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Why women and men invest differently

1709 cba i why women and men invest differently ai

Why women and men invest differently

While women play an active role in everyday financial decisions, they are less involved in managing long-term investments than men, according to recent research published by the Commonwealth Bank. 

Contrary to traditional gender stereotypes, women feel just as confident and capable as men when it comes to managing everyday finances. 

But when it comes to investing, there are significant differences in the attitudes and behaviour of women, according to Commonwealth Bank research, Enabling change: A fresh perspective on women's financial security.i 
  1. Women have less investments than men

    According to the research, one in two women have no investments of any kind, compared to 40 per cent of men. Women are also less likely to hold every kind of asset type, with the largest gaps in financial market investments (shares, exchange traded funds (ETFs) and derivatives) and alternative investments (such as gold, coins, stamps and art).

  2. Women are less engaged with their super

    While the majority of the men and women surveyed have super accounts (78 per cent of men versus 70 per cent of women), women are less likely to be engaged with their super than men. Only 17 per cent of women said they engage regularly with their super, compared to 29 per cent of men.

So why do these differences exist?

The research points to four main reasons for the differences in investment attitudes and behaviour between men and women:
  1. Women face ongoing economic challenges

    While women are confident financial managers, they continue to face ongoing economic challenges in Australian society, including lower salaries, less full-time employment and smaller superannuation balances. 

    Having access to less money in the first place could explain a lower engagement in investment and super decision-making for women. But conversely, it's this lack of engagement which can further limit women's ability to improve their financial position.

  2. Starting financial education earlier reaps rewards

    It may sound obvious, but the research also shows a strong link between early education in investing and higher levels of investment activity and engagement. 

    While 53 per cent of women say they were taught about managing their finances while young - a slightly higher proportion than for men - only 29 per cent were taught about investing, compared to 41 per cent of their male peers.

  3. Women focus more on everyday finances

    While many young women confidently managing their everyday finances, they are much less likely to have high levels of investment knowledge, with many only becoming confident investors later in life, when they have less time to see their assets grow. 

    In fact, when women were asked to define what financial security means to them, many focused on paying bills and coping with unexpected expenses, rather than building a comfortable lifestyle through long-term investments.

  4. Women are more risk-averse

    Compared to men, women are more risk-averse in their financial decisions, which can lead to lower levels of investment and lower returns. 

    This is reflected in the large gap between men and women holding market-based investments such as shares, with around nine male investors for every six female investors.

What can women do to bridge this gap?

As the research shows, many women remain disengaged with investing, with long-term implications for their financial health. 

That's why it's important for women to seek advice from a financial adviser to ensure they have the necessary guidance to enhance their financial wellbeing. In fact, according to the research, women who have benefited from financial advice are typically more confident and financially secure, with around 1.6 times the assets of unadvised women. 

Talk to your financial adviser

Because women face a unique set of challenges, they need customised solutions – which is where your financial adviser comes in. If there's an aspect of your finances that you need guidance on, they can help you understand your options and provide you with a plan to help you become financially secure. 

i Enabling change: A fresh perspective on women's financial security, Commonwealth Bank, May 2017 
- https://www.commbank.com.au/content/dam/caas/newsroom/docs/2017-06-28-financial-security-report.pdf 

28-Aug-17

For more information

Speak to us if you would like to understand how this information might impact your financial situation. 

Call 08 8322 5088 or email us at enquiries@jsaaccounting.com.au 
www.jsaaccounting.com.au

Important information
Robert Julian & Jill Hoadley and JSA Accounting Pty Ltd are authorised representatives of Count Financial. This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232 (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count Wealth Accountants® is the business name of Count. Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count Financial, its related entities, agents and employees for any loss arising from reliance on this document. Count Financial is registered with the Tax Practitioners Board as a Registered Tax (Financial) Adviser. However your authorised representative may not be a Registered Tax Agent. Consequently, tax considerations are general in nature and do not include an assessment of your overall tax position. You should seek tax advice from a Registered Tax Agent. If you do not wish to receive direct marketing material from your adviser, please notify your adviser by email, phone or in writing.

Navigating the options of aged care

1710 i navigating aged care options ai

Navigating the options of aged care

Successfully transitioning between in-home care services, retirement villages and full-care accommodation is all about making timely, well-informed decisions. 

Buying, selling and moving house are among the most stressful times in life. Even more so when you are retired and your health begins to decline, along with your financial assets. 

The earlier you can start planning and put money aside before you retire, the easier it is in the long run. The difficulty is that no-one knows how long they will live or what their future healthcare and accommodation needs will be. 

To make the most of your retirement assets, it's important to understand your aged care options and what each will cost. Making a false move at this stage of life can be costly. 

Retirement villages

Retirement villages are a lifestyle choice for retirees who want to downsize from their family home to a more manageable unit, but continue to live independently. Most villages offer opportunities for social activities and some offer onsite medical support. But beware – village life doesn't always live up to the glossy brochure. 

Contracts can be complex – up to 100 pages or more – so seeking professional advice to understand them is highly recommended. 

To work out the total cost of village living, you need to take account of ingoing, ongoing and exit fees and charges. 

  • Ingoing costs. Village operators offer three main finance models: outright ownership via freehold or strata title; a lease agreement; or a licence agreement, where the ingoing contribution is treated as a loan to the operator in return for a licence to occupy the unit. 

  • Ongoing fees. Operators also charge weekly, fortnightly or monthly fees to cover the costs of running the village (utilities, maintenance of common areas, staffing costs). 

  • Exit fees. Often a percentage of the ingoing cost or sale price. An example is a deferred management fee where a percentage is charged for each year of residency. 

    For example, a retirement village may retain an amount of up to 40 per cent after 10 years. Depending on the contract, you may or may not share in any capital gain. You may also be asked to contribute towards refurbishment of your unit before it's sold.
It's not uncommon for people to go into a retirement village quite late in life and then need to move to aged care soon after. In such circumstances, a large exit fee may be charged, which reduces the pool of assets otherwise available to fund entry into an aged care facility. When this occurs, it may have been better to consider other options from the outset, such as getting more in-home care or moving straight to aged care. 

Retirement villages can, however, be a good stepping stone into full care. They offer enjoyable community-based activities and access to onsite care and general home care services such as 

Aged care accommodation

If failing health leaves you needing a higher level of care, you may need to move into an aged care facility. Costs will depend on the facility and level of services as well as your Centrelink Income and Assets Assessment, but generally break down into: 

  • Basic daily care fee. This covers costs such as meals, cleaning and laundry. It is set at 85% of the maximum single age pension and for some people will be the only ongoing fee payable. Others pay an additional means-tested fee. 

  • Accommodation payment. You can pay this as a lump sum refundable accommodation deposit (RAD); periodically as a non-refundable daily accommodation payment (DAP); or a combination of the two. The RAD is refunded when you leave, less any agreed deductions. The DAP is calculated as the RAD multiplied by a predetermined interest rate and divided by 365 days. People with limited means may pay an accommodation contribution rather than an accommodation payment. 

  • Fees for additional optional services. These vary depending on your choice of facility and cover extras such as a higher standard of accommodation, wine with meals and hairdressing.

An integrated plan

Decisions about aged care accommodation are best made as part of a broader financial and estate planning process. It's also important to seek legal advice to ensure a valid Will and powers of attorney are in place. 

Your financial adviser can help assess the options available, the rules and investment strategies to consider. 

05-Oct-17

For more information

Speak to us if you would like to understand how this information might impact your financial situation. 

Call 08 8322 5088 or email us at enquiries@jsaaccounting.com.au 
www.jsaaccounting.com.au

Important information
Robert Julian & Jill Hoadley and JSA Accounting Pty Ltd are authorised representatives of Count Financial. This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232 (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count Wealth Accountants® is the business name of Count. Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count Financial, its related entities, agents and employees for any loss arising from reliance on this document. Count Financial is registered with the Tax Practitioners Board as a Registered Tax (Financial) Adviser. However your authorised representative may not be a Registered Tax Agent. Consequently, tax considerations are general in nature and do not include an assessment of your overall tax position. You should seek tax advice from a Registered Tax Agent. If you do not wish to receive direct marketing material from your adviser, please notify your adviser by email, phone or in writing.

Women and cancer: what you need to know

1710 i women and cancer what you need to know. ai

Women and cancer: what you need to know

Being faced with cancer can have a devastating impact on women and their families. That's why it's so important to reduce your health risks – and also know how to avoid the financial shock that a cancer diagnosis can bring. 

October is Breast Cancer Awareness Month, with fundraising activities held across Australia to raise money and awareness to support women affected by breast and gynaecological cancers. 

It's also a time for women to reflect on their own lives. For example, if you were struck by cancer, what would be the emotional and financial consequences for you and your loved ones? 

How to be cancer smart

No one wants to think they'll ever suffer a serious illness, but the sad reality is that cancer affects many of our lives. In fact, one in two Australian men and women will be diagnosed with cancer by the age of 85.i While the threat of cancer is very real for every woman, there are ways you can reduce the risk – or at least ensure that if you ever get diagnosed with cancer, it can be treated as effectively as possible. 

  1. Know your family history: Most people have someone in their family who has suffered from cancer at some stage. In some cases, an inherited 'faulty' gene can be passed onto their family members as well – genetic testing can help you find out if you carry this type of gene. And while some cancers aren't hereditary, family members may have lifestyle or environmental factors in common that can lead to cancer, like smoking or overexposure to the sun. 

  2. Get checked regularly: Early cancer detection improves the chances of successful treatment and long-term survival, so it's vital to get checked regularly. For example, women over 40 are advised to take advantage of free BreastScreen Australia mammograms every two years. Also, the National Cervical Screening Program recommend women aged 18-69 have Pap tests every two years. 

  3. Stay healthy: Although there is no cure, the Cancer Council of Australia recommends some simple steps you can take to lower your risk of cancer. These include quitting smoking, maintaining a healthy weight and diet, protecting your skin from the sun, limiting your alcohol consumption and getting regular exercise.

How to avoid a financial shock

Aside from the physical and emotional burden, being diagnosed with cancer can have a serious financial impact too. On one hand, you're likely to have significant medical expenses to manage, while at the same time, you could be left without an income if you're unable to work during your treatment and recovery. 

In fact, according to the Cancer Institute NSW, the out-of-pocket costs of health care are rising well above the Consumer Price Index, which is influencing some patients' decisions about whether or not to get the treatment they need.ii On the bright side, there are a range of insurance options that can help you cover costs and protect your finances if you're ever faced with cancer. 

One example is trauma insurance, which provides a lump sum payment if you're diagnosed with a critical illness like cancer or stroke. There's also income protection insurance, which can give you regular payments to make up for the loss of income if you can't work due to sickness or injury. Life insurance provides a payout to your loved ones if you pass away, and in some cases you can access some of your insured benefit early if you become terminally ill. 

It's also wise to have an up-to-date Will in place – even if you're fit and healthy. Creating a Will is an opportunity to think about who you want to leave your assets to, and it gives you peace of mind in knowing your wishes will be carried out if you pass away. Plus, it's a good idea to nominate eligible beneficiaries for the assets that don't automatically form part of your estate, such as your superannuation or life insurance. And by taking care of your estate planning needs now, it means you won't have to worry about it if you do become ill. 

i Cancer Council Australia, Facts and figures: Cancer in Australia, 9 February 2017. 

ii Cancer Institute NSW, Out-of-pocket expenses influencing health outcomes, media release, June 2016. 

05-Oct-17

How to get the right plan

Your financial adviser can help ensure you have the right types and levels of insurance cover for your situation and lifestyle. They can also help you with an estate plan and provide the financial guidance you need to understand your options, so you can make the right decision for your family. 

Call 08 8322 5088 or email us at enquiries@jsaaccounting.com.au 
www.jsaaccounting.com.au

Important information
Robert Julian & Jill Hoadley and JSA Accounting Pty Ltd are authorised representatives of Count Financial. This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232 (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count Wealth Accountants® is the business name of Count. Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count Financial, its related entities, agents and employees for any loss arising from reliance on this document. Count Financial is registered with the Tax Practitioners Board as a Registered Tax (Financial) Adviser. However your authorised representative may not be a Registered Tax Agent. Consequently, tax considerations are general in nature and do not include an assessment of your overall tax position. You should seek tax advice from a Registered Tax Agent. If you do not wish to receive direct marketing material from your adviser, please notify your adviser by email, phone or in writing.

Seven ways to get more out of retirement

1710 cba i 7 ways to get more out of your retirement ai

Seven ways to get more out of retirement

Retirement is a period of life that most of us look forward to. But it can also be a challenging lifestyle adjustment, particularly if you're someone who's used to keeping busy. So if you're after ideas on how to fill all the hours you used to spend at work, here are a few to get you started. 

1. Lend a helping hand

There are plenty of ways you can give back to the community – whether it's putting your professional skills to use or trying something completely new. For example, you might consider volunteering with a local charity, at a hospital or with an environmental organisation. You could also tutor or mentor kids from disadvantaged backgrounds, or teach music or craft at a local school. 

2. Work your brain

Retirement is a wonderful chance to learn something new – from taking a college or university course to learning a new language or trying out brain-trainers like Sudoku, cryptic crosswords or bridge. 

And while the research still isn't definitive, there's some evidence that staying mentally active in retirement can even help reduce cognitive decline and protect against the onset of dementia. 

3. Stay connected

When you're not seeing your colleagues every day, it's easy to feel isolated. A great way to meet like-minded retirees is to join a local group that shares a common interest, whether it's a book club, bushwalking club or choir. You'll be able to learn and have fun, while staying connected with your community as well. 

4. Keep fit

If retirement means your lifestyle is now less active, it's important to stay fit and healthy through regular exercise. Walking, golf, swimming and cycling are all good ways to get out and about while staying in shape. If you're not really an exercise junkie, there are other ways to keep moving, like taking up dance, tai chi or yoga. 

But if you're already leading an active life, consider setting a goal like an ocean swim or hiking expedition. It will help motivate you to stay fit and keep your body and mind healthy. 

5. Go on an adventure

After years of hard work, it's time for an escape. There are holiday options for all tastes and budgets, from overseas package tours and all-inclusive luxury cruises, to DIY caravanning across Australia. 

But before you pack your bags, ask your financial adviser to help you put together a budget so your dream holiday doesn't break the bank. 

6. Sow the seeds

If you've got a green thumb, then why not take up gardening and turn your own backyard into a lush paradise? It doesn't just have to be flowers; you could grow fruit and vegetables and even save some money on groceries. 

If you don't have a yard, you can still create a garden indoors. Simply put some pots and hanging plants in a part of the house that gets lots of sunshine, like your kitchen or balcony. 

7. Find a furry friend

Even if your kids have flown the nest, you can still find someone who needs your daily love and care. It may not have been practical for you to own a pet while you were working, but retirement may be the perfect time to discover the joys of having an animal companion. And if you get a dog you'll need to walk it daily, which has the added bonus of helping you to stay fit and active. 

But first: future proof your finances

Whether you're just starting to think about retirement or you've already left the workforce, it's a good idea to get in touch with your financial adviser. They'll help ensure you have the income you need for your retirement years, giving you the financial freedom to enjoy your new interests and hobbies. 

02-Oct-17

For more information

Speak to us today about future proofing your finances in retirement. 

Call 08 8322 5088 or email us at enquiries@jsaaccounting.com.au 
www.jsaaccounting.com.au

Important information
Robert Julian & Jill Hoadley and JSA Accounting Pty Ltd are authorised representatives of Count Financial. This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232 (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count Wealth Accountants® is the business name of Count. Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count Financial, its related entities, agents and employees for any loss arising from reliance on this document. Count Financial is registered with the Tax Practitioners Board as a Registered Tax (Financial) Adviser. However your authorised representative may not be a Registered Tax Agent. Consequently, tax considerations are general in nature and do not include an assessment of your overall tax position. You should seek tax advice from a Registered Tax Agent. If you do not wish to receive direct marketing material from your adviser, please notify your adviser by email, phone or in writing.

Insuring inside or outside super

1710 cba i insuring inside or outside super ai

Insuring inside or outside super

When it comes to choosing whether to hold personal insurance inside or outside super, both options have pros and cons. Which one is right for you? 

Benefits of each

Insurance inside super

  • Premium payments can be tax effective (although benefits may be taxable) 
  • Premiums may be cheaper 
  • Often require no medical checks to get automatic cover 
  • Can help you stay covered during periods of low cash flow.

Insurance outside super

  • Can offer more cover options 
  • Policies are typically more flexible and customisable 
  • Can offer higher levels of cover 
  • Premiums don't eat away at your final super balance.

Types of insurance

Many super funds offer three basic forms of personal insurance. These are life, Total and Permanent Disability (TPD) and income protection. Other types of insurance like trauma cover generally can't be held within super. 

Outside super, you can mix and match types of cover. Policies can sometimes be packaged up with one provider to reduce your premiums, which could otherwise be more expensive outside the super environment. 

Levels of insurance

Automatic, and typically low, levels of life and TPD cover within a super fund can be fine for a young person starting their first job. But if you're at another life stage – with a partner, children and a mortgage, for instance – it can be a different story. 

Insurers providing cover within super can put caps on the levels of cover available, so be sure to check with your fund. Outside super the levels of cover can be more flexible, but your options may also depend on your age and health. 

Medical check-ups

Super fund members who are offered automatic cover often don't need a medical check-up to get insured. Instead, your fund spreads the risk among its many members. 

At the same time, while it can be possible to find cheaper premiums outside super, considerations such as age, health and lifestyle matter. As insurance is offered on a case-by-case basis, some people may face higher premiums – but they may also have more cover options. 

Policy customisation

Insurance options through super may be less flexible, as super laws restrict policy definitions and the ability to customise policies. Automatic covers usually require little, if any, consultation with the fund member, which may or may not suit your needs. 

Policies outside super begin with a customisation process. This can be important if you need specific levels of cover. It's also useful if you want certainty around how, when and to whom payments are made if you make a claim. 

Tax considerations

For most super fund members, it can be difficult to beat the tax effectiveness of paying your personal insurance premiums through your super. However, life insurance benefits can be subject to tax if paid to a non-dependant for tax purposes, such as an adult child, while other insurance benefits paid from super may also be taxable. 

Premiums are often made from your pre-tax contributions – for example, from your employer's compulsory super payments or extra contributions you make through salary sacrificing. This means your premiums are generally paid from income that you haven't paid tax on. In contrast, life and TPD insurance premiums paid outside super come from after tax money in most cases. 

But although your premium costs don't come out of your own pocket, they can eat away at your final super balance. So if you'd prefer not to reduce your nest egg to stay covered, then insurance outside super could be the answer. 

Conclusion

The question of whether to get insurance inside or outside super, or a mix of both, is different for everyone. 

Once you've made your choice, it's not a set-and-forget decision. With each life stage and major event – such as a marriage, childbirth, mortgage or pay rise – comes new and different responsibilities. So be sure to check in with your financial adviser if your situation changes. 

02-Oct-17

For more information

Talk to us about insurance options to best suit your situation. 

Call 08 8322 5088 or email us at enquiries@jsaaccounting.com.au 
www.jsaaccounting.com.au

Important information
Robert Julian & Jill Hoadley and JSA Accounting Pty Ltd are authorised representatives of Count Financial. This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232 (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count Wealth Accountants® is the business name of Count. Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count Financial, its related entities, agents and employees for any loss arising from reliance on this document. Count Financial is registered with the Tax Practitioners Board as a Registered Tax (Financial) Adviser. However your authorised representative may not be a Registered Tax Agent. Consequently, tax considerations are general in nature and do not include an assessment of your overall tax position. You should seek tax advice from a Registered Tax Agent. If you do not wish to receive direct marketing material from your adviser, please notify your adviser by email, phone or in writing.

How would your life be affected if you had no income?

1710 cba i income protection ai

How would your life be affected if you had no income?

The idea of insuring against loss of income is one that has clear value. But many neglect to insure their most valuable asset. Income protection could be the answer – so how does it work? 

We happily insure our homes, our vehicles, even our smartphones. But have you considered how your family's lifestyle would be impacted if the main breadwinner was suddenly unable to earn an income due to injury or illness? 

According to Lifewise, a body coordinated by the Financial Services Council, 83% of Australians insure their cars but only 31% insure their ability to earn an income.i One obvious solution is income protection insurance – here's how it works. 

In a nutshell, income protection insurance can provide a percentage of your income for an agreed time if you have to stop work or you can only work in a reduced capacity due to injury or illness. 

Income protection typically covers up to 75% of your salary earnings (or, if you're self-employed, generally up to 75% of the business profits you've generated) until you can work again. 

Policies typically don't only offer cover for a specified list of conditions, as trauma insurance might. This means the cover is broader and can protect you against a wide range of health problems – from back injuries and serious illnesses to stress and other psychological issues. 

If you make a successful claim, the income stream from your policy kicks in after an agreed waiting period. Typically, this is 30 to 90 days after the event. You may choose a longer waiting period – for instance, if you know that your first few months will be covered by annual leave and sick leave entitlements. A longer waiting period generally means you pay lower premiums. Shorter waiting periods are possible, but may attract higher premiums. 

Similarly, the income stream lasts for an agreed maximum period – perhaps 12 months, two years, or until you turn 65. Shorter periods will generally attract lower premiums. This is one of the reasons why income protection policies are so useful, because they can be customised to your specific needs. 

Also, your income protection premiums are usually tax deductible, unless you've taken out cover through your super fund (in which case they are generally tax-deductible to your fund). However, if you make a claim, your benefit payments will generally be taxed at your marginal tax rate. 

So is income protection insurance right for you? That question is often answered by asking another one – how would your life be affected if you had no income? Imagine the result, six months from now, if today your income suddenly and unexpectedly dried up. Then imagine the difference if instead, after one month, an insurance provider started regularly paying 75% of your income into your bank account. 

For many Australians, income protection insurance is one of the essential ingredients of a solid financial plan. 

Case study

Wendy is a single mother who works in an office. She relies on her fortnightly paycheque to pay her mortgage, support her young son and invest for the future. After a discussion with her financial adviser she decides to take out an income protection policy offering the highest level of cover available – 75% of her current income until the age of 65. 

To help reduce her premium costs, Wendy's financial adviser recommends that she investigate how much leave she's accrued. This adds up to two weeks of annual leave plus another 10 days of sick leave. Wendy also has an emergency savings fund that could cover her living costs for up to two months. 

By stretching her waiting period from 30 days to 90 days, Wendy's income protection premiums are reduced.


i http://www.lifewise.org.au/facts-research 

02-Oct-17



For more information

Speak to us if you would like to understand how this information might impact your financial situation.

Call 08 8322 5088 or email us at enquiries@jsaaccounting.com.au 
www.jsaaccounting.com.au

Important information
Robert Julian & Jill Hoadley and JSA Accounting Pty Ltd are authorised representatives of Count Financial. This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232 (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count Wealth Accountants® is the business name of Count. Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count Financial, its related entities, agents and employees for any loss arising from reliance on this document. Count Financial is registered with the Tax Practitioners Board as a Registered Tax (Financial) Adviser. However your authorised representative may not be a Registered Tax Agent. Consequently, tax considerations are general in nature and do not include an assessment of your overall tax position. You should seek tax advice from a Registered Tax Agent. If you do not wish to receive direct marketing material from your adviser, please notify your adviser by email, phone or in writing.

Are you prepared for life's unexpected plot twists?


It's impossible to know what's on the horizon, but with the right personal insurance, at least you can be financially prepared against life's curve balls. So how do you know which types of cover are right for you? Here are some personal insurance basics to get you started on the road to financial protection.

 

Life insurance

Think of life insurance as a financial safety net for your loved ones. With the right cover in place, your beneficiaries will receive a lump sum payment in the event of your death, so they can keep up with regular expenses, cover any debts and put aside money for the future. If you're diagnosed with a terminal illness, your insurer may also agree to pay out your insurance early.

The level of cover you need depends on the debts you would leave behind (such as a mortgage) and how much your beneficiaries would need to keep up with their ongoing expenses without your income to rely on. With life insurance policies that you personally own, your premiums normally aren't tax deductible, but the payout your beneficiaries receive is generally tax free.

Income protection

If your regular earnings suddenly stopped, how long could you manage financially – and what would you have to give up?

Income protection insurance regularly pays part of your usual income if you're unable to work for an extended period due to illness or injury. You can adjust the cost and value of your cover by customising the waiting period, benefit payment period and the portion of your income you want to insure.

With an agreed value policy, the benefit amount is determined when you take out the policy. With an indemnity value policy, the benefit amount depends on your income at the time you make a claim. In either case, premiums for income protection policies that you personally own are generally tax deductible, but any claim payments you receive will generally count towards your taxable income.

Trauma insurance

Serious health conditions such as cancer, heart attack, stroke or blindness impact the lives of millions of Australians. For example, one in two Australian men and one in three women will be diagnosed with cancer by the age of 85,1 while over 3.7 million Australians are affected by heart disease.2

Trauma insurance helps cover the costs of treatment and rehabilitation in the event of a critical illness, with a lump sum paid if you're diagnosed with one of the conditions specified in your policy. Premium payments you make aren't tax deductible, but claim payouts are generally tax free.

 

TPD insurance

Being faced with a permanent disability can have a far-reaching impact on your lifestyle. With Total and Permanent Disablement (TPD) insurance, you can receive a lump sum to help cover any immediate costs and also your ongoing living expenses if you become disabled and can no longer work.

TPD insurance can either be standalone or attached to a life insurance policy. The cost of your cover may depend on whether if you choose an own occupation policy, which provides a benefit if you can no longer work in your usual job – or an any occupation policy, which generally provides a benefit if you can no longer work in any job that you're qualified for by education, training or experience.

As with life or trauma insurance, for policies that you personally own there is normally no tax deduction on the premium payments, but the payout is generally tax free.

Premium costs: stepped or level?

With life, trauma and TPD insurance, you may also be able to choose how you want to pay for your premiums:

·         Stepped premiums – these are calculated based on your age, with the premium cost generally increasing as you get older. Low entry prices make this an affordable option in the short term.

·         Level premiums – you pay more at the start, but the premium costs average out over time, meaning you can save money in the long term. In many cases, a level premium converts to a stepped premium when you turn 65, reflecting the increase in health risks for older Australians.

 

Super cover versus policy cover

Most super funds offer life insurance, plus TPD and income protection cover, with premiums paid straight from your super balance. While this cover is easy to manage and means you don't have to cover the premium costs out of your own pocket, it means your super won't be able to grow as quickly. Also, claims generally take longer to be paid – and depending on the type of insurance, claim payments may be taxed differently. Premiums may be tax-deductible to the fund, meaning a lower effective premium may apply.

Most importantly of all, the cover your fund offers might not be sufficient for your needs. In this case, you may be able to take out a separate policy outside super to cover the shortfall.

Tailored to fit

Everyone's needs are different, and it can be difficult to know which cover options are right for you. But don't worry – your Financial Adviser can help you find the right mix of insurance options for your situation and life stage.

 

1 Australian Institute of Health and Welfare, 2014. Cancer in Australia: an overview 2014.

2 Australian Institute of Health and Welfare, 2016. Cardiovascular disease.


Speak to us for more information

Speak to the team at JSA Accounting if you would like to understand more about how this information might impact your financial situation.

Important information 

Robert Julian of JSA Accounting (ABN 48 088 331 739) is an Authorised Representative of Count Financial Limited  ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.

This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. 'Count' and Count Wealth Accountants® are trading names of Count. Count advisers are authorised representatives of Count. Information in this document is based on current regulatory requirements and laws, as at 20 September 2015, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.




Flying solo: financial advice for singles

Flying solo: financial advice for singles


Single and fabulous? Make sure your finances are in top shape as well.

 

Whether you're single by choice, readjusting after a break-up or the death of a partner, or maybe you just haven't found The One yet – you probably agree that single life comes with a lot of personal freedom and flexibility.

 

It can also bring plenty of financial freedom too, since you may have fewer monetary commitments – and more to spend on yourself. For instance, you might be more likely to spend big on things like overseas adventures or treating yourself to extravagant (but well-deserved) gifts.

 

But when you're flying solo, things can end up costing more – so you might have to work harder at budgeting and saving. And because you need to create your own safety net to fall back on in tough times, it's even more essential to have watertight financial protection for your assets and lifestyle.

 

That's why it pays to have a financial plan tailored to your unique lifestyle and goals, so you can live life exactly how you want. Luckily, there are plenty of ways to use your financial freedom to your advantage, so you can build and protect your wealth and get more out of your money. Here are five ways to get your finances into shape.

 

1. Budget for one

If you don't have any kids, your household budget probably looks very different to someone your age who is supporting a family. On the one hand, you'll have more cash flow to manage your day-to-day expenses, but it can also be easier to give into the temptation to splurge.

At the same time, you need to cover all your regular household expenses – like groceries, phone and internet charges and utility bills. By making a careful budget and sticking to it, you can enjoy a comfortable lifestyle.

2. Knock debt on the head

Managing debt can be a daunting task, especially when you're tackling it solo. If you're like most people, the biggest debt you'll ever take on is a mortgage – but you may be uncertain about how to save for a deposit and find a lender who will approve you on a single income.

 

The good news is, it's possible to secure and manage a mortgage on your own. To get yourself into the best financial position to take out a home loan, all you need is a sound financial strategy. As a starting point, it helps to prioritise your existing debts like credit cards or personal loans, and pay these down first with an achievable repayment plan.

 

And when you do buy your dream home, ask us how we can help you restructure your finances so you can pay it off sooner without putting a strain on your cash flow.

 

3. Get the right cover

Being single has many advantages – but your income is even more precious when you're relying on it for all your financial support. So it's worth considering what would happen if you became ill or injured and couldn't work. Would your savings be enough to see you through recovery until you're back on your feet?

 

Getting the right insurance cover is essential. Options include income protection, which provides regular payments if you're unable to work due to sickness or injury for an extended period; Total and Permanent Disablement (TPD) insurance, which pays a lump sum if you become disabled and can't return to work; and trauma insurance, which covers you against critical illnesses like stroke and cancer.

 

JSA Accounting Pty Ltd help you work out how much cover you need to protect yourself and your lifestyle. You might also want to set up a 'rainy day' savings account, so you're prepared for any financial curve balls that are thrown your way.

 

4. Build your nest egg

Retirement planning takes on a new dimension when you're saving for it on a single income. The maximum basic Age Pension rate per fortnight is $797.90 for singles – but with even a modest lifestyle estimated to cost a 65 year old $914.12 a fortnight, every extra bit counts when you're saving for retirement.1

 

That's why it makes sense to grow your retirement savings as much as possible while you're still working. By making sure you don't need to rely solely on the Age Pension to fund your retirement, you can get on the path to a comfortable standard of living.

 

No matter whether you're just starting out in the workforce or winding down your career, it's always a good time to invest for your retirement. One way is to add a little extra to your super whenever you can – either by salary sacrificing a portion of your pre-tax salary, or by topping up with personal contributions.

 

JSA Accounting Pty Ltd can help you tailor a strategy that will allow you to retire in style without overstretching your finances in the meantime. And when the time comes to leave work behind for good, we can make sure your retirement savings stretch as far as possible.

 

 

5. Decide where your money will go

When you're single and living it up, making a Will is probably the last thing on your mind. But it's still important to think about who you want your assets to go to when you pass away. This is important not just for the assets that automatically form part of your estate, but also the assets that don't – such as your super or life insurance, where you might be able to nominate which eligible beneficiaries will receive these assets once you pass away.

 

For instance, you may want to nominate a friend or family member as a beneficiary, or donate your estate to your favourite charity. Otherwise, if you don't mind who gets your money after you're gone, you may prefer to put your money towards enjoying your retirement or even travelling in your later years.

 

We can help guide you through your options so you can decide which one feels right for you. The most important thing is to start planning now – you never know when your estate plan will need to take effect.

 

1 ASFA Retirement Standard, June quarter 2016 

Speak to us for more information

Speak to the team at JSA Accounting if you would like to understand more about how this information might impact your financial situation.

Important information 

Robert Julian of JSA Accounting (ABN 48 088 331 739) is an Authorised Representative of Count Financial Limited  ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.

This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. 'Count' and Count Wealth Accountants® are trading names of Count. Count advisers are authorised representatives of Count. Information in this document is based on current regulatory requirements and laws, as at 20 September 2015, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.


 

 

The business owner’s checklist

The business owner's checklist


Being your own boss can be rewarding, but it's also incredibly challenging. That's why it's important to future-proof your hard work by taking steps today that will prepare your business for tomorrow.

When you're running your own business, it's demanding enough to keep up with the day-to-day, which means it's easy to lose sight on the big picture. But without careful planning, your business might not be prepared for whatever the future holds.


Here are 5 essentials that every small business owner should factor into their business plan.

 

1.     Give it structure. Make sure you structure your finances so your personal assets and business assets are kept separate. As a minimum, you should have a separate business bank account and credit card, and pay yourself a salary. By untangling your personal finances from your business bookkeeping, you may even save time on administration.

2.     Be prepared for the unexpected. If anything were to happen to your staff, your equipment or your intellectual property, it could have disastrous results for your business. The concept of business insurance is a veritable smorgasbord of safeguards against unexpected events, with options ranging from vehicle and key person insurance to public liability and professional indemnity cover. No matter what type of business you have, your Financial Adviser can help make sure it's protected.

3.     Have an exit strategy. One day you (hopefully) intend to retire – and a time may even come when you decide to leave the business earlier than expected. Regardless of when you eventually exit, it's important to plan ahead so it can be done smoothly, with as little financial impact to the business as possible. Start thinking about succession management sooner rather than later – it's a good opportunity to evaluate your business and identify its future leader.

 

4.     Plan beyond yourself. Even with a retirement succession plan in place, there's always a chance your business could be faced with involuntary succession – for example, if you die unexpectedly. So as well as insuring your business, make sure you're personally covered against death, disability and serious illness. You can also set up a legally binding buy-sell agreement that sets out how ownership of the business will be transferred in the case of involuntary succession. And to be certain your assets will be distributed to your chosen beneficiaries according to your wishes if you pass away, make sure you have a comprehensive, up-to-date estate plan.

5.     Work to live, not the other way round. Your business is a big part of your life, but it's important to remember that there's also life beyond work. Many small business owners find it hard to separate work life and home life, which can cause tension with their loved ones. So if you're looking to secure your business's finances, your Financial Adviser can give you the guidance you need to remove some of the stress of business ownership.


Speak to us for more information

Speak to the team at JSA Accounting if you would like to understand more about how this information might impact your financial situation.

Important information 

Robert Julian of JSA Accounting (ABN 48 088 331 739) is an Authorised Representative of Count Financial Limited  ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.

This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. 'Count' and Count Wealth Accountants® are trading names of Count. Count advisers are authorised representatives of Count. Information in this document is based on current regulatory requirements and laws, as at 20 September 2015, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.

Is an SMSF right for you?

Is an SMSF right for you?

If you're thinking of setting up a self-managed super fund (SMSF), there are lots of things you need to consider first. That's why it's important to understand exactly what's involved so you can decide whether an SMSF is the best option for your super.

Like other superannuation funds, an SMSF is a vehicle specifically designed to help you save for your retirement. But unlike other funds, you're the one making the investment decisions rather than having someone else take care of it for you. While this puts you firmly in control of your money, it also takes time and specialised knowledge.

Here are some basics of how an SMSF works, so you can decide if you're up to the task. And remember, you should also speak to your financial adviser before making this kind of financial decision.

Pros and cons

First up, to run an SMSF effectively you need to be a savvy investor. Since it's a long-term commitment, you also have to be willing to manage and administer your fund for years to come. And that means taking on the responsibility to ensure your SMSF stays compliant – or else running the risk of paying penalties.

On the plus side, an SMSF can really open up your investment options, with the ability to invest directly in assets like property. You can also buy or sell assets relatively quickly and potentially save on administration fees if your SMSF has a high balance. Depending on your situation, an SMSF may even offer tax advantages.

Getting started       

To set up an SMSF, you can have up to four members.  All members must generally be appointed as individual trustees of the fund, or alternatively you can appoint a company to act as trustee of the fund and all members must then be directors of that company1.

Individual trustees or directors of a corporate trustee can generally be anyone aged 18 or over2. 

Each trustee – or company director, in the case of company trustees – must sign a trustee declaration form within 21 days of being appointed. This declaration states that the trustee understands and agrees to their duties and responsibilities.

Creating a trust deed

The trust deed, which is separate to the trustee declaration, sets out the rules for how you're going to run your SMSF. Things you'll need to decide include who can be a member of the fund, how trustees will vote on decisions and resolve disputes, how you can contribute to the fund and how you'll pay out benefits.

Because the trust deed is a legal document, you'll need the help of a lawyer or SMSF expert to make sure it's drafted and executed in line with the laws of your state or territory. All the trustees must sign and date the deed, and you should review it regularly and update it as required.

Registering your fund

After all the trustees have signed their trustee declarations, you have 60 days to register your SMSF. You do this by applying for an Australian Business Number (ABN) and Tax File Number (TFN) and if necessary register for GST with the Australian Business Register. Then you'll have to set up a separate bank account for your SMSF.

At the time of registration your SMSF needs to have assets in it – even if it's just a small amount of cash. So, for example, you might just put in $10 to begin with, then start making contributions later.

As part of the registration process, you should also:

·         Elect to become an ATO regulated SMSF (this ensures your SMSF is concessionally taxed)

·         Ask for a Tax File Number (TFN) for your fund

·         Depending on the fund's circumstances, register for Goods and Services Tax (GST)

Contributing to your fund

As members, you'll need to provide the Tax File Number (TFN) to your SMSF, otherwise you won't be able to make personal contributions to the SMSF and employer contributions made on your behalf may be taxed at a higher rate.

Be aware that there are some restrictions on the types and amounts of contributions and rollovers that members can make. The same contribution rules and contributions caps apply for SMSFs as they do with other super funds, so check with your financial adviser to see how much you could contribute. 

Managing your investments

Before you can start investing, you should have a written investment strategy for your SMSF. It's best to get your adviser's guidance on this as there are many important factors to consider, including the fund members' ages, retirement goals and appetite for risk.

When tailoring your investment mix, you may want to choose a range of asset types and classes, to create a buffer for your investments against market fluctuations. Your adviser can also help you review your strategy regularly to make sure you continue to meet your investment goals.

Reporting and auditing

You are responsible for managing your SMSF's accounts, statements and annual returns each year, so it's up to you to keep accurate tax and other records. As part of this process, you will need to value assets owned by the fund at their market value.

You are also required to appoint an SMSF auditor to audit your fund at the end of each financial year, at least 45 days before you lodge your annual return. You have to give the auditor all the documents they need to complete the audit.

Once the audit is done, you'll need to complete your annual return. This includes the fund's income tax return, details of contributions made for members throughout the year and information from the fund's yearly audit. You can lodge this online through the government's Standard Business Reporting website.

Paying out benefits

Since the sole purpose of an SMSF is to help its members save for retirement, members generally can't access their super until they reach their 'preservation age' and retire, cease gainful employment after turning 60, or they turn 65 – except in special circumstances. As with other forms of super, benefits are generally paid either as a lump sum, an income stream or a combination of the two.

When a member of the SMSF dies, their benefits must be paid to a dependant or their legal personal representative (in which case it forms part of their estate).  The trust deed generally sets out rules for determining which of your eligible beneficiaries will receive your death benefit, and may allow you to nominate your beneficiaries in a way that is binding on the trustee. Depending on the recipient, they may receive a lump sum, income stream, or a combination of both.

Winding down your SMSF

It's possible to close your SMSF – but once you do, you won't be able to reactivate it.

When you're ready to wind it down, you'll need to deal with member's current benefits, which could include rolling them to another complying super fund, or paying them to the member (if they have met a condition of release). This will generally involve selling the fund's assets and may have tax implications.

You'll then have to get a final audit and lodge a final annual return, specifying that you're closing the fund. After you've paid any final tax or other liabilities, you can close the fund's bank account.

Get the right advice

Everyone's financial circumstances and retirement goals are unique, which means an SMSF might be a better solution for some people than for others. Your financial adviser can talk you through your options and help you choose the right super strategy for your needs.

1.     Any trustees / directors of a company acting as trustee must also generally be members.

2.     Certain people are not able to act as a trustee or director of a corporate trustee – this includes: where they are under a legal disability; they are an undischarged bankrupt; they have been convicted of an offence involving dishonest conduct in the past; they have been penalised for breaching certain super rules in the past or they have been disqualified by the ATO.

 

Speak to us for more information

Speak to the team at JSA Accounting if you would like to understand more about how this information might impact your financial situation.

Important information 

Robert Julian of JSA Accounting (ABN 48 088 331 739) is an Authorised Representative of Count Financial Limited  ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.

This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. 'Count' and Count Wealth Accountants® are trading names of Count. Count advisers are authorised representatives of Count. Information in this document is based on current regulatory requirements and laws, as at 20 September 2015, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.


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