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Those who offer financial planning services in Australia aren’t always the same. Many give blanket advice or try to fit every client into the same system of investing without first assessing their needs.

At Approved Financial Planners, we know that everyone’s situation is as different as their fingerprints and we go to great lengths to get all of the information we need to help you formulate a plan to get you where you want to be when you want to be there.

We strongly suggest advice from a Perth professional, but here are five DIY mistakes that we think it would be wise to avoid.

Not Doing Your Homework

Whatever you plan to use as an investment vehicle, your chances of success are usually proportionate with the knowledge you have amassed concerning that investment vehicle. If you don’t, you might as well be a welder trying to do heart surgery.

How to ease the transition to retirement pension by maximising what you already have.

Although we can’t give specific advice due to the individual nature of investing, we can provide some tips for easing the transition to retirement pension. As more Australians born during the baby boomer era reach retirement age, it is becoming more important to maximise your retirement opportunities. Here are some helpful tips.

Send Your Tax File Number (TFN) to Your Superannuation Fund

This is a fundamental, but failure to execute it can cost you thousands. If you fail to supply your super fund with your TFN, you pay a penalty tax on your concessional or before-tax contributions and you won’t be allowed to make non-concessional or after-tax contributions. Additionally, you won’t be eligible for the co-contribution scheme.

Combine Your Super Accounts

If you have different super accounts, you may be paying fees on each of them. Combining them into one fund could save a lot of money.

How to protect your family from the prospect of long term disability.

When we are planning our financial futures, we often focus on our income, our own lives and our retirement. But what about the lives of your children? Do you have an adult child who has just started a family or just bought a home? You have done your job well. You have raised children who are now adults. Maybe you have done well with investments and are winding down your career in anticipation of retirement.

Congratulations. We know your “job” as a parent is finished when your children become adults. However, we strongly suggest doing one more thing to help them protect their futures: ask them if they have protected their income yet.

If your adult child sustained an illness or injury that caused them long term disability and made them unable to produce income, would they be able to get by? It may be time to have a talk with your adult child and make sure their assets are protected.

Young families are often struggling to get by with mortgage repayments, rising costs of living and student loan repayments. Often, the last thing they are thinking of is insurance. This can be a huge mistake.

A financial planner’s role is to provide expert financial advice. While many people think that all a financial planner does is invest money, it’s more than that. A financial planner is there to help you devise a strategy for your present and future financial health. In other words, as opposed to just investing money, we want to help you use it to determine your future.

One of the reasons that ethical firms only provide general information on blog posts and brochures is because everyone’s financial situation is different. If someone just asks us for investment advice, we always tell them that we need more information first. One of the most important things we need to know is what goals you are trying to achieve.

We will want to know how much you plan to spend in the future and what you would like to spend it on. We want to know whether you enjoy your current line of work or if you want to retire as early as you can possibly make it happen.

For example, many people are very happy in their chosen profession and plan to work as long as they are physically able. On the other hand, some walk into work every day dreaming about retirement. It is our job to help you turn your dreams into reality. Many people, for example, make the shift from their profession to being successful property investors.

Superannuation reforms have generated a lot of inquiries in our Perth office. We want to take this time to thank you all for your inquiries and to provide a short guide to the more important parts of the reform and how they will affect you. Remember that our information is general in scope and that we can’t provide blanket advice because every investor’s situation is different.

Any new Superannuation Fund started as of 1 January 2015 will be subject to the new deeming rules. The rules have changed the Age Pension income test, effectively double-counting any superannuation assets when assessing income. Since many Australians will still be depending on their Age Pensions as a significant part of their retirement income, the changes could potentially be devastating to many retirees.

The mechanics of the assessment are complicated and explaining them here is not the purpose of this piece. The net effect is that a lot of Australians could collect less money during retirement due to the changes.

Who Will Be Affected?

It is important to know whether or not your superannuation fund will affect your Age Pension income test in the future. If you are already receiving the Age Pension now or begin receiving it before 1 January 2015, you will be exempt from the changes and your Age Pension income test will continue under the old rules.

The ins and outs of SMSF borrowing to fund your property investments.

Under the right circumstances, you can now use your SMSF to invest in most forms of real property, including industrial, commercial, residential and farm property. Before September 2007, it was much more difficult; that month marked the first easing of SMSF regulations in regard to real assets.

In July 2010, the rules were relaxed yet again. Now, with the exception of two specific situations designed for short term cash flow, you are allowed to formulate a limited recourse borrowing arrangement, or LRBA, which limits the lender’s recourse to the specific asset for which the money was borrowed.

The LRBA is now extremely popular as an SMSF investment strategy, so popular that on 14 September 2011, the ATO felt it was necessary to draft a clarification of the rules for LRBAs. In May 2012, this would be finalised as “SMSFR, 2012/1,” which discusses the key concepts that are consistent with the application of the limited recourse borrowing arrangement provisions.

What is trauma insurance and how does a recent change in regulations affect your Self Managed Super Fund (SMSF)?

Trauma insurance is a form of cover that pays a lump sum if the insured receives a diagnosis of any of the critical injuries or illnesses specifically mentioned in the policy. Conditions most commonly covered are coronary bypass, heart attack, stroke or cancer. The lump sum is paid out whether or not the insured is unable to work; the diagnosis is the only factor.

Ever since the Superannuation Industry Supervision Act (SISA) in 1993, trustees of SMSFs have been allowed to purchase trauma cover for any member of the fund as long as a long list of requirements were met. However, this situation changed on 1 July 2014. Members who join an SMSF after 1 July 2014 are no longer eligible to have the SMSF purchase trauma insurance for them.

The SMSF can only insure a member for the following conditions

According to a recent study published at news.com.au,* the average Australian may be hard pressed to find extra income for superannuation contributions. The data would appear to say that Australians are spending most of their take home pay on necessities and don’t have a lot left over at the end of the month. But is that really the case?

Let’s take a look at what the study says first, then we’ll tell you what we see from a financial planner’s point of view.

By the Numbers

According to the study, 20.5% of the average Australian’s take home pay is spent on housing. This works out to $990 per month for every household in WA spending the most at $1249 per household and SA spending the least at $787. It must be remembered that these statistics include those living in regional areas.

Household bills are the next highest expense, weighing in at 15.5% or $633 per month. For the record, this number, which included power, telephone and Internet bills, surprised a lot of economists. Groceries averaged $531 or 12.1% of monthly income. Transport was $299, which worked out to 6.9%. Australians spent $174 or 4.2% on health expenses.

We offer advice for self managed superannuation funds (SMSFs) to a large number of clients in the Perth area. When gathering information and doing preliminary work with our superannuation clients, one of the first things we recommend is to find out whether or not they have any unclaimed super accounts.

Currently, there are over 6 million unclaimed super accounts in Australia, which are worth more than $18 billion, according to the Australian Taxation Office (ATO). Doing the math, that means the average unclaimed super account is worth around $3,000.

How to Lose a Super

Usually, a super fund or account gets lost because the fund provider can no longer locate or reach the account holder. An account holder can be an inactive member, they may have died or they may have changed addresses without notifying the fund provider. Some accounts are lost when the account holder moves out of country. Often, an account holder changes jobs and forgets about their super.

How to Find Your Unclaimed Super

The easiest way to find lost super is to contact the fund provider. This will require that you have information on file such as a past statement. If you don’t have a statement or aren’t sure, you can use an online service provided by the Australian Taxation Office called “Super Seeker.”

Why so many Australians are choosing to obtain a life insurance quote as part of their wealth protection protocol.

When deciding upon wealth protection products, many business professionals are focused on obtaining cover for their assets. Often, they have to be reminded that they have neglected one important asset: themselves.

As a business professional, you have worked hard to “climb the ladder.” No matter what path you have taken, your unique skill set, motivation and talent have enabled you to create a certain level of income. That income has provided for you and/or your family, allowing you to live the lifestyle you desire.

But have you thought of what would happen if you were no longer able to work? Have you thought of what would happen if you were to suffer a tragic accident or illness, leaving your family alone and without income?

We have. It’s what insurance companies do. Here is a quick overview of three basic life insurance products.