‘Investing’ Category

Brexit: Stay or Leave?

Brexit: Stay or Leave?

…or does it really matter?

A balanced summary of the pros and cons of a Brexit ahead of tomorrow’s vote. Enjoy! Read more here

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

The outlook for shares and growth assets

The outlook for shares and growth assets

Short term risks, but 7 reasons to be optimistic…

AMP Capital’s Dr Shane Oliver cuts through some of the current pessimism and finds some good, credible reasons to be optimistic. Be aware of the usual seasonal weakness, but don’t let it paralyse you with fear… Read more here

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

…and they’re not just for high income earners

…and they’re not just for high income earners

A viable alternative

Looking for a legal tax haven? There’s no need to look offshore – how about one you can get in Australia that’s taxed internally at 30 per cent, doesn’t need to appear on your annual tax return and if you hold it for 10 years you can withdraw it without paying any tax?

Welcome to the not so new alternative to superannuation – insurance bonds.

As the dust settles from the Federal Budget earlier this month, insurance bonds have suddenly been getting a lot of love from advisers and investors, and for good reason. With the Federal Government effectively deciding that the wealthy can look after themselves, superannuation has been reduced from a five star to a four star investment, still incredibly tax effective and worth the effort, just not quite what it used to be, particularly for those with large superannuation balances. Enter insurance bonds.

What is an insurance bond? Just to refresh your memory, they are a tax-paid investment, with the bond fund paying up to 30 per cent tax on your behalf. All money invested in them comes from after-tax dollars, but there is no limit on the amount you can invest and your money is accessible at anytime.

Because the earnings accrue within the fund there is no assessable income to declare on your tax return each year, and if you hold them for 10 years or more all proceeds can be redeemed tax-free. This makes them ideal for people who want to reduce income for purposes such as maximising the family tax payment, or becoming eligible for the Commonwealth Seniors Health Card.

And if the bond is redeemed earlier than 10 years, the proceeds are taxable as normal income, but the holder is entitled to a rebate of 30 per cent, which effectively makes the bonds almost tax-free for most investors at any stage. For example there tax on $10,000 profit will be $3,250 but the rebate will be $3,000, so the holder will have just $200 tax to pay.

They also offer significant capital gains tax advantages. They can be transferred from one investor to another at any time without capital gains tax, and within the bond you can switch between a range of investment options (like Australian and international shares) without triggering capital gains tax whenever you feel it is appropriate.

Insurance bonds also handy for older investors who can no longer contribute to super, and investing for kids and grandkids.

Assuming the latest round of Budget proposals are passed, expect to hear more about insurance bonds in the coming year.

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

The January 1 age pension changes are now law

The January 1 age pension changes are now law

What will it mean for you?

With the proposed changes to Age Pension rules (effective 1 January 2017) becoming law, this development now deserves your full attention. Retirees need to consider whether generally tighter eligibility rules will impact on the longevity of their current retirement strategy as a significant ‘pay-cut’ may be just around the corner. Read more here

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

Monthly Property Prices

Monthly Property Prices

Property prices generally rise…

With the exception of Hobart, all capital cities experienced an uptick in prices over the last month. View here

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

The Polyphony of Markets

The Polyphony of Markets

Why international diversification matters…

Dimensional’s Jim Parker discusses the importance of international diversification within investment portfolios. The article serves as a timely reminder to superannuation members, retirees, and investors to look beyond attempting to pick winners and, instead, focusing on the bigger picture – or “the effect of how all the parts fit together”. Worth a read. The Polyphony of Markets

Does your investment portfolio have the right balance?

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

Federal Budget 2016-17

Federal Budget 2016-17

Only six days to go…

There will be added interest in the Federal Budget announcement next week (May 3rd) as it’s likely to be the final major economic statement the Government makes before the election later this year, quite possibly July 2nd. With the opposition taking a strong stance on capital gains tax and negative gearing, we’re looking at a focus this year on taxation. Corporate tax could be cut by up to 1.5% however, there is likely to be minimal, if any, relief in terms of personal income tax.

There may also be some changes to superannuation. Some potential changes might be reduced contribution caps, the concessional 15% tax on super contributions, an end to ‘Transition to Retirement’ pensions and taxes on superannuation pension payments.

Overall, the outlook is for minimal growth in government spending, with spending offset by savings elsewhere in the Budget.

Where sharemarkets are concerned, historically we have seen some sideways tracking in past election years, but there has been no evidence to date of a lasting impact caused by an election. In fact, Australian economic growth has actually been strong during election years since 1980.

We’ll be watching the announcements closely next week and will keep our clients informed of any meaningful developments.

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.

Up for now…

Up for now…

…but likely to resume its long term downswing

At the time of writing, the Australian Dollar is sitting on $US0.770, which begs the question – what on earth is driving it? Read more here

For more information, contact Rick Maggi on 9382 8885 or rickmaggi@westmount.com.au.

Rick Maggi Certified Financial Planner
Westmount Financial Perth, Western Australia
Clear Focus. Better Solutions.