Superannuation Tips – Part 2 of 2

If you are running your own self-managed super fund (SMSF) or thinking about starting one, there are some useful tips to ensure you maximise your time, effort and money.

Tip 4: Keep your deed updated• Your trust deed is the most important document in your SMSF; it sets out the rules and relevant legislation to your investments.
• Ensure your trust deed is current and up to date at all times.
• Regularly check that your deed is up to date with current legislative requirements.

Tip 5: Establish templates for trustee minutes
• It is best practice to minute every decision made by trustees, having a template ready makes this very easy.
• Invest the time to create templates for trustee minutes so that when you need to take minutes, everything is read.
• Ensure your template includes areas to record information such as accepting contributions, paying a pension, accepting the financial statements and appointing an auditor.

Tip 6: Corporate trustees are worth the extra money
• If an SMSF member decides against being a trustee, this role is assigned to a company with themselves as directors.
• Having a corporate trustee has a huge number of benefits including:
o Simplifying share registry information
o Simplifying managed funds application forms
o Requiring only 2 members of the corporate trustee to sign share registry, managed fund and other documentation
o Having the ability to run a sole member fund under the corporate trustee
o Simplifying estate planning

Tip 7: Keep your direct holdings in the CHESS system• The CHESS system allows you to manage your ASX investments
• As you can now buy a wide variety of investments from the ASX including shares in large/small/medium companies, fixed interest products such as LICs and ETFs and even geared investments such as warrants.
• CHESS is a cost free wrap/administration account.
• It is still easier to deal with a single broker, even when using CHESS to administer your portfolio.
• However, if you choose to change brokers, it can usually be done in about a week.
• Having CHESS to help administer this process can help streamline the process and help you keep control of the change.

If you missed our SMSF Tips Part 1 – read it here.

If you have any questions about starting or managing a SMSF or indeed planning for your retirement, please call for an appointment with one of our superannuation experts.

Interest rates & property valuations rise

Everywhere you look at the moment there is a media story about rising property prices. After the downturn in the market that coincided with the global financial crisis, the Australian property market is again moving upwards.

I believe that there will be a 6% increase in property valuations in 2010. On top of that I expect several more interest rates rises, across the year. What does this mean for you?

Firstly, if you already have your home loans structured by Future Assist, the interest rate rises will have a minimal impact. Only the component of your loan that is variable will be affected. The repayments on this portion of your loan will increase incrementally. If you have investment property loans then the same applies.

If you are seeking to move into the investment property market then now is a prime time to begin developing your portfolio.

The best way to start or grow your property portfolio is to speak to professionals who understand not just property but loan structures and finance options to ensure you have the right investment strategy and get the best returns.

For further information about property investment or loan advice, call for an appointment with one of our experts.

Superannuation tips – Part 1 of 2

Did you that that by the end of next year there will be more than half a million self-managed super funds (SMSF) in Australia? Here are some tips to make sure you make the most of your self-managed superannuation.

Tip 1: Keep a superannuation diary
• Any diary will do but use it to keep track of all of your contributions going in and income payments going out.
• When you make an investment make a note in your diary about why you did and your thinking behind making this specific investment.
• This will be handy when you’re assessing how successful the investment was further down the track.

Tip 2: Only have one central bank account
• Some trading platforms give a bigger discount if you use one of their linked bank accounts. While the discount is good, having more than one bank account can be confusing.
• Have just one bank account to easily keep track of contributions, withdrawals and pension payment, buys, sells, distributions and interest earned.
• Having all this information in one place makes reconciliation much easier and less time consuming.
• Many accounts allow for notes to be added to each transaction, allowing you to easily see the whole history.

Tip 3: Have an investment strategy
• Every self-managed super fund (SMSF) must have an investment strategy as a part of compliance obligations.
• Don’t just have a strategy that meets compliance obligations.
• Have a strategy that you can actually use to drive your superannuation savings!
• Your investment strategy should cover how the funds are allocated and how they are managed.
• This will ensure your superannuation funds are invested in the right way to achieve your financial goals.

If you have a lot of funds as cash or a mismatch in the investment types, your superannuation strategy may not being working to meet your financial goals. Talk to us about developing a detailed, workable investment strategy.

We’ve got more tips on how to make the most of your superannuation in the January newsletter. Or you can speak to one of our investment planning consultants today.

What’s so important about Estate Planning?

It is estimated that half of all Australians who die do not have a current, legal will. This can have serious repercussions for the surviving family in at a most difficult and emotional time.

When someone dies without a will (intestate), there is no guarantee that assets will be distributed as that person would have intended. The Public Trustee is then appointed as the executor of the estate to oversee the distribution of assets.
If you have a family, own property or have had a recent change in your financial or personal circumstances you need to have a current legal will.

Estate Planning is an essential element to planning for you and your family’s financial future. The Future Assist in-house Estate Planning experts are available to ensure that your legacy is protected and distributed in accordance with your will. Call us on 1300 118 618 to arrange a meeting with our Estate Planning team.

Should I invest in property?

The property market and interest rates are hot topics at the moment. As we predicted in September, there are several more rate rises on the cards and this will affect home loan repayments for all home owners and property investors.

Investing in property is one method of securing a robust financial future. Purchasing an investment property is different to purchasing a family home. Investment decisions need to be unemotional and calculated to ensure the best possible investment return. This is where expert knowledge and experience makes a difference.

After many years experience investing in property we have devised a formula that evaluates the viability of a property from an investment perspective. Our process of evaluating properties for investment is based on research, data, opportunity and of course, common sense. This ensures the emotion is removed from the decision. By following this process, the risks often associated with property investment is reduced.

Should everyone invest in property?
This is a question that is often asked. Property investment is just one method of creating wealth. To understand if property investment is right for you, a financial plan is essential. Everyone has different goals and appetites for investment. Property investment may be a perfect fit for your financial plan, but if not there are many other investment options available.

For example, Property Trusts allow investors to enjoy the financial benefits of property investment without investing in individual properties, finding tenants and managing the property upkeep.

Property Trusts invest in diversified properties ranging from retail, office and industrial real estate. Shares in the Trust are made available to investors. This allows investors to benefit financially from the property market with their money spread over a range of properties and without the need to manage and maintain the properties themselves.

If you, or someone you know is considering investing in property, call us on 1800 118 618 for an obligation free conversation to determine if it’s the right path or indeed, the right property to achieve your financial goals.

Accountancy & tax planning now available

A critical factor of financial success is having sound accounting and tax planning advice from qualified and diligent professionals. Future Assist now has accounting and tax planning services of Certified Practicing Accountants (CPA) available to our customers.

Ensuring your accountant provides you with the best ways to manage your business or personal finances is one of the soundest investments you can make.

If you, or someone you know requires independent and professional advice on business or individual accountancy, business partnerships, superannuation, tender preparation, cash flow management and even basic book keeping services then have them contact us on 1300 118 618.

And don’t just settle for a “tick-the-boxes” approach to your tax return. A CPA is a highly qualified professional that is proactive in providing you with the best advice and methods to ensure you pay the right amount of tax and maximise your returns.

Advice and guidance on land tax, fringe benefit tax, capital gains tax, payroll tax and family trusts is also available. Call us on 1300 118 618 to discuss your accounting or tax needs. See what a difference professional tax services can make to your financial future.

What’s going on with interest rates?

There is a lot of speculation in the media at the moment around interest rates. After the significant rate cuts that took place in the past year, the Governor of the Reserve Bank has told a parliamentary inquiry that borrowers should brace themselves for rate rises of up to 2%. No time frame was given but it is not expected that rate increases will come as quickly as the recent rate cuts.

What’s driving this change of direction?

Essentially Australia is not experiencing as deep a recession as other countries, house prices are rising, as is the cost of living. All of these factors mean that inflation is above where the Reserve Bank would like it to be.

Inflation is simply the change in the level of prices of goods and services. When prices are high, our dollar buys fewer goods and services. When prices are low, we can buy more. The inflation rate is measured by the change in the Consumer Price Index (CPI) over time. The CPI estimates the cost of goods and services in the average household as a percentage. Inflation levels in Australia are still above the desired 2-3% range.

What does this mean for you?

If Future Assist has refinanced your home loan then an increase in interest rates will change some of the repayments you are making. Your home loan has been restructured to ensure that you have the maximum flexibility and capacity to make repayments even in the event of interest rate increases.

When interest rates increase the repayments for the fixed rate element of your home loan will not change.  The repayments for the interest-only and line of credit components of your home loan will increase when your lender lifts their rates.

If you have any questions about how changes in interest rates will affect you, please call us on 1300 118 618.