No earnings tax exemption on transition-to-retirement super pensions. Earnings will be taxed at up to 15%. |
| Anti-detriment payments may apply on certain lump sum death benefits (generally a notional refund of contributions tax to be paid on death). |
No anti-detriment payments on lump sum super death benefits (no refund of contributions tax paid on death). |
| Offset for contributions to spouse’s super (if spouse earns under $13,800). |
Offset for contributions to spouse’s super (if spouse earns under $40,000). |
| The ‘low-income super contribution’ refunds tax (up to $500) on concessional contributions for those earning $37,000 or less. |
Introduction of the low-income super tax offset (effectively a continuation of the low income super contribution). |
*These measures start July 1, 2017, except for the catch-up concessional contribution measure which starts July 1, 2018.
If you are concerned about how you may be impacted, now is the time to talk to your financial adviser so you have time to review your superannuation and retirement plan, before the changes take effect.
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Want to know more? To find out how we could help you, contact our office today and make an appointment with one of our professional financial advisers on 07 5593 0855.
by Jodie | Feb 22, 2017 | In The Media
There is a dizzying array of types of insurance available in Australia, although the average person probably won’t be needing aircraft or defamation insurance. But like death and taxes, the majority of people won’t be able to avoid getting at least some of the basic types of insurance such as motor vehicle, house and contents and health cover.
by Jodie | Feb 17, 2017 | Business, Debt Management, Insurance & Protection, Savings
Protecting yourself from frivolous creditors and lawsuits is becoming an increasingly common concern. Here we outline some of the ways you can insulate your assets.
Check your insurances
Liability insurance is a must if you want to safeguard your assets in the event that you need to pay compensation. Lawsuits can arise for a range of reasons – from personal injury to financial loss resulting from any products or services you provide.
You can choose from three key types of cover – public liability insurance, professional indemnity insurance and product liability insurance. Seek advice from your financial adviser or insurance broker to determine which, if any, of these are suitable for you.
Separate business and personal assets
If you are a business owner and your family home is held in your name, it may be at risk from bankruptcy or litigation procedures.
One way to protect your home is to give majority ownership of the home to a person who is not an owner of the business, typically a spouse. The business owner generally retains some interest in the home, however, to ensure the asset is not dealt with without his or her authority. It is also important that the spouse does not having any dealings in the business, for example guaranteeing loans. You should also know that the trustee in bankruptcy will consider other factors to determine the bankrupt’s interest in the house and if you transfer your home to your spouse for no consideration or for less than its value, before bankruptcy, the trustee in bankruptcy can in some cases reverse the transaction.
Create a trust
Trusts can be beneficial asset protection strategies, as you are transferring ownership of an asset away from yourself and into a legal structure, so the asset is not yours to lose in the event you are sued.
Anthony Lieu, Lawyer at Legal Vision, says trusts also provide a degree of flexibility.
“Just as each family is different, each discretionary or family trust is also different. Trusts generally take their rules and operation from the trust deed, so each trust will have to abide by a different set of rules,” Lieu says.
Summary
Structuring your assets the right way is one of the most important things you can do to protect your hard-earned wealth. As these strategies can be complex, always seek the help of a qualified professional such as your financial planner, lawyer or accountant.
![Safeguarding your retirement plan]()
by Jodie | Feb 13, 2017 | Finances, Insurance & Protection, Investments, Money, Wealth
Creating a valid will is one of the most important things you can do to protect your loved ones. Here we explain how to go about it.
Seek legal advice
While DIY will kits can seem like an easy and inexpensive way to make a will, they can be fraught with pitfalls.
Your affairs are probably more complex than you think – your family home, business assets, super, investments and belongings. Some of things are covered by a will and some aren’t! Having a properly drawn up will helps to determine who gets what and can save your family time and stress when you are gone.
Your lawyer or financial planner will also be able to provide insights into how to best structure your will, both to protect assets and to minimise tax. Examples include setting up a testamentary trust to provide for minors or protecting your estate from creditors and making binding nominations for your superannuation funds.
Safeguard your children’s future
Probably one of the most important reasons to make a will is to ensure any dependent children are well cared for should the worst happen.
Sydney wills, probate and estate specialist, Graeme Heckenburg of Heckenberg Lawyers, says generally parents should make separate rather than joint wills, as they are likely to die at different times.
Heckenburg says a will should also appoint a guardian to take care of the day to day living and housing arrangements for the children and a trustee to execute the will and make any financial decisions. This can be one person or two different people.
“If you don’t appoint a guardian and there are young children, ultimately the decision will be made by the Guardianship Tribunal [in NSW]. If the guardianship is contested, the matter could even end up in the Supreme Court,” he says.
Keep your will updated
Once you have made a will, don’t leave it in a drawer gathering dust. Circumstances change over time change, so ensure your will reflects your current situation, particularly if your spouse has died, you have married or divorced or you have become a parent.
