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Why many investors choose industry super funds over SMSF—and why many don’t.

There are as many situations as there are individual investors. SMSFs, or “Self Managed Super Funds,” have become a popular choice among individual investors and small groups of investors, while industry super funds have also become a popular choice for individuals. While there are plenty of other choices such as retail funds, this article will explain the difference between SMSFs and Industry Super Funds

So, which one is better? It depends upon your situation. While we always recommend seeing a superannuation professional for advice, we would like to offer some general guidelines to give you a better idea of what to expect when you have your first consult with a financial planner about superannuation.

Control

Changes in superannuation regulations have allowed a lot of Australians to take the opportunity and exert control over their super funds. An SMSF allows for a lot more individual control than an industry super fund does. While the industry super fund is basically a passive investment that requires no effort on your part, an SMSF will require you to be a trustee of your own fund. That makes compliance and risk your responsibility.

Many Australians carry both trauma cover and total disability insurance (TPD). Here’s why.

Although trauma cover and total disability insurance (TPD) are similar, they are designed to produce two different outcomes. That makes it important to understand what both coverages do and what they don’t do.

Trauma Insurance: the Basics

Trauma insurance is taken out for specific illnesses. It pays out a lump sum if you are diagnosed with that illness. The lump sum is designed to help you take care of your financial responsibilities while you recover: both your standing expenses and new expenses such as rehabilitation or carers. Ideally, you are able to fully recover and get back to living your life with no severe financial consequences.

Trauma insurance covers such illnesses as cancer, heart attack and coronary bypass surgery. The illnesses are very specific and are defined within your insurance policy so that you know exactly what occurrences will result in benefits and what ones won’t.

Finance broker provides tips to help simplify and refine the process of investing.

Investing can be confusing for those who aren’t “in the business.” Today’s investment landscape is fraught with pitfalls for an inexperienced investor trying to “go it alone.” Though we always recommend going to a professional finance broker, here are some investment basics.

Slow and Steady Wins the Race

Often, investors risk their chances of long-term success for short-term gains. Here is how the investment market works: when somebody wins short-term, somebody else loses. But over time, most people who stay in long term with solid investments “win” as the market grows. Long-term investing can give you peace of mind in the short term.

Diversification

We can only provide general concepts here and not individual advice. However, we can say that we encourage our clients to diversify their investments. Today’s “hot investment” can be tomorrow’s “cold fish.” There is security in diversification.

A basic guide with facts that can help you compare income protection insurance.

Income protection insurance is designed to help provide funds for you and your family in case you are unable to work for an extended period of time. Illness or injury can create a lot of unanticipated expenses, compounded by the fact that you are unable to produce income. You may have to take part in expensive rehabilitation and even reformat your home to make allowances.

Your spouse may have to take time off work to assist you in your recovery or you may have to hire a full time nurse. In addition, your daily household expenses are still there, such as groceries, utility bills, mortgage repayments and car loan repayments. With no income, this could be crippling to your finances. Luckily, protection is available in the form of income protection insurance.

The Elements of Income Protection Insurance

To compare income protection insurance policies, you need to know some basic facts. There are two main points that you will compare: the amount or percentage of your income that you will want to receive if you are unable to work for an extended period of time and the length of time you would like to receive it.

Useful facts about maximising your superannuation guarantee and securing your future.

At Approved Financial Planners, we are experts at helping you maximise your super funds to help ensure a comfortable retirement. Consequently, we always recommend seeing a professional financial planner such as those in our Perth office to look at your individual situation and make recommendations.

However, we can give you some general advice and information to help you prepare for your first visit. Here are some useful facts about your superannuation guarantee and how they relate to the typical Australian. All of this information is available on the ATO website, though in a slightly more complicated form.

As of 1 July 2014, your employer must contribute 9.50% of your income to your superannuation fund. This number will increase by 0.5% each year until 2019, when it will have reached 12%.

To be eligible for superannuation guarantee, you must make at least $450 per month. If you are less than 18 years of age or work in a domestic capacity, you must work 30 hours per month, in addition to making $450, to be eligible. As of July, 2013, those who are 70 years of age and over are now eligible for the superannuation guarantee.

How the financial planning process can help you control your future without adversely affecting your current lifestyle.

We often refer to financial planning as a product. In reality, though, it is a process in which your finances are managed in the short term to produce long-term gains and financial security. A great financial planner can not only help you achieve your long-term retirement goals, but also make sure that you are prosperous enough to enjoy your life on the way to retirement.

To this end, the financial planning process usually involves three phases: risk management, wealth creation and retirement planning.

Risk Management

Risk management involves insuring yourself and your investments to mitigate the risk of losing them if you suffer a permanent injury, severe traumatic illness, premature death or any other circumstance that may prevent your financial plan from reaching fruition. Your financial planner will discuss various covers with you and work with you to ensure that you, your family and your assets are protected in the case of any unforeseen illness or injury.

Why income insurance is an important part of protecting a subcontractor’s assets.

Subcontractors find themselves in a unique position. They don’t have a boss or a regular paycheck, meaning that they don’t have access to workers’ compensation or sick leave. If they become too sick or injured to work, they don’t have a financial “cushion” upon which to lean on. That is why many purchase income insurance, or “income protection insurance.”

How Income Protection Insurance Works

Simply stated, if you are hurt or ill and unable to work, income protection insurance can replace as much as 75% of your income until you are able to go back to work. This comes in handy for feeding your family and paying bills while you are unable to produce income through working.

Every income protection insurance policy has three parts:

Benefit Amount

This is the amount of money you will

Can astute financial planning, such as an AMP Super Fund, help quell fears of Australian men worried about their retirement?

The Survey

Recently, The Digital Edge conducted an exclusive survey for News Corp Australia, entitled, “Men and Money.” 1,000 men from various parts of Australia were surveyed on the impact of financial difficulty on their lives. The survey participants were from diverse backgrounds, but there were many commonalities in their answers, much to the surprise of those conducting the survey.

The biggest takeaway: one out of three men said they had difficulty living on their current incomes. In South Australia, that number jumped to 49%. More than 50% of those who responded feel that they are under “financial stress” 365 days a year. Lack of savings, current expenses and the spectre of future expenses were most often cited as the sources for stress.

Close to 70% of the men surveyed said that financial stress had led to problems with their health or relationships at least once in their lives. Loss of family, depression, drinking, heart problems and even thoughts of suicide were among the most common complaints.

One common theme was that those men who allowed themselves to be interviewed on the record said that they were more likely to keep their worries to themselves as opposed to burdening their spouses.

The best way to understand life insurance is to realise that there is nothing to be afraid of when discussing it.

By its very nature, life insurance can be scary because it involves accepting one’s mortality and setting affairs in order to protect them from the aftermath of events that nobody likes to talk about. This scares a lot of people off and keeps them from learning what they need to know about life insurance.

Did you know that many policies actually help support you in your recovery when you are stricken by a major illness or life event involving injury? Here are some various types of life insurance products.

Two Basic Classes of Life Insurance: Temporary and Permanent

Temporary

Temporary life insurance is purchased for a fixed period of time, such as twelve months. When the term is over, you renew the policy or purchase a different one. Insurance policies classified as temporary are seen as providing greater flexibility and are the more popular of the two classes.

What aspects of finance can be improved by financial planning and why superannuation regulations in Australia can be difficult to navigate without qualified help.

Many Australians ask whether or not they need a financial planner. While we cannot give blanket advice to anyone, we can give you an idea of situations in which a financial planner can be helpful. Ultimately, the decision of whether or not you need a financial planner is yours to make. Here are some services we provide that may be difficult to perform on your own.

Retirement Planning

Different people attach different meanings and goals to the word “retirement.” A financial planner can help you formulate a customised retirement plan that can help you retire with the income that you want. The sooner you begin planning for retirement, the easier it is to get you there with the lifestyle you want to live.

Superannuation

Superannuation is designed to provide Australians with a vehicle for investing in and saving for retirement. A good superannuation strategy can help you maximise tax concessions in conjunction with any government benefits you may or may not be receiving to ensure a comfortable retirement.