News Updates
AS IT HAPPENS
The 'concessional contributions' caps for superannuation contributions are being significantly reduced on 1 July 2012, so if you're over 50 this could impact you in a number of ways. These two articles focus of the caps themselves plus 'transition to retirement' strategies. If in doubt, please contact us before the end of June - its extremely important to get this right. Rick Maggi
Jeff Brunton, Head of Credit Markets (AMP) discusses the benefits of bond funds in an environment of declining interest rates. Rick Maggi. View video here
The Australian share market fell to a two-month low this afternoon, led by miners, as Greece's political leaders prepare for a second election in just over a month. Read more here.
The Government has released a range of proposed changes to aged care and options for older Australians.
Many of the proposals address issues raised by the Productivity Commission including (a) options to allow individuals to continue living in their home (b) contributions to the cost of care by individuals and (c) centralised areas for seeking information. At this stage there is no legislation to support the changes, so it is possible that the details may change once legislation is introduced into Parliament.
A quick video summary can be found here. For more specific details, feel free to contact Westmount. Rick Maggi
As June 30 is just around the corner we are moving into the sharp end of the tax season. Tax is major headwind to any investment and everyone has the right to minimise the amount of tax they pay through legal tax planning arrangements. Indeed the after tax return is the critical measure for any investment. But sometimes the desire to reduce tax can blind people to the risks - both investment and legal - that certain tax schemes, sophisticated and otherwise, carry with them. In recent years, the collapse of a number of high-profile agribusiness and financing schemes have painfully served to alert people to the dangers of committing to tax schemes that promise upfront tax benefits and potential investment returns that ultimately never materialised. Last year, the ATO produced a helpful, plain language guide - Understanding tax-effective investments (helping you make the right decisions) on what to look out for among some of the more common types of tax schemes that the ATO has encountered that have caught out both individual investors and businesses. Cynicism often masquerades as wisdom, especially in a post GFC world, so it is important that investors don't become paralysed with fear, taking the easiest route, which is to do nothing. But doing your homework is also an important part of the risk/reward equation, so by all means be optimistic and hopeful, but don't forget to be inquisitive. In other words, don't be afraid to see what you see. Rick Maggi Read Understanding Tax Effective Investments
Older baby boomers are increasingly asking themselves a short yet often difficult-to-answer question: When should I retire?
The answer, of course, can depend on many factors including health, satisfaction or otherwise with work, the availability of work, the size of a person’s retirement savings, and the outcome of discussions with spouses.
Interestingly, an article in The Wall Street Journal this month headed – “He Wants to Retire…But She Doesn’t” – suggests that many spouses do not agree about when their partners should leave the workforce.
Journalist Kathleen Hughes quotes research by a US investment fund manager which found that 62 per cent of couples surveyed disagreed with the timing of their spouse’s retirement.
The latest issue of an ABS report, Retirement and Retirement Intentions, Australia, shows that the average age at retirement of those who retired over the past five years was 61. (The average retirement age for men in this group was almost 63 compared to 60 for women.)
Not surprisingly, the ABS report shows that Australians are retiring at older ages than in the past.
Of the 3.2 million retirees aged over 45 in 2010-11 when these ABS figures were collected, the average age of retirement was 53. And of the male retirees in this group: 27 per cent had retired at under 55; 53 per cent between 55 and 64; and 20 per cent over 65.
The Wall Street Journal article and the ABS report on retirement are valuable reminders that we should carefully plan for retirement well ahead of any expected retirement date. And we should think of both the financial and social aspects of retirement – including, of course, the views of our spouses. Rick Maggi.
The Australian love affair with cash has been understandable one since the beginning of the GFC. Where else could you get a guaranteed, government backed asset paying 5% plus while all around was failing miserably? Vanguard's Robin Bowerman highlights investors to the age old 'health warning' that applies to all investments - namely that past performance is no guarantee that the future will deliver the same outcome. Rick Maggi Read here
In this brief article, filled with positive messages, Elm Capital's John Robertson takes a look at the strong start to 2012 and what we might expect for the remainder of 2012, based on modern history. Let's hope he's right. Enjoy! Rick Maggi Read here
US stocks advanced strongly again, sending the Dow Jones up over 200 points, to the highest level since 2007, well past 13,000. Read more here
AMP Capital's Dr Shane Oliver explains where we are in the investment cycle and implications for investors. This is an informative and easy to understand video (approx 9 min) and it reinforces the importance of getting the right mix of assets or 'asset allocation' in your investment or superannuation strategy. Enjoy! Rick Maggi Watch video here
This article, yet another from Dr Shane Oliver, will be interest to all investors, superannuation, pension and wealth accumulators alike. Rick Maggi Read Oliver's Insights
At a time when many investors have become jaded and cynical about shares, often tempted to run to the relative 'safety' of cash or bonds, Warren Buffett's shareholder letter explains why it may pay too be a little more patient. Enjoy. Rick Maggi Read article here
(Video) AMP Capital's Dr Shane Oliver series of videos takes a look at 2011 and looks forward into 2012. Worth viewing. Rick Maggi. Watch video
Vanguard's Robin Bowerman focuses on the outstanding performance of bonds during 2011, but also highlights the age old importance of diversification. Rick Maggi Read here
AMP Capital's Dr Shane Oliver looks back on 2011 and, perhaps more importantly, takes a balanced and rational look forward into 2012. Next year could be better than many expect. Rick Maggi. Read Shane Oliver's report
Significant challenges lay ahead for Europe, last Friday's fiscal 'compact' was a step in the right direction. Rick Maggi Read more
Over the last few years we've been helping clients take control of their super and pensions, reduce their fees and better protect their hard earned money better. Making a difference is easy, with the right advice. Rick Maggi Read Case Study (brief)
Research is showing that trustees of newer self-managed superannuation funds are unaware of their risks and obligations. Rick Maggi Read article (brief)
This month's snapshot focuses on the impact of hedging the international component of your investment or superannuation portfolio. This is an area we've been urging our clients to consider for quite some time as the performance difference between a currency hedged international fund versus unhedged (the vast majority of Australians have unhedged funds) can be miles apart in the shorter term. Rick Maggi December 2011 Snapshot
Read below for a summary of the Federal Government's mini-budget announcements. Rick Maggi Mini Budget 2011-12
