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End of year tax tips

All / 14.06.2018

End of year tax tips

For more information or to speak to one of our Financial Advisers – please contact TNR Wealth Management on 02 6621 8544.

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances
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If I was 25 again I would……be wary of investment fads

All / 08.06.2018

If I was 25 again I would……be wary of investment fads

Today it’s crypto-currencies like Bitcoin. In 2000 it was technology shares. In 1987 it was shares in general, and way back in the seventeenth century investors were going nuts over tulip bulbs.

When it comes to investment, fads occur when asset prices are driven up by irrational excitement, greed, and ‘FOMO’ – the fear of missing out.

The fundamental rules of valuing an investment fly out the window and speculation dominates trading as hoards get caught up in the frenzy before experiencing a crash.

While it may be difficult to resist the temptation to join in I would, instead, put my money only into investments that I understand; those with values based on a more realistic capability of generating long-term income and/or capital growth. I wouldn’t rule out the occasional small flutter on a ‘speckie’, but it would come out of my entertainment budget rather than being part of my core portfolio.

For more information or to speak to one of our Financial Advisers – please contact TNR Wealth Management on 02 6621 8544.

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances
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If I was 25 again I would… …pay extra off my mortgage!

All / 31.05.2018

If I was 25 again I would… …pay extra off my mortgage!

If I could find just $100 extra per month – less than the proverbial cup of coffee every day – and added this to my repayments on a $300,000 mortgage with an interest rate of 3.75% per annum over a term of 25 years, I would save $17,466 in interest, and shave more than two years off the term of the loan.

If I couldn’t make the extra payments regularly I’d aim to use any windfalls to pay down the loan. An additional $1,000 paid at the start of the same mortgage would save me $19,795 in interest over the term!

In practice, the easy way to do this is through a mortgage offset account. This would ensure all my savings, including the extra amounts I can find here and there, are working to reduce my total interest bill. And if interest rates rise, the savings will be magnified.

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances
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Get Ready for June 30 – NOW!

All / 24.05.2018

Get Ready for June 30 – NOW!

When it comes to getting the most (money) from your annual tax return, there is usually a lot to think about, so we’ve identified a few options that could open the door to some opportunities to save on tax.

The key here is to plan ahead.

Deductions — lower your tax liability

Pay now for some of next year’s expenses

If you have some spare cash available, paying for certain expenses before June 30 could mean you get your tax break back from the ATO earlier. Expenses paid in July could leave you waiting more than 12 months for the return. A popular expense in this category is prepaying interest on an investment loan, but be careful because not all expenses qualify for a tax deduction in advance.
This year the ATO is focusing on work-related expenses. If you are planning to claim expenses for things like a home office, mobile phone, tools and equipment, etc, make sure you claim only eligible expenses and have the paperwork to substantiate them.

Cash back for insuring your income

You can claim the premiums you have paid for your income protection insurance as a tax deduction. Note that you can only claim the portion of the premium that covers you for loss of income, not for any benefits of a capital nature. Premiums for other personal insurance cover such as life, critical care or trauma cannot be claimed. You also can’t claim deductions for premiums that are paid from your superannuation contributions if your policy is held in your fund.

Super contributions — don’t waste the limits

June 30 is not just about deductions for expenses. It’s also a good time to review your superannuation contributions to date and take advantage of the annual caps.

Salary sacrifice or concessional contributions

The annual limit for these types of tax-deductible contributions is $25,000 per annum, regardless of age. If you’re an employee, this limit covers both employer super guarantee and salary sacrifice contributions.

How much has your fund received in contributions so far this year? Do you need to review and adjust your current arrangements?

After-tax contributions

Anyone under 65 (whether working or retired) can contribute $100,000 each year to super as after-tax or non-concessional contributions. You can also contribute $300,000 in a single year by bringing forward the limit for the following two years. But – when it comes to super there’s usually a ‘but’ – check your total super balance to ensure any extra contributions do not exceed the general balance transfer cap of $1.6 million for 2017/18.

And one final point on super contributions – the total contributed is based on how much is received by your fund, not when you sent it to the fund. Another reason why planning ahead is crucial.

These are just a few ways to manage how your money is taxed. Depending on your circumstances, other options may be available. Your licensed adviser can work with you to help you achieve what is best for you this financial year. But please don’t leave it too late.

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances
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Boost your super before 30 June

All / 24.05.2018

Boost your super before 30 June

The end of the financial year is rapidly approaching and, along with it, the opportunity to claim a tax deduction on additional superannuation contributions.

Why contribute more to super?

Superannuation does impose restrictions on access to your money. It is, after all, intended to provide for your retirement. So why would you lock up more of your money? Because superannuation remains one of the most tax-favoured environments within which to build wealth. That can make it an ideal place to invest your long-term savings.

What are concessional contributions?

Concessional contributions are super contributions that have been claimed as a tax deduction by someone. They include employer contributions – both super guarantee and salary sacrifice – as well as personal contributions on which you may be eligible to claim a tax deduction.

How much can I contribute?

For the 2017/18 financial year the limit on concessional contributions from all sources is $25,000. For example, if your annual salary is $150,000 and you only receive super guarantee contributions, your employer will contribute $14,250 (9.5% of your salary) to your fund. That means you can make personal contributions of up to $10,750, and if you meet the eligibility terms, claim a tax deduction.

Entering into a salary sacrifice arrangement with your employer would achieve the same result. Based on the above salary, the maximum amount you could salary sacrifice is also $10,750, but you may not have enough time to do that this financial year.

When is the deadline and what paperwork is required?

Your contributions must be received and credited by your super fund by 30 June. To play it safe make your personal contribution at least two weeks before the end of financial year.
You must also notify your superannuation fund that you intend to claim a tax deduction for a personal contribution. Your fund may send you the appropriate form to complete or you can use form NAT 71121 available from www.ato.gov.au provide written notification to your fund. Your super fund must acknowledge receipt of this notice to make it a valid claim.

What if I’m approaching the cap?

If you’ve maxed out your cap for this year and your spouse’s income is under $40,000, you may pick up a tax offset of up to $540 by making a spouse contribution to their fund.

Need help?

Your financial adviser can help you work out how to make the most of your concessional contribution cap and explain the finer details. And if you miss this year’s deadline, talk to your adviser about putting in place a plan to ensure you take advantage of next year’s concessional contribution opportunity.

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances
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The Foundations of successful investing

All / 17.05.2018

Establishing an investment portfolio can be likened to building a home. The most destructive, yet unpredictable predator to the structure of a home is the weather. Even in these most technically advanced days, we are still unable to accurately predict the weather.

And so too, a man is a fool if he thinks he can successfully predict the future of the global economy. Like the weather it can be the most unpredictable and destructive threat to your investment earnings. But with a carefully built portfolio based on sound foundations, you have a much better chance of weathering a financial storm.

Investment principles

The foundations of a strong portfolio rely on four key ‘pillars’ or investment principles… quality, value, diversity and time.

We are probably all tiring of the old line, “don’t put all your eggs into one basket” – meaning to diversify your portfolio – but that is only one pillar on which to rely. The other three are equally important. Forget about just one and you are setting yourself up for a collapse.

Let us briefly explain why all four pillars are crucial to your investing success…

If we look at the first two pillars, quality and value, it’s obvious this means to look for assets that are expected to provide higher returns relative to their risks. Applying this to shares, quality companies should have a sound basis to their operations and growth; that is, their earnings are not driven by fads. This however, might mean they take time to deliver. Remember that investing in the share market is generally a long-term strategy.

Quality and value don’t always go hand in hand. Quality stocks may trade at such high prices that they offer low initial value or it could be that expectations for these companies are sometimes too high. The key here is quality… the expectation is that they will be around for a long time, not just a good time.

This takes us back to diversity. Diversity acts like the scales in a portfolio, providing balance. True diversity in a portfolio gives the investor the opportunity to take advantage of “hot stocks” or asset classes, whilst balancing out the risk with quality stocks and asset classes. It can provide a buffer against mistakes in assessing value because nobody gets it right all of the time. A well-balanced portfolio should be designed cope with occasional losses.

And finally, the pillar of time applies to the previous three. It can give you the best chance of success. Every market will suffer periodic downturns, however over time the upturn will always triumph. The golden rule is don’t panic and get caught up in the fear and greed cycle.

Make sure your investment portfolio is on solid foundations. Talk to your licensed financial adviser.

 

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.

 

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances.

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The Secret to “Living the Dream”

All / 11.05.2018

The Secret to “Living the Dream”

We all, to a greater or lesser extent, have an idea of our dream lifestyle. So how, as a nation, are we faring?

To find out, the Financial Planning Association of Australia (FPA) commissioned a survey of more than 2,600 people from around the country. The resulting Live the Dream report provides an insight into the extent to which we are collectively living our dream life and, more importantly, reveals key habits and characteristics of those who are already doing so.

What’s the dream?

Of course, everyone has a different concept of a dream life. However, across all age groups, three definitions topped the list:

  • having the lifestyle of my choice;
  • having financial freedom and independence;
  • having safety and security.

More specific aspects ranged across travel, family time, career and hobbies.

Are we living it?

Overall, just on a quarter of those surveyed are ‘definitely’ or ‘mostly’ living their dream. That may in part be due to the fact that most Australians are in the workforce and haven’t yet reached a point of true financial independence. Nonetheless, it reveals that there is a sizeable gap between the lifestyle that most of us are actually living and the one we want.

There’s no prize for guessing that a low bank balance is the number one barrier to having a permanent Nirvana lifestyle. Debt and a lack of time were the other major blockers.

Pursuing the dream

The good news is that there are some simple, key characteristics more commonly associated with those who are living their dream life. These people are more likely to plan – and to stick to those plans. They are more likely to seek advice from a financial planner. Interestingly, they are also more likely to meditate.

Age is a poor indicator of the extent to which we live our dream. Instead, the strongest influence revealed by the study was personality type.

Leading the race are the go-getters, with their big goals, clear idea of what they want in life, and a willingness to seek advice.

Bringing up the rear are the cruisers. They’re not great ones for forward planning but they are out there enjoying life now.

In between are the daydreamers and builders.

The number one solution

This doesn’t mean that the only solution for those not living the dream is to have a personality transplant! Personality is a fundamental part of who we are and most people display attributes from all of the personality types. Even the most dedicated cruiser will have a little of the go-getter lurking within. It’s simply a matter of nurturing the desire to go after your dream – and you don’t even have to do all the hard work.

According to Live the Dream the three most challenging aspects of planning are:

  1. not knowing what you want;
  2. finding the resources to help create a plan; and
  3. finding the time to plan.

Even before a plan is made, almost a quarter of those surveyed know they wouldn’t stick to it anyway.

If those seem like insurmountable barriers, then talk to someone who lives to plan – a qualified financial planner.

He or she can help you define your particular dream, identify the steps to achieve it, and save you time. And stay close by to keep you committed.

Once in place, your planner can nurture your inner go-getter, helping you step-by-step so that soon you won’t just be planning the dream, but living it.

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances.

 

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If I was 25 again I would… …pay more attention to my super!

All / 03.05.2018

I would take mental ownership of it rather than thinking it’s just something for old people to worry about.

First up I’d consolidate all of my super into one account to avoid paying multiple sets of fees. I’d also check to see if I was paying for insurance that I may not need at the moment, and if it offered the best deal on income protection insurance. I’d seek professional guidance to review the investment mix and whether it was appropriate for my long-term savings goals.

And despite all the other things I want to do with mylife before retiring, over the years I’d keep a close eye on my contributions to ensure my employer is paying what they should, and watch the balance grow to a big enough nest egg to give me financial independence by the time I eventually retire – if I ever want to!

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.

 

Disclaimer
Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances.

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How Might the weather affect your investments?

All / 26.04.2018

The disastrous weather we’ve witnessed in recent years has many people wondering what to expect next. The seemingly end-to-end storms, bushfires, floods, and other devastating weather events prove to us that nobody can be 100% sure of how things will turn out over the coming years, let alone the coming weeks.

The climate change debate is always heightened by these events but regardless of your view on this matter, the weather can play a major part in investing.

For example, many industries may be forced to make expensive modifications to business practices to meet new standards, and scores of individual businesses may perish if they cannot adjust. At the same time, changes in consumer demands and sources of economic value can provide new opportunities.

For both professional and individual investors it is crucial to recognise the various impacts of the climate on the companies or funds that they are invested in or will potentially invest in. For example:

Energy sources and the price of coal

Coal has been a cheap way to generate electricity, but many argue that this won’t be the case once the ‘real’ cost is taken into account (ie. the environmental impact of burning coal). As new technology is increasingly taken up across the world, more companies are specialising in wind, solar and geothermal energy. With the cost of coal-fired power being shared among less users, and hence consumers consistently seeing their electricity bills rising, they may be further inclined to seek more energy-efficient methods.

Impact of drought on the agricultural sector

Drought is a way of life for many Australians on the land so we should never get complacent about water supply. Water scarcity leads to lower crop yields and/or higher prices for food products. Farmers are responding through demand for technologies that enhance their yields or enable better water usage and recycling.

Rising sea levels

Higher global temperatures and the consequent rise in sea levels will most obviously impact on the lifestyles of coastal communities. As a result, we could see new demands for infrastructure that is suitable for the ‘new environment’. The effects on fisheries and various ecosystems may lead to increased opportunities in farming and, again, technologies that enable these ecosystems to adapt.

Extreme weather and the effect on insurers

Insurance companies aim to be adequately compensated (via premiums paid by policyholders) for the risks they are taking. The increasing claims over recent years have affected premiums, particularly in regional areas, which may create opportunities for improved building standards and materials as consumers seek to better weather-proof their properties.

One thing that won’t change is the fundamentals of good investment decisions. The changing climate will result in many winners and many losers, and the prudent investor will be seeking to choose the right place to invest.

So the next time you’re chatting to your adviser about the weather, ask them how it could affect your portfolio.

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.


Disclaimer

Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances.

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How much do you know about investing? Take our quiz to discover the basics of investing and some often misunderstood terms.

All / 19.04.2018

Investing is normally a topic that conjures up images of pin-striped executives and sophisticated financial markets.

But, in reality, the act of investing is part-and-parcel of our daily lives; all of us are doing it throughout the day, though we might not consciously stop to think about it.

By exercising and pursuing good eating habits, we invest in our health; taking good care of our families and looking out for friends is an investment in our relationships; and, commitment to education is an investment in our future.

These are but a few examples and many more can be found. The point is that – as a way of life – we consistently invest time, effort and other resources in matters that are important to us.

The largest investment for most of us is the countless hours spent on earning a living; a substantial part of our lifetime is absorbed by working to make ends meet.

 

Consider this basic truth: there are only two ways to earn a living – you must work for your money, or your money must work for you.

It’s important that our money works hard for us; both, on the way to financial independence, and thereafter, so that we can comfortably maintain the quality of life that we have become accustomed to.

So how does your financial savvy stack up right now? Try this quick quiz to find out.

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