No big surprises…

The 2013/14 Federal Budget will not be the most memorable. However, there are $43 billion worth of savings to, hopefully, drive the budget into a wafer-thin surplus by 2016/17. Thankfully, the superannuation tinkering did not extend any further in this Budget but re-enforced the announcements made on 5 April 2013. Again, it is important to note that, in this election year, most of the proposals announced are not yet law.

From a financial planning perspective, the Budget did deliver some amendments in the social security and family benefit payment space which may impact on some clients. The superannuation, pension and social security proposals further highlights the importance of getting good financial advice.

The following is a summary of the changes (Westmount), commentary/implications (AMP) and a video summary (MLC). Rick Maggi.

Federal Budget Analysis 2013                  Commentary/Implications                Video Summary

12 End of Financial Year strategies to consider…

With the end of the financial year fast approaching, now is a great time to take advantage of various superannuation, insurance and tax strategies to reduce costs, save tax and streamline your finances.

Below is a useful guide to help you get there, but if you have any doubts or concerns, please contact us or discuss your personal circumstances with your financial adviser or tax specialist before taking action. Rick Maggi.

Read Smart EOFY Guide

Where to from here?

Has the Australian dollar peaked? What can we expect going forward? What can you do to take advantage? Rick Maggi.

Read more here

The comfort and safety of Term Deposits is a double-edged sword…

The Reserve Bank of Australia has just reduced the cash rate by 0.25% to 2.75% effective 8 May 2013. The RBA’s Media Release is below. This action is in response to a slowing Australian economy (unemployment is rising, retail and government spending is falling, mining is sluggish, and taxes are set to rise).

Leading brokers are now predicting that our cash rate is headed to 2% and billionaire investor George Soros is betting that the Australian dollar will fall. Against this backdrop, interest rates are likely to continue their drift downwards, which is bad news for term deposit investors, and will probably encourage more Australians back into higher dividend yielding shares, much like the recent American experience (US markets are now trading about 4% above their all-time highs, primarily on the back of very low interest rates).

As the Australian market remains 23% below pre-GFC levels, it is quite conceivable that our markets will get a boost from falling interest rates, provided the global picture doesn’t deteriorate. Rick Maggi.

What is the real cost of investment certainty?

An excerpt from Jim Parker’s ‘Outside the Flags’ (Vice President at Dimensional Australia) discusses the hidden risks of “certain” outcomes and capital guarantees. Worth a quick read. Rick Maggi.

Read No Free Lunches’ here

What are the implications for Australia?

Following the recent changes to Japan’s monetary policy, AMP Capital’s Dr Shane Oliver discusses it’s implications for global share markets. Rick Maggi.

Watch Now

Olivers Insights

After a strong start to the year, share markets have had a few wobbles lately and bonds have rallied again. Sell in May and go away? Rick Maggi.

Read more here

Finding that elusive work/life balance…

An interesting article with practical tips. Enjoy! Rick Maggi.

Read here

What does it all mean?

Here’s the good news. The changes were not ‘draconian’, as feared in recent weeks. In fact, most Australian’s won’t be impacted by the tweaks to investment earnings tax on pension balances. The bad news is that all of this adds greater complexity to an already complex area, which is why you should speak to your financial planner. Below is a bullet point summary of the changes, but there are other areas to consider as well, so call us. Rick Maggi.

Super Changes

Another look at ‘Quantitative Easing’ (Video)

Don’t let the term ‘quantitative easing’ scare you. The concept and reasons behind it are simple and quite justifiable in the the current climate. AMP Capital’s Dr Shane Oliver attempts to briefly explain what it is, why it’s being done, and the implications for shares and bonds going forward. An easy to understand 4 minute video, worth viewing. Enjoy! Rick Maggi.  View video here