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Archive for Retirement Planning

Superannuation Statements – What to Check

Last financial year’s superannuation statements are hitting your mail boxes over the last week.

It is important that you check your details are correct. The type of information you should be checking:

  • What is your balance.
  • Is the balance trending upwards over time – remember the Centrelink aged pension will probably not provide enough for the niceties in life. Chances are you will be relying on your superannuation for a better quality of life in your retirement.
  • Are all this year’s superannuation payments showing on your statement?
    Only recently we had a client whose superannuation guarantee payments from his employer were going into a different fund to the one he thought. And in rare cases, unscrupulous employers have been known not to make their payments at all even though they have a legal requirement to do so.
  • Do you have insurance within your superannuation (life, income protection or total permenant disability)?  Is it still sufficient for your needs?
    Remember that insurance premiums within your super fund are paid from your superannuation returns rather than billed to your directly. This makes them a convenient form of extra financial security, but one which it is easy to overlook.
superannuation statements in Australia

It is important to understand your superannuation – and superannuation statements – at every stage of life not just as your retirement

If you have multiple small balances in superannuation it is a good idea to consolidate them. Before you do so check you are not going to lose important insurance cover.

Lastly, check that you have received all your statements because it is easy to forget the small balance accounts.
If you move addresses and a couple of your superannuation statements are returned to the superannuation company, you might not notice.  Small balance lost super can end up in lost super.

If you need more in depth help understanding your superannuation statement, determining the right insurances, finding and consolidating superannuation please contact our friendly staff at Approved Financial Planners in Perth and we will help you get your superannuation in order.

What the Financial Planning Association of Australia (FPA) Says About Retirement Planning

We offer full service retirement planning in our Perth office. In a recent blog post, Certified Financial Planner James McFall of the Financial Planning Association of Australia (FPA) outlined ten steps he feels are essential to a comfortable retirement. As a public service, we would like to provide the information that we think is relevant to you. Remember, though, that we can only provide financial advice via a personal, one on one consult.

Retirement Planning Essentials

The FPA advocates identifying what it is that you value the most in life. After you have done this, they recommend prioritising what is important to you and then creating a list of firm goals which can be turned into a financial plan. *

Retirement Planning Essentials

According to Mr McFall, your superannuation fund is probably going to be your biggest retirement asset. He likens it to a “tax haven, but…legal.” *

The next step is to determine how much you can save and use that amount to make your plans. Mr McFall reminds that savings and home equity are available for investment and that you may consider investing either or both. He also feels that it is important to take full advantage of tax laws to lower your liability. *

According to Mr McFall, one way to create more money for retirement is to properly structure your debt. He also feels that risk mitigation is an important factor. Once one is retired, he suggests that it is still important to properly manage your asset drawdown. *

Call the Retirement Planning Advisers at Approved Financial Planners

Mr McFall’s last “step” is to obtain professional advice along the way. *

At Approved Financial Planners, we offer full service financial planning and retirement planning from our Perth area office. We offer a seven step advice process that starts with calling us to arrange for an obligation-free consult.

Call us on 08 6462 0888 to learn more.

* Financial Planning Association of Australia. The step by step guide, to achieving a comfortable retirement. 24 September 2015.

Retirement Planning 101: Pros and Cons of Investment Property for Retirement Income

Our retirement planning professionals have been helping clients in the Perth area since 2005. We have more than 80 years of combined experience in the financial planning and advising field. Property investing is currently a popular form of saving for retirement. We would like to share with you some warnings from the Australian Securities and Investments Commission about property investing to help you decide whether or not it is appropriate.

Investment Property for Retirement Income

“Pros” of Property Investing

One of the more attractive benefits about property investing is that you can create rental income while also benefiting from capital growth over time, assuming that your property actually does increase in value. Another benefit is that property is a less volatile investment than shares. When you invest in a bricks and mortar rental property, it is a tangible asset that you can touch and see.*

There is also a tax benefit to property investing. You can use the costs of maintaining and managing your property as an offset against your taxes. The interest on your loan can also be used to lower your taxes.*

“Cons” of Property Investing

There is always a chance that your rental income won’t be enough to cover your expenses. This forces you to take money out of your own pocket to pay your mortgage repayments or miscellaneous costs. If interest rates rise, it also comes out of your pocket and can consume any profit you may be making from the property.*

During times of vacancy, you still have to make the mortgage repayments, even though you don’t have a tenant. Housing is not “liquid”; you can’t sell off assets to raise quick capital. Also, property investment is often someone’s sole source of investment income. That means that there is no diversity and you are at the mercy of the housing market and interest rates.*

Costs can be high, counting stamp duty, real estate agent’s fees and legal fees. If your property doesn’t appreciate in value, you can lose money.*

Call Approved Financial Planners Today

To talk to a retirement planning professional, call Approved Financial Planners today: 08 6462 0888.

*Australian Securities and Investments Commission (ASIC), MoneySmart: “Property Investment.” https://www.moneysmart.gov.au/investing/property. 6 October 2015

Do You Want to Rely on Age Pension?

Age pension still exists to help those who need it, but the retirement planning professionals in our Perth office are dedicated to helping you secure a future in which you don’t have to rely on age pension.

Our Approach

The earlier one begins investing, the more money then can amass for their future. Sound investments make money due to the principle of compound interest. Compound interest is what happens when you reinvest interest that you made in previous years and make interest on your past interest.

Age Pension During Retirement

As anyone who is paying attention to their home or auto loan knows, compound interest can add up to a lot of money. AMP Capital uses a simple example. If you make 15% interest on $1,000 in one year and reinvest it, the next year you are making interest on $1,150.*

If $10,000 is invested a 4% per annum over twenty years, the simple interest will provide a total of $17,600 while the compound interest will yield a total of $21,068 at the end of twenty years.*

Right now, interest rates are low, but the same principle applies to investments. Compounding profits is the same principle as compounding interests. It is the job of the financial planner to find investments for you that yield as much profit as possible with as little risk as possible. Generally, the higher the yield, the higher the risk, but that is only a generalisation.

At Approved Financial Planners, we are one of Perth’s trusted names when it comes to financial advice and financial planning. To learn more or for a free consult, call us today: 08 6462 0888.

*Remember that all of the numbers above are projections based on a 4% per annum return over 20 years with $10,000 invested. The projections are for illustrative purposes only and is not an estimate of the investment returns you will receive or fees and costs you will incur.

3 Crucial Retirement Decisions

If you are planning your retirement, a retirement planning professional can be a valuable ally. We have been a trusted name in Perth since 2005 and our financial advisors have more than 80 years combined experience in the industry. While we aren’t allowed to provide anything constituting individual financial advice in this blog, we would like to pass along three crucial decisions to be made before retirement, courtesy of the Financial Planning Association of Australia (FPA).

Retirement Planning With Financial Advisors Perth

How Much Money Do You Want to Receive?

It is popular among many financial planners to recommend at least 75% of your pre-retirement income on a monthly basis when you retire. An easy example: if you currently make $80,000, you should plan to make $60,000 a month in retirement. You will be paying little or no taxes on this income compared to your time in the workforce and expenses related to work will disappear when you retire. *

According to the ASFA (Association of Superannuation Funds of Australia) Retirement Standard, couples should aim for $58,128 per year and singles $42,433 for a comfortable retirement. However, the FPA recommends that you create your own budget based on the lifestyle you want to live and then try to figure out where the money is going to come from.*

What Will You Do with Your Super?

There are three basic strategies you can use for your super when you reach retirement age: withdraw and spend, withdraw and invest or keep it in your super and start an income stream.* We will be happy to discuss the advantages and disadvantages of each approach with you in person.

To Downsize or Not to Downsize?

The decision whether or not to downsize a home is one of the more important considerations for retirement. The FPA recommends that you start early if you decide to downsize.*

To learn more or to talk to one of our financial advisors, call our Perth office today: 08 6462 0888.

*Financial Planning Association of Australia, “Planning for retirement: 3 decisions you have to make.” 8 September 2015.

Important Factors for Investing in Retirement

Retirement planning can be tricky if you don’t know what you’re doing. Fortunately, we have helped numerous people in the Perth area get started on the path to a prosperous retirement. At Approved Financial Planners, we have a wealth of local experience, combined with the resources of AMP Financial.

While we are not allowed to give any specific advice on this blog due to the disparity in individual financial situations, we would like to provide you with some general information that both we and AMP feel is important when making investment decisions.

Factors for Investing in Retirement

Why Retirement Planning is Important

For many in the previous generation, an age pension was enough to provide a comfortable retirement. However, the Australian Government is now encouraging everyone to take control and save for their own retirement.*

As more baby boomers reach retirement age, the number of people drawing pensions will soon be too large for the current workforce to sustainably support them. Consequently, Australians are being encouraged to create their own sources of income to supplement their age pensions and ensure a comfortable lifestyle after retirement.*

Here are some factors to consider when planning your retirement.*

What Do You Absolutely Need?

This is the money needed to eat, keep a home, pay the bills and transport yourself from point A to point B. This should be a steady income stream that won’t be adversely affected by inflation.*

Discretionary Spending

You don’t want to work hard, retire and then have nothing left to enjoy your life. How much money do you need to live the lifestyle you want? This can include recreation, hobbies, travel and entertainment. Do you want a family room with a large TV for entertaining? A new car? A boat? This portion is often addressed by assets that grow over time.

Call Approved Financial Planners

It will take intelligent financial planning to maximise your retirement in the Perth area. Call Approved Financial Planners today for a free consult: 08 6462 0888.*

*AMP Capital: 7 April 2015: “Investing for Retirement: 6 Things to Consider.”

Why It’s Important to be Clear on Investment Goals

Whether you are in the investment planning stage, the retirement planning stage or both, our parent company AMP recently provided information reminding us all how important it is to be clear on investment goals. We provide individual consults in our Perth office. One of the first questions we usually ask is about investment goals. Believe it or not, some of those we are consulting don’t have any investment goals yet.

Clear on Investment Goals

Why Now?

The cash interest rate is at record lows. While this is a boon for borrowers, it is causing many investors to rethink their strategies. One of the major decisions investors must make now is whether they prefer income sustainability or capital stability. *

Previously, term deposits and other cash investments have been regarded as “safe.” Under normal circumstances, cash investments deliver an adequate, if not large, level of income. In addition, their capital value is stable. *

So, what has changed? When the RBA cash interest rate is low, both loan rates and the income provided by long term cash deposits are also low. Since the RBA cash interest rate is the lowest it has ever been, many cash investments are no longer providing high enough returns to offset inflation. *

AMP mentions that a diversified portfolio of real assets, shares and bonds can be utilised to help investors produce income streams that are sustainable and predictable and rise progressively with age. They go on to mention investments such as shares offered by “quality companies,” corporate bonds of high quality with fixed coupons and property assets, especially those with long term rental agreements. Any infrastructure assets offering returns that can be linked to inflation are also seen as wise investments. *

Call Approved Financial Planners in Perth Today

We can’t provide advice on our blog, but we will be more than happy to provide a free consult in our office. To learn more or to start bringing clarity to your investment goals, call us today: 08 6462 0888.

*AMP Capital, 14 May 2015. “Be Clear on Investment Goals.”

Close to Retirement? It Might be Time for a Financial Checkup.

Retirement planning is one of our specialties. We have more than 80 years of combined experienced helping Perth residents get the most out of their retirement years. Our financial planners can work with you to devise an individual plan that can help you develop and meet a specific set of goals. This can help ensure your desired retirement lifestyle.

Retirement Planning With Financial Planners Perth

While it is always better to start retirement planning as early as possible, we realise that a lot of people are too busy living their lives to think about it. We know that it’s easy to see retirement as something far off in the future, only to wake up one day and realise that the future is coming up pretty fast.

The Process

Basically, the sooner one decides to work towards retirement, the easier it is to help them reach their financial goals. We like to have our clients choose a specific retirement date and how much money they want to have waiting for them when they get there. From there, it is easy to make a solid plan and start executing it.

If Retirement is Coming Soon

For those who are approaching retirement age and didn’t follow a plan or for those who just want to make sure they maximise all of their resources, we can help. No matter what you have done in your past, we can help you maximise what you have.

We do this by employing tax reduction strategies and maximising your Centrelink entitlements. We can also help with your superannuation fund and help you figure out the lifestyle you will be able to afford on the assets you currently have.

Call Approved Financial Planners

We can’t provide any specific advice here because every individual financial profile is different. But we can offer a free consult and a “financial checkup.” For more information or for a consult, call Approved Financial Planners today: 08 6462 0888.

Techniques for Building Wealth

We offer a full menu of financial services in our Perth office. Our financial planners can help you navigate the maze of superannuation, retirement planning and other financial services to help you determine what is right for you. We cannot give any individual advice without a consult, but we would like to give you a general overview of products and techniques that can help you build wealth.

Your Superannuation Fund

Your superannuation fund can be a helpful asset in building wealth for retirement. If you call or visit our Perth office, our financial planners can help you set up a self managed superannuation fund or help you decide which super fund you feel is the most appropriate for your needs.

Techniques for Building Wealth

After we have assessed your risk profile, we can help you develop goals for your retirement based on your preferred lifestyle and tolerance for risk. We can advise you on your current funds or we can help you find funds that match your current risk tolerance and goals.

Retirement Planning

Retirement planning can be closely linked to your super fund, but your super fund won’t be the only factor. We can assist you in setting a retirement date and a plan to help get you there. Then, we help you monitor and execute your plan. We can consider such factors as tax strategies, superannuation concessions and maximisation of Centrelink entitlements.

Investment Planning

Approved Financial Planners is proud to offer investment planning in Perth. We have the resources of AMP to back us up. We can help you choose from the many different platforms such as shares, managed funds, real estate and a plethora of other choices.

Investment planning can include such strategies as diversifying your investments to avoid the risk of “putting all your eggs in one basket.” We can review your portfolio on a periodic basis and re-calibrate it to fit your current financial situation and your lifestyle.

For a risk-free consult, call 08 6462 0888 today.

Retirement Planning in Perth, Made Easy

We provide retirement planning to many of our Perth clients. We have found that a lot of people have no idea what it entails. While we can’t give any specific advice on this blog, we thought it would be nice to give some basic information on retirement planning. Here are the basics of retirement planning, courtesy of ASIC’s MoneySmart website.

Retirement Planning In Perth Made Easy

Taking Control of Your Finances

ASIC recommends a three-pronged approach to retirement planning: take control of your finances, create a viable, long-term financial plan and find suitable vehicles for growing your retirement income.*

ASIC provides a booklet that tells you where you may withdraw your super, investment options and income stream choices for retirement, pros and cons of a lump sum versus an income stream, pros and cons of transitioning into a pension stream and where to obtain professional financial advice.*

After you know these facts, ASIC recommends that you find out exactly where you stand financially. This includes knowing your assets, where and when you can access your super, when you can apply for age pension and whether or not you are likely to pass eligibility tests.*

Creating a Long-Term Financial Plan

ASIC recommends a long-term financial plan that takes any impending changes into consideration. For example, you may finally decide to turn a lifelong hobby into a passion. You may take up a new hobby. You may want to downsize, renovate or travel. You may need a new vehicle.

Growing Your Retirement Income

ASIC acknowledges that the most common fear of retirees is outliving their money. They suggest that you obtain professional advice as early as possible. A professional financial adviser can make you fully aware of the risks and rewards of various financial strategies. The other two important things to do: diversify your investments and manage your spending.*

Call Approved Financial Planners in Perth

We have a wealth of retirement planning experience in the Perth area. Call us today to learn more: 08 6462 0888.

*ASIC, MoneySmart. “Retirement income planning.”