This issue of Wealth Adviser includes:

• Making the Right Choice: A Guide to Super Beneficiary Nominations for All Ages  Beneficiary nominations for superannuation play a crucial role in ensuring that individuals’ wishes are honoured regarding the distribution of their superannuation balance and associated death benefits. Various types of nominations exist, including binding, non-binding, and reversionary nominations, each catering to different personal and financial circumstances. Regularly reviewing and updating these nominations is essential, particularly after significant life changes, to maintain alignment with evolving family dynamics and financial situations. Seeking professional financial advice can further enhance decision-making, particularly in complex scenarios such as blended families or cross-jurisdictional concerns.
• Economic Success or Social Strain? Unpacking Wealth Resilience and Social Impact in Modern Nations  The interplay between economic growth and social cohesion presents a complex challenge for policymakers. While economic success can lead to increased prosperity and improved living standards, it may also exacerbate social inequalities and strains within communities. Addressing these disparities requires a balanced approach that promotes inclusive growth and social welfare initiatives. Ultimately, fostering a harmonious society while achieving economic objectives is essential for sustainable development and long-term stability.
• Asset Allocation and Advice: Securing Financial Health Through Upswings and Downturns  Financial advisers play a critical role of in maintaining financial health through both market upswings and downturns. Strategic asset allocation, tailored to individual goals and risk tolerance, is essential for long-term portfolio performance. Advisers provide stability by helping investors stay disciplined and avoid reactive decisions during market volatility. Additionally, rebalancing strategies are crucial for capturing gains in prosperous times while managing risks.

Q & A

1. What’s the benefit of making extra contributions to my super, and how can I do it?
2. I’m considering opening an investment account for my child. What should I be aware of?
3. What’s the difference between holding insurance inside and outside of super, and what should I consider?

This issue of Wealth Adviser includes:

• 18 rules for ageing well.  Rule 1 – it doesn’t matter – effectively “don’t sweat the small stuff” and keep things in perspective.  Rule 2 – nobody is thinking of you – they are thinking about themselves, just like you.  Read the article for more.
• Australian home prices up on supply shortfall, but at risk from high rates.  Prices are on track for a 9% gain this year.  There is a high chance that higher interest rates and another rate rise will impact growth especially if unemployment rises more than expected.  Price gains are expected to slow to 5% next year, with some downside risk.
• Asia’s economic tightrope: balancing rising oil prices amidst geopolitical uncertainty.  The Asia-Pacific region is heavily dependent on oil imports with the Israel-Gaza conflict posing risks.
• Q&A

1. I’ve heard from the news that Australians can receive more retirement income using a government initiative called the Home Equity Access Scheme (HEAS). What are the factors that determine whether I can get it or not?
2. I was reading a news article online and came across this thing called an Individually Managed Account (IMA). I was wondering what can make an Individually Managed Account more suitable for me than a managed fund?
3. I’m interested in investing but I’m not sure about whether to take on an active or passive approach to investing.  What are the pros and cons of each approach?
4. 1. 1. 1. 1.  
            2. Click here to read the full articles – Opens as a printable pdf

I was recently out to lunch with friends and we were discussing what financial freedom meant to us.  Whilst financial freedom means many different things to different people, planning for a secure financial future is something we should all be doing.

Financial freedom is about taking ownership of your finances. It is about having a dependable cash flow that allows you to live the life you want.  That way you aren’t worrying about how you’ll pay your bills or sudden expenses and you aren’t burdened with a pile of debt.

Through proper financial planning and by setting financial goals you will be able to control your finances instead of feeling like they have control of you.  Financial goals offer you direction and give you something to constantly strive for.

The very act of writing and rewriting your goals, and thinking about them each morning, will increase your chances of accomplishing them.

Below are my top 5 ways to setting financial goals:

1. Understanding Your “Why”

It’s easy to set a goal and never follow through on it.  More often than not, it’s because we don’t really know the “Why” behind the goal. We don’t know why it’s important to us or why it will bring us closer to the life we want.

Without that “Why”, we don’t have a compelling reason to do the hard work necessary to follow through.  By understanding what’s important to you it will provide you the motivation to achieve your goals.  Some questions you can ask yourself are:

• Why am I setting this goal?
• Why is it important to me, and will it help me create the life I want?

2. Financial status check

Your financial health is important, just like your physical health. Doing a financial wellness check, can help you determine what adjustments you need to make in your life. Our finances can make or break us in many cases, so having an awareness of where we stand financially is critical.

By doing a financial wellness check, we’ll be able to determine what adjustments we need to make in our lives—from saving to spending to earning.

3. Setting your goal

The best way to achieve financial goals is to start with the SMART principle.  You have probably heard of it before: Specific, Measurable, Attainable, Realistic and Timely – it’s the ideal formula to follow when setting financial goals.

Specific – Your goals have to identify exactly what it is you want to accomplish. The clearer your financial freedom vision is, the easier it will be for you to develop your overall plan and follow this goal.

Measurable – The key thing to always ask your self is this: How will I know when it is accomplished? The finish line needs to be as clear as possible.

Attainable – How are you going to achieve the goal and do you have the proper resources, tools, or skills needed to get there?

Realistic – You have to really think about what it’s going to take to reach this goal.  Evaluating what you can realistically push yourself to achieve is important.

Timely – Great goals are time limited, in that they are completed within a very specific time frame. This provides some pressure to consistently work on a goal.

4. Creating a plan for your goals

A long-term financial plan will help you to reach your long-term goals and give you a focus for your short-term goals. This financial plan will vary from individual to individual, and this is where a financial adviser can help you solidify the plan.  They will help you by creating a specific plan that suits your circumstances.

5. Take Action

Thinking about organising your finances will not help you achieve your financial goals.  In order to get the results that you want, you must take action.

An action plan is a step-by-step method to get things done. I like to think of it as a plan of attack. It’s a way to break up huge, overwhelming tasks into smaller, more manageable ones. If you’re overwhelmed by the amount of work your goal will take, an action plan will make it feel achievable.

By setting goals and understanding the flow of your money – you can look at gaining some tangible rewards – and have your money work harder for you, as opposed to working harder for your money.

About Massey Financial Advice

I am a Brisbane-based Financial Adviser with more than 14 years experience working with professionals to achieve financial freedom.  I have clients across Brisbane, including from Ashgrove, The Gap, Kenmore and Chapel Hill.

Sometimes people don’t really understand their financial situation – whether that be their personal cash flow, wealth creation or retirement plan, and this puts their lifestyle at risk.  I partner with professionals so that they feel empowered to make the best financial choices for them, their family and their career.

A great first step to preparing for your retirement is to book a cost and obligation free Financial Gap Strategy Session by clicking the link below.  This is a free phone call at a time that suits you to discuss what you are working to achieve and discuss how  I may be able to help.

If you would care to share your experience with me, please comment below!

With the end of financial year just around the corner it is a good time to make the most out of your super.  Now is a good time to think about how you could grow your super and save for retirement.

Superannuation remains on the most favoured environments within which to build wealth.  It can make an ideal place to invest your long-term savings.  Making additional contributions can grow your retirement income, and there are potential tax benefits as well.  Just keep in mind the restrictions on accessing or withdrawing your money after you contribute to super.

Peter Costello, the former Australian politician who served as Treasurer in the Howard Government, once said “If you want to save, put money into superannuation, you will never find a better savings vehicle.”

Your employer’s compulsory superannuation guarantee contributions alone are unlikely to afford you a comfortable standard of living in retirement and you may want to consider contributing more to your super.  Whether this is right for you depends on your current financial position.

Below are 3 options you could consider to help build your super and make it work harder for you.

1. Concessional Contributions

Concessional contributions, also called before-tax contributions, are the funds that go into your super account from your before-tax income. Your concessional contributions can come from a few different sources, such as employer superannuation guarantee amounts, a salary sacrifice arrangement you’ve made, or tax-deductible contributions that you make.

Concessional contributions typically make up the bulk of your super savings and are generally taxed at 15%.

Salary sacrifice is an effective way to boost your super and help you with saving for retirement.  It is an arrangement where part of your before-tax wage or salary is paid into your super account instead of being received as take-home pay. There may also be tax advantages for you, depending on how much you earn.

The concessional cap for the 2018/19 financial year is $25,000 regardless of your age, and is the maximum amount of concessional contributions that can be added into your super fund without paying extra tax, if you meet the contribution requirements.

2. Non-Concessional Contributions

Non-concessional contributions are, as you probably guessed, super contributions made from your after-tax income or savings.  For example if you work for an employer, making a contribution to super directly from your bank account is considered an after-tax contribution (unless you claim a deduction for the contribution).

Non-concessional contributions are not taxed in your super fund and you do not receive a tax deduction on them.

Whilst non-concessional contributions aren’t taxed when they’re received by your super fund, once the money is added to your account, any investment earnings will be subject to the usual superannuation tax rate of up to 15%.

There are caps on the non-concessional contributions you can make each financial year.

The cap for non-concessional contributions is $100,000 per financial year. If you are under age 65 you can bring forward up to 2 years of the non-concessional cap, allowing you to contribute up to $300,000 at a time, depending on your super balance and any previous non-concessional contributions made recently.

3. Government Co-Contribution

The super co-contribution is designed to assist eligible individuals to save for their retirement. If you are eligible and make personal super contributions during a financial year, the government will match up to half your contribution with a super co-contribution within certain limits.

If you’re a low or middle-income earner and make personal non-concessional (after-tax) contributions to your super fund, the government also makes a contribution (called a co-contribution) up to a maximum amount of $500.

The amount of government co-contribution you receive depends on your income and how much you contribute. Further information on the eligibility for the super co-contribution can be found on the ATO website.

Paying extra into your superannuation now may make a big impact later in retirement.  While 30 June is rapidly approaching you still have time to take advantage of end of financial year tax concessions and other opportunities.

About Massey Financial Advice

I am a Brisbane-based Financial Adviser with more than 14 years experience working with professionals to achieve financial freedom.  I have clients across Brisbane, including from Ashgrove, The Gap, Kenmore and Chapel Hill.

Sometimes people don’t really understand their financial situation – whether that be their personal cash flow, wealth creation or retirement plan, and this puts their lifestyle at risk.  I partner with professionals so that they feel empowered to make the best financial choices for them, their family and their career.

A great first step to preparing for your retirement is to book a cost and obligation free Financial Gap Strategy Session by clicking the link below.  This is a free phone call at a time that suits you to discuss what you are working to achieve and discuss how  I may be able to help.

If you would care to share your experience with me, please comment below!

In this do-it-yourself (DIY) world, many people choose to manage their finances on their own.  Whilst going it alone may seem like the cheapest way to manage your money and investments, it can end up costing you in the long run.

If you’re looking for advice on developing a comprehensive financial plan, you’ll want to start by seeking the services of a certified financial planner.

I was recently reading the latest findings from Roy Morgan’s Single Source survey and it found that the number of people who are asked for financial advice by their friends or families is estimated at 3.5 million, equivalent to 17.2% of Australians 14+.

Another interesting statistic from this survey followed shortly after:

Some six million Australians seek advice about money and investments from friends and families.

Unsolicited or unprofessional financial advice might seem harmless enough, but blindly following it can send you down a scary path if things don’t go right.  After all, would you seek treatment for a medical condition from your mates at a BBQ or would you see a medical practitioner for professional advice.  The advice from the medical practitioner comes from a substantial amount of education and experience.

Taking advice from anyone who isn’t qualified could cause you to make a financial decision that puts you in an unpleasant situation. Here are three people you should avoid taking financial advice from.

Family And Friends

Family members often have expectations about what your financial future should look like, expectations which don’t always line up with what you want.  In a sense, family members are almost too close to you, as they can’t be objective enough to show you all your options.  Often their approach will be what worked for them, which may not apply to your situation or work as well for you.

A financial planner has no personal stake in your money decisions — like a sports coach, it’s a financial planner’s job to remain objective and try to lead you to the path you desire. That objectivity is almost impossible for a family member.

Co-workers

You spend a lot of time with your co-workers, perhaps even more time than with your family.  This of course can lead to a lot of trust, but trust alone does not make your co-worker qualified to give you financial advice.

They may know something about the general salary you earn and even have ideas about your financial status. But they likely don’t know everything about your life goals, your family finances or financial planning in general.  How will they know what will be most effective for you given your age, current financial position and where you are trying to get to in life?

Google

The Internet is a treasure trove of information.  It is a wealth of contradictions wrapped in an argument and garnished with conflicting opinions. It’s easy to find yourself disappearing down a rabbit hole of exaggerations, unqualified opinions and alarmist advice on forums.

The Internet can be an enormous resource for finding financial information and advice.  Yet too much information can be overwhelming. It can even be dangerous when you don’t know how to separate the good advice from the bad.

There are far more unreliable resources out there than you would think. While you can look online to find the same time-tested and common sense principles about sound personal financial management, the Internet may still steer you wrong.

The help of a knowledgeable and reputable financial planner can go a long way in making sure you stay on course to meet your unique financial needs and goals.

About Massey Financial Advice

I am a Brisbane-based Financial Adviser with more than 14 years of experience working with professionals to achieve financial freedom.  I have clients across Brisbane, including from Ashgrove, The Gap, Kenmore and Chapel Hill.

Sometimes people don’t really understand their financial situation – whether that be their personal cash flow, wealth creation or retirement plan, and this puts their lifestyle at risk.  I partner with professionals so that they feel empowered to make the best financial choices for them, their family and their career.

A great first step to preparing for your retirement is to book a cost and obligation free Financial Gap Strategy Session by clicking the link below.  This is a free phone call at a time that suits you to discuss what you are working to achieve and discuss how  I may be able to help.

If you would care to share your experience with me, please comment below!

We all know that we should try to save as much as we can for retirement. But what happens if that’s not enough?

Quite simply, you will need to modify your lifestyle to meet your ability to pay for it. This could mean less leisure activities and a much simpler retirement than could otherwise be possible, making it difficult to sit back and enjoy retirement.

Not having enough money for retirement will be a reality for far too many Australians.  Right now, only a third of retirees are living on what the experts call a comfortable level of income, with roughly half of Australians over 65 still reliant on the age pension. SOURCE

Whilst you may have grand plans for travel, leisure and living the good life in retirement, with no savings how easily will these things be within your reach?

Below are some examples of how your retirement may look if you do not have adequate savings behind you.

You Will Be Dependant On The Aged Pension

More and more older people are finding themselves in a situation where they reach retirement age without enough savings.  With no savings you will have no choice other than to rely on the Age Pension to get by in retirement. Depending on the lifestyle you want, this can be tough.

A single retiree who qualifies for a full government pension can expect to receive approximately $24,081 a year, including the maximum pension supplement and an energy supplement. A couple can expect to receive approximately $36,301 a year. SOURCE

When you’re living on the aged pension, every dollar counts.  Being reliant on the aged pension you also have to face the reality that your entitlements do not keep pace with the cost of living. Rising medical, energy, living and food costs mean many age pensioners go without basics and juggle bills from week-to-week, so that they can simply afford to survive.

You Might Need To Downsize

Housing can be one of your biggest expenses.  Renting, paying off a mortgage, or paying for upkeep and rates on a property you own can deplete your finances in a hurry.

Should your savings not be able to cover your retirement, your only option will be to downsize(assuming you own your home in the first place). This will mean selling the house that you have worked so long to pay off. You might need to sell possessions and cars in order to live a smaller, more manageable life.

By downsizing you will be able to generate some extra money that can be stored away for a rainy day.

If selling your home isn’t an option you may need to consider bringing in a tenant or house mate, whether it’s a single renter residing in a section of the house or a couple to share your space with. This can be a big change to your current way of life, but you will instantly cut many of your bills in half.

Your Lifestyle Will Change

Living the good life means something different to everyone, but if you’re managing on a fixed income, such as the age pension, you may have to re-evaluate your priorities.  On the aged pension you will only be able to afford fairly basic activities.  Some lifestyle changes may include:

• Basic Clothes
• Less heating in winter/less cooling in summer
• Only taking part in no cost or very low cost leisure activities
• No car or, if you have a car, it may be an older model and you may struggle to afford repairs
• No private health insurance
• No budget to fix home maintenance problems

Of course, being happy and healthy are as important as having money, but constantly struggling to balance your bank account, could make achieving either difficult.

Unless you have a secret plan to get free money or you’re lucky enough to win the lottery, not saving enough for retirement will leave you scrambling to get by in old age.

Fortunately, it doesn’t have to be this way.  Instead of burying your head in the sand, you can get serious about retirement instead. By making your retirement a priority, you can be confident you’ll never outlive your money.

About Massey Financial Advice

I am a Brisbane-based Financial Adviser with more than 14 years of experience working with professionals to achieve financial freedom.  I have clients across Brisbane, including from Ashgrove, The Gap, Kenmore and Chapel Hill.

Sometimes people don’t really understand their financial situation – whether that be their personal cash flow, wealth creation or retirement plan, and this puts their lifestyle at risk.  I partner with professionals so that they feel empowered to make the best financial choices for them, their family and their career.

A great first step to preparing for your retirement is to book a cost and obligation free Financial Gap Strategy Session by clicking the link below.  This is a cost and obligation free phone call at a time that suits you to discuss what you are working to achieve and discuss how  I may be able to help.

If you would care to share your experience with me, please comment below!

Most people equate retirement planning with a large superannuation balance or saving money for the future.  While a retirement without money doesn’t sound like much of a retirement, focusing exclusively on the monetary aspects of the planning is missing the big picture.

Retirement is meant to be a time of leisure, to reward yourself for all your years of hard work.  As we live longer and are likely to spend more time as retirees, it’s important to be well-prepared for this phase.

A happy retirement is about so much more than having enough money to pay your bills.  Once you have a retirement plan in place to help secure your financial future, it is important that you also consider the non-financial aspects of a successful retirement.  You have so many more options today for how you spend your retirement, which is exactly why it’s more important than ever to plan for what you want to do.

Deciding Where to Live

Where you live has a big impact on your lifestyle, throughout your entire life, and this is especially true of your retirement years.  Making the decision as to where you want to live when you retire can take many years.

You have to decide what is important to you, and who is important, and that might even take some experimentation and preplanning.  You may already have some idea as to whether you want to live in a unit or a freestanding house; in a city, a suburban community or rural location; whether you want to continue to live where you are now or to return to where you grew up; or if you have children and grandchildren, whether you want to live close to them.

Some other important factors to consider are what amenities are available, good transport connections and affordable housing.  Good all-year round sunshine doesn’t hurt either!  The size of your home needs to be a good match, and many retirees choose to downsize their homes to save on maintenance and costs.

Before making your final decision, however, do your research.  It can be costly (and not to mention annoying) if you have to move again, and again.  Look for a way to try living in an area before you buy and commit to living there in retirement.

Keeping Family and Social Connections

When people retire, many lose their built-in social network of colleagues and acquaintances.  To have a happy retirement, you will need to find ways to have social interactions.  These interactions can be with your children and grandchildren, neighbours, members of a social club or church, or even the guy at the coffee shop.

Most of us are social beings and need to be involved with others to fully enjoy life.  Keeping involved in meaningful activities with people and groups – family, friends, church, community, sport just to name a few is vital to your well-being.  You could even look into volunteering to interact with people and make new friends which will increase the strength of your social network.

Retire with the intention to maintain your most important relationships.

Health Care

It is very important for you to consider your health during your retirement planning.  Your physical health and your mental wellbeing are connected.

Having an active lifestyle in retirement will help reduce the risk of health problems.  This could be as simple as joining a gym, walking club or team sport, which can also add a social element to your weekly routine.

Good health is a prerequisite for enjoying retirement, so ensure you invest in your wellbeing.  While the aim in retirement is to retain good health this may not always be the case. With this in mind being close to doctors and medical facilities should be a key consideration when choosing where you want to live in retirement.

Life will be very different once you retire, but if you put yourself in the right place, with the right people, you’ll be able to relax and enjoy life as a retiree for many happy years to come.  Some of the happiest and most content retirees have a few things beyond financial security in common.  While financial security is a key ingredient for a successful retirement, be sure not to neglect the other non-financial considerations that make for a happy retirement.

About Massey Financial Advice

I am a Brisbane-based Financial Adviser with more than 14 years of experience working with professionals to achieve financial freedom.  I have clients across Brisbane, including from Ashgrove, The Gap, Kenmore and Chapel Hill.

Sometimes people don’t really understand their financial situation – whether that be their personal cash flow, wealth creation or retirement plan, and this puts their lifestyle at risk.  I partner with professionals so that they feel empowered to make the best financial choices for them, their family and their career.

A great first step to preparing for your retirement is to book a cost and obligation free Financial Gap Strategy Session by clicking the link below.  This is a phone call at a time that suits you to discuss what you are working to achieve and find out whether I can help.

If you would care to share your experience with me, please comment below!