As 2022 begins, James Fitzgerald has 22 tips for taking control of your finances and becoming a savvy investor.

#1: Build positive habits

Start the new year by building positive habits around your money – whether it is saving, spending or investing. Identify productive behaviour and take action to stick with it. Commit to 21 successive days of repeating a new habit and you are likely to retain it.

#2: Healthy body, healthy mind

Make the first hour of the day just for you. Wake up early and get your heart going.

#3: Think about what motivates you to save money and build wealth

What do you want? How will your wealth benefit others as well as you? When you have worked that out, it will motivate you to achieve your goals – and when things become challenging it will help you focus again and keep going.

#4: Manage your screen time

The average Australian spends 5.5 hours a day looking at their smartphone alone. Having good habits around screen time is essential to avoiding burnout and attaining and sustaining success. Try to turn off your phone for two hours before bedtime and on at least one day of the weekend.

#5: Set small goals and reward yourself when you meet them

Chart your progress to remind yourself how far you have come. Remember, no-one gets rich overnight.

#6: Know where your value lies

Understand that the value in real estate investment is in the land, not the house that sits on it. Land values will always increase more than the building, which generally decreases in value as it gets older. For that reason, land with a house on it is a better investment than an apartment.

#7: Find a mentor

Ask someone who is financially successful and who has values and beliefs that fit with yours if they will mentor you. It could be a family member, friend, work colleague or neighbour. Catch up with them for coffee or a sandwich every now and then and ask them to help you better understand how to be successful with money. 

#8: Know the power of cash over cards

It’s not fashionable to use cash any more, but by withdrawing cash each week for your discretionary expenses (eating out, drinks, coffees, movies), you can curb your spending. Once it’s gone, that’s it. Keep track of how much you are spending and eliminate random spending.

#9: Streamline your bank accounts

Set up three accounts: an everyday account, a ‘future’ account and an emergency account.

Get your salary deposited into the everyday account and pay your day-to-day expenses out of it. Set up the ‘future’ account with a different bank and set up an automatic transfer of 10 per cent of your pay into this from the everyday account. The emergency account should be similar to the ‘future’ account but used only for one-off expenses that pop up during the year, such as medical bills, insurance and holidays.

#10: Supercharge your savings

Do some overtime, take a second job or ask for a pay rise. Then try to increase your savings allocation from 10 per cent to 15 or even 20 per cent. It will make a huge difference!

#11: Start earning better interest

If you have managed to save $10,000 or more, place it in a term deposit so it starts earning some interest. 

#12: Look after your mental health

Lack of control over personal finances can cause enormous stress and worry. Seek professional help if you are suffering from anxiety or depression. A problem shared is a problem halved.

#13: Keep the cash flow steady

Cash flow is like oxygen. Invest in assets that pay for themselves. Don’t let the holding of your investment exceed 10 per cent of your take home pay.

#14: Review your home loan interest rate

Is it time to switch from variable to fixed rate? It’s a good idea to fix your home loan for your principal place of residence. Even saving half a per cent each year will add up to good savings and potentially take years off your mortgage.

#15: Put your ‘team’ in place

To be a successful investor, you need a good accountant, mortgage broker or banker, property manager and mentor. These people will be crucial to your success.

#16: Learn to use other people’s money to get your start in investing

This might be a bank’s money (a loan), or borrowing from family or friends for a deposit on your first property (but make sure you have a written agreement).

#17: Get the grants

Investigate any government grants or concessions you are eligible for, such as first home-buyers grants, concessions on stamp duty or other financial assistance packages.

#18: Differentiate between your ‘needs’ and your ‘wants’

We need food and a roof over our heads. We don’t need an Xbox, concert tickets or an expensive new handbag. Make a conscious decision to be disciplined about what you spend money on.

#19: Detox from your subscription services

Even spending less than $10 a month on pay TV services can add up – especially if you have three or four! You could even cancel all your cards and order new ones to force a reset on all those commitments.

#20: Be a reader

Learning through reading is a powerful habit. Expand your knowledge on things financial and otherwise.

#21: You are who you hang with

Spend time with like-minded people who aspire to do well in life. The theory is that you will be as successful as the average of the 10 people with whom you spend the most time.

#22: Don’t wait

If you’re fortunate enough to be in a position to invest in something today, do it. As the past two years have shown us so clearly, you never know what’s around the corner… 

Contact us today if you’d like help to taking control of your finances. Call us on Phone: 07 5641 4134.

Source: Flying Solo January 2022

This article by James Fitzgerald is reproduced with the permission of Flying Solo – Australia’s micro business community. Find out more and join over 100K others https://www.flyingsolo.com.au/join.

Important: This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business, nor our Licensee take any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) ac www.flyingsolo.com.au

In 2021, customer experience is king and there are lots of ways you can give yours a boost, writes Jason VandeBoom, Founder and CEO, ActiveCampaign.

Have a great product or service but not seeing as many customers as you’d like coming, or returning, through the doors? Chances are it’s your customer experience, not your core offering, that’s holding your small business back.

What is customer experience?

The term customer experience is used to refer to the way in which a business engages with its customers at every stage of their joint relationship. Research suggests that, in 2021, it’s very often the thing that will most determine whether your business sinks or swims.

So much so that companies that invest in customer experience can double their revenue in three years, according to one 2018 study.

Lessons from the top end of town

Some large enterprises have it down pat. KPMG’s Customer Experience Excellence Report 2020 salutes the standout efforts of one of Australia’s biggest bottlers, First Choice Liquor, during the dark days of the pandemic.

‘[Survey] respondents noted that First Choice Liquor got the basics right over that last 12 months, with customers highlighting product range, availability, value for money and an enjoyable purchase experience led by friendly, cheerful and helpful staff,’ KMPG noted, upon launch of the report in September 2020.

Putting the customer at the heart of what they do is now a must for local organisations, added Sudeep Gohil, Partner, KPMG Customer, Brand and Marketing Advisory.

“Australian businesses must leverage their ability to adapt and be resilient, embrace technology and trust their teams to put their customers’ needs first and foremost. This will bear fruit long after the pandemic is over,” Gohil commented.

So, how can smaller concerns emulate the success of their larger, better-resourced competitors? Here are five ways you can amp up the customer experience on offer in your enterprise.

Go omni-channel

Before the pandemic, a whopping 59 per cent of Australian businesses with 20 employees or fewer didn’t have a web site, according to GoDaddy. Thousands were forced to build one on the hop, after Covid shutdowns made business as usual a major challenge for bricks and mortar only enterprises. In today’s times, a strong online presence is a must because Australian consumers have come to expect the businesses they deal with will be omni-channel – that is, ready, willing and able to provide slick and seamless service in both the real life and virtual realms.

Surprise and delight

‘Going the extra mile’ is a well-worn cliché but if you’re in business for the long haul, doing so can pay off in spades. Whether it’s an after-hours delivery, a birthday bonus gift or just stand-out service when customers visit your premises, surprising and delighting won’t only guarantee repeat custom. In today’s ultra-connected times, it may also see customers become digital brand advocates, spreading the good word about your business on their social channels.

Automate your customer experience

On the sales and marketing front, genuinely 1:1 customer experience can be difficult to deliver, unless your customers number in the tens. That’s where automation technology can help. Today’s platforms make it easy to aggregate customer data from multiple sources, segment prospects and customers into discrete groups and connect with them via personalised messaging and campaigns that address their particular needs and interests. It’s a far cry from the  impersonal direct marketing approach so common in the past, and far more likely to secure sales too.

Reduce friction in your customer experience

Good customer experience is about making dealing with you seem effortless. Listen to the now famous words of the world’s largest online retail boss, Amazon founder Jeff Bezos: “The best customer service is if the customer doesn’t need to call you, doesn’t need to talk to you. It just works.”

What works for a whale, like Amazon, will also work for small businesses. Looking for instances of friction – think clunky mobile websites or an online ordering system that’s difficult to navigate – and working to eliminate them will make customers more likely to come back to you, again and again.

Listen and learn

Pride yourself on asking customers for their feedback? Many businesses do but what they go on to do with it is, all too often, very little. That’s to their detriment because all feedback is useful. Comments and customer satisfaction scores that reflect poorly on your enterprise are especially valuable, provided you’re humble enough to hear about the things you haven’t done well. Taking it on the chin, and taking action to ensure you do things differently or better next time, will help your business lift its game, at a time when doing so has never been more important. 

Source: Flying Solo October 2021

This article by Jason VandeBoom is reproduced with the permission of Flying Solo – Australia’s micro business community. Find out more and join over 100K others https://www.flyingsolo.com.au/join.

Important: This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business, nor our Licensee take any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) ac www.flyingsolo.com.au

Owing money or falling behind on repayments can be stressful. The good news is there are steps you can take to relieve the financial pressure.

If you’re in crisis and struggling to buy food and pay for essentials, see urgent help with money. 

1. Know what you owe

The first step is to get a clear picture of what you owe.

Make a list of all your debts, showing:

• how much each debt is

• the minimum monthly repayment (if any)

Include credit cards, loan repayments, unpaid bills, fines and any other money you owe.

Then add up all the debts to see how much you owe in total. It may be confronting, but remind yourself that you’re taking charge of your money. And that’s a good thing.

2. Work out what you can afford to pay

The next step is to work out how much you can afford to pay towards your debts.

Compare money in and money out

The easiest way to do this is to do a budget.

List all the money you have coming in each month (income), such as salary or benefits. Then list all the money going out (debts and expenses), for things like food, rent or mortgage, credit cards, electricity, phone and transport.

Tally these up, then compare money in and money out.

Maximise your entitlements and find savings

If your income has dropped because of the coronavirus, check if you’re eligible for extra Government financial assistance.

If you have more money going out than coming in — it’s time to make some choices. Think about what are:

• ‘needs’ (can’t do without)

• ‘wants’ (could do without, at least for a while)

Identify some expenses that you can cut or reduce. Be realistic — don’t make it impossible to stick to. See living on a reduced income for ways to reduce your spending.

3. Prioritise your debts

Work out which debts are your priority debts and try to pay them first if you can. Priority debts include:

• rent or mortgage payments

• council rates and body corporate fees

• electricity, gas and water

• car repayments — if you need your car for work or essential travel

If you can’t keep on top of these you can request financial hardship. You could also request financial hardship for lower priority debts like:

• internet and phone bills

• credit cards

• payday loans or consumer leases 

The National Debt Helpline has a step-by-step guide and can help you to prioritise your debts.

4. Build a savings buffer

Use any surplus you have each week to build an emergency fund. This will provide a financial safety net to cover any unexpected expenses or future changes to your income.

5. Get help if you need it

Before you jump into anything, talk to us on Phone: 07 5641 4134. We can explain your options and help you make a plan.

Source: moneysmart.gov.au
Reproduced with the permission of ASIC’s MoneySmart Team. This article was originally published at https://moneysmart.gov.au/managing-debt/get-debt-under-control

Important note: This provides general information and hasn’t taken your circumstances into account.  It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.  Past performance is not a reliable guide to future returns.

Important
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

Two steps forward, one step back

For the second year running, the pandemic was the focus for policy makers, markets, businesses, and individuals alike.

The year began with hopes that the rollout of vaccines would stem the spread of COVID-19 and allow economies to reopen. Instead, most countries were hit by wave after wave of the virus, periodic lockdowns, and ongoing disruption to lives and livelihoods.

Yet there were also positives. Australia’s vaccination rate exceeded all expectations while property and share markets soared. Investors who stayed the course enjoyed double digit returns from their superannuation, with the median growth fund tipped to return more than 12 per cent for the year.ⁱ

The big picture

If the pandemic has taught us anything, it is to expect the unexpected as new variants of the coronavirus – first Delta and now Omicron – hampered plans to return to a ‘new normal’.

Yet through it all, the global economy picked up steam. In the year to September the two global powerhouses the US and China grew at an annual rate of 4.9 per cent, while the Australian economy grew by 3.9 per cent.

The Australian economy is estimated to have grown by more than 4 per cent in 2021, with unemployment falling to 4.6 per cent ahead of the Christmas rush.

But challenges remain. As global demand for goods and services picked up, ongoing shutdowns disrupted manufacturing and supply chains. The result was higher prices and emerging inflation.

Inflation and interest rates

Australia’s inflation rate jumped from less than one per cent to 3 per cent in 2021. This is lower than the US, where inflation hit 6.8 per cent, but it still led to speculation about interest rate hikes.

The Reserve Bank insists it won’t lift rates until inflation is sustainably between 2-3 per cent, unemployment is closer to 4 per cent and wages growth near 3 per cent. (Wages were up 2.2 per cent in the year to September.) The Reserve doesn’t expect to meet all these conditions until 2023 at the earliest, but many economists think it could be sooner.

While Australia’s cash rate remains at an historic low of 0.1 per cent, bond yields point to higher rates ahead. Australia’s 10-year government bond yields rose from 0.98 per cent to 1.67 per cent in 2021.

Shares continue to shine

Global sharemarkets made some big gains in 2021 on the back of economic recovery and strong corporate profits. The US market led the way, with the S&P500 index up 27 per cent to finish at near record highs.

European stocks also performed well while the Chinese market suffered from the government’s regulatory crackdown and the Evergrande property crisis.

In the middle of the pack, the Australian market rose a solid 13.5 per cent in 2021. The picture is even rosier when dividends are added, taking the total return to 17.7 per cent.ⁱⁱ

Volatile commodity prices

As the global economy geared up, so did demand for raw materials. Commodity prices were generally higher but with some wild swings along the way.

Oil prices rose around 53 per cent, thermal coal prices soared 111 per cent and coking coal rose 37 per cent. Australia’s biggest export, iron ore, fell 25 per cent but only after hitting a record high in May.

Despite demand for our raw materials and a sound economy, the Aussie dollar fell from US77c at the start of the year to finish at US72.5c, providing a welcome boost for Australian exporters.

Property boom

Australia’s residential property market had another bumper year, although the pace of growth shows signs of slowing. National home prices rose 22.1 per cent in 2021, according to CoreLogic. When rental income is included the total return from property was 25.7 per cent.ⁱⁱⁱ

Regional areas (up 25.9 per cent) outpaced capital cities (up 21.0 per cent), as people fled to the perceived safety and affordability of the country during the pandemic. Even so, prices were up in all major cities.

Looking ahead

The pandemic is likely to continue to dominate economic developments in 2022. Much will depend on the supply and efficacy of vaccines to protect against Omicron and any future variants of the coronavirus.

Financial markets will also keenly watch for signs of inflation and rising interest rate. In Australia, inflation is likely to be constrained while wages growth remains low, and the Reserve Bank keeps rates on hold.

The wild card is the looming federal election which must be held by May. Until the outcome is known, uncertainty may weigh on markets, households, and business.

Start the year off with a plan to invest. Call us today on Phone: 07 5641 4134.

i https://www.chantwest.com.au/resources/remarkable-a-10th-consecutive-positive-year

ii https://www.commsec.com.au/content/dam/EN/Campaigns_Native/yearahead/CommSec-Year-In-Review-2022-Report.pdf

iii https://www.corelogic.com.au/news/housing-values-end-year-221-higher-pace-gains-continuing-soften-multi-speed-conditions-emerge

Unless otherwise stated, figures were sourced from Trading Economics on 31/12/21

The information (including taxation) is general in nature and may not be relevant to your individual circumstances. You should refrain from doing anything in reliance on this information without first obtaining suitable professional advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) before making any decision to acquire a product.

Retirement villages in Australia offer residents a unique range of retirement living options, including accommodation options, facilities and services. Many retirement villages feature pools, golf courses, regular social events and 24-hour emergency assistance. 

For many people, retirement is a new and exciting stage of life where you can relax after years of hard work, take part in a range of social activities or travel around the world. How you want to spend your retirement is the first thing we think of, but a question that is just as important is where to spend retirement.

More and more people are opting to live in retirement villages around Australia. There are currently more than 2300 retirement villages around the country with 185,000 seniors calling these villages home.

Retirement villages are popular for retirees as they offer the opportunity to downsize to a low-maintenance home in a safe and secure community of like-minded people. Residents living in a retirement village can still enjoy living an independent lifestyle without having to worry about the maintenance of a larger home.

There are costs associated with moving into a retirement village, however independent living units, apartments and villas are often much cheaper than similar sized properties in the same area. A number of retirement villages in Australia also offer the option to rent their units.

Types of Retirement Village Properties

Villas & Independent Living Units (ILUs)

Villas in a retirement village are designed for those who require little or no assistance with daily tasks, but still want to enjoy the benefits and community that come with living in a retirement village. Villas/ILUs can have anywhere from one to even four bedrooms and be stand-alone buildings, townhouses or high-rise apartment-style dwellings.

Serviced Apartments

Serviced apartments are ideal for those who don’t need regular care, but need support with some daily tasks from meals, cleaning services, laundry or personal care. Serviced apartments generally have one or two bedrooms and a small kitchen/kitchenette with access to 24-hour support. 

Retirement villages and home care services

Many retirement villages now offer their residents access to a range of home care services. Home care services can assist with daily activities including personal care, domestic work and transport to and from appointments.

Home care services do incur additional costs (in addition to the costs associated with living in a retirement villages) however you may find you are eligible to receive a Government-funded Home Care Package.

Retirement villages with co-located residential aged care

In addition to providing home care services, some retirement villages also have co-located residential aged care homes located on the same site or in the same building. This means that as your care needs change, you can still remain living in the same community.

In order to move into a retirement villages’ residential aged care accommodation, you will need to undergo an aged care assessment (ACAT/ACAS) to find out if you are eligible.

Search for retirement villages near you by clicking on your state below:

• ACT

• New South Wales

• Northern Territory

• Queensland

• South Australia

• Tasmania

• Victoria

• Western Australia

Source: This article was originally published on https://www.retirementlivingonline.com.au/your-guide-to-retirement-living.
Important:
This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.

Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

We know you want your tax return done as quickly and easily as possible. It helps to get it right! Here are some tips to help you avoid making a mistake or to fix one.

First up – you need to lodge a tax return, even if your business hasn’t earnt any income this year.

To help avoid mistakes in your return:

• double-check your answers to questions

• report income from all sources, including government support payments

• only claim deductions you’re entitled to

• complete your tax return using business records.

If you realise you’ve made a mistake, forgotten something or given us incorrect information, you can amend your return through:

• your registered tax agent

• myGov if you’re a sole trader

• Standard Business Reporting (SBR)-enabled software.

You can also request an amendment through Online services for business.

The time limit to amend a return is usually two years.

You can also make a voluntary disclosure. Voluntary disclosures cover mistakes and false or misleading information and need to be made in an approved form.

Remember, we can help you with your tax, speak to us today on Phone: 07 5641 4134.

Source: ato.gov.au November 2021
Reproduced with the permission of the Australian Tax Office. This article was originally published on https://www.ato.gov.au/Newsroom/smallbusiness/Lodging-and-paying/What-to-do-if-you-make-a-mistake-on-your-return/.

Important:
This provides general information and hasn’t taken your circumstances into account.  It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person. 

Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

If you are surprised at how prices in cities and regional areas have risen even in the face of the social and economic havoc caused by COVID-19, you’re not alone. If you are thinking of buying property, you may even be a little concerned about what the current property market means for your buying decisions. 

Is timing everything, or is time in the market more important? Whether you’re a first home buyer, upgrader, or investor, let’s look at what a property cycle is and how important it may, or may not be to your buying decision. 

What is a property cycle? 

Generally, home prices follow a four-phase cycle of Stabilisation, Growth, Boom and Decline. Over the last 40 years, property prices boomed in Australia in 1981, 1987, 1994, 2003, 2010 and 2017. This is why many people work on the assumption that property cycles last roughly seven years. But remember, this is an assumption, not a fact. 

The longest phase in the property cycle is usually Stabilisation. This is when buyers and sellers have enough confidence to enter the market in relatively equal numbers, keeping prices fairly stable. 

Many factors contribute to a rising market, but a Boom tends to end as more sellers enter the market, causing an over-supply as prices tumble and the market moves into a Decline phase.  

What factors influence the property cycle? 

Low interest rates contribute to market increases, as does strong economic performance and consumer confidence. 

The supply of property on the market also plays a big part in contributing to rising (or falling) prices and rents, as does shifting demographics including the number, age and incomes of people in households and where people are living. A good example of the impact of shifting demographics is the recent spike in regional home prices as younger people leave cities for the regions. 

How many property cycles are there at any time? 

Although we talk about the property ‘market’ there are as many property markets as there are suburbs around Australia. While we have seen unusual consistency in increases across the board in Australia recently, different states, cities and suburbs can be at varying stages of their property cycles.

Aligning your property goal to the current cycle 

The recent price surge could be what’s known as a mid-cycle ‘second wind’ caused by buyers cashed up with government incentives and lockdown savings, taking the property plunge or making a lifestyle change. It could also be viewed as a correction, as people who put off buying at the start of the pandemic, enter the market. Or, as it is in most cases, it can be a combination of factors.  

Either way, the fear of missing out, is a contributing factor to the growth phases of property cycles and it’s what makes many people anxious about when they should enter the market. That’s why it’s important to take a step back and remind ourselves that over the long-term, property prices have historically risen. 

What this means, is your property goals will dictate how much attention you should pay to where the market is currently in the cycle. Are you looking for your forever home, a long-term investment or a do-er upper you can quickly sell for a profit? Your answer will tell you how important your entry point in the cycle is. For many, it’s not what should be driving your buying decision. 

Keep in mind that market forecasting is difficult. Rather than trying to time the market for short-term gain, many buyers prefer to look further into the future and aim for longer-term property growth.

The important thing is to buy according to your goals and means. Ensure you are comfortable with your purchase including the area you are buying into and the amount you are borrowing. 

We’re always happy to discuss your property plans and current market movements with you. So please get in touch on Phone: 07 5641 4134.   

When you’re comparing things like insurance, credit cards and home loans, comparison websites can be helpful. But they have limitations and may not cover all your options.

What to keep in mind

They make money

Comparison websites are businesses. They make money in different ways, for example:

• from sponsored links

• by showing sponsored links before non-sponsored links

• from commissions paid by providers

What they base comparisons on

Ratings and rankings on comparison websites are not always clearly explained. Find out what they’re based on, and compare them with ratings and rankings on other comparison sites.

Which products and features they cover

Most comparison sites don’t cover everything that’s available. They usually only cover certain providers and certain products.

While price is one feature to compare, it’s not always the most important. Check if the website is comparing all the features that are important to you.

Know what to compare

Before using a comparison website, work out what you want to compare. For example, fees, interest rates or other features.

For tips on the different features to compare, see:

• Home loans

• Car loans

• Personal loans

• Credit cards

• Home insurance

• Car insurance

• Super funds

Once you know what you want to compare, check different comparison websites and providers’ websites.

Make a short list and compare the top one or two results by reading the product disclosure statement (PDS). The PDS explains all the features and fees in detail.

While comparison sites can certainly assist you in assessing your options, it is important to seek advice to ensure the solutions are a good fit for your circumstances. If you’d like to discuss your options, please contact us on Phone: 07 5641 4134.

Source:
Reproduced with the permission of ASIC’s MoneySmart Team. This article was originally published at https://moneysmart.gov.au/using-comparison-websites

Important note: This provides general information and hasn’t taken your circumstances into account.  It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.  Past performance is not a reliable guide to future returns.

Important
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

Buying your first investment property can be a bold step towards a more prosperous and secure future. But it also poses risks. The Successful Investor’s Michael Sloan outlines five strategies to help you take the right path.

My 5 essential investment property tips

1. Equity

Most people use the equity from their home to help buy their first investment property. They can then use the equity from both their home and investment property to buy their next property. This makes owning a portfolio of properties far easier over time.

For this strategy to work, it’s important to understand how equity works and where you stand.

It’s also important that you don’t over-extend yourself. It’s very risky to max out your equity – especially if it leaves you in a financially vulnerable position (i.e. with no ‘buffer’ in an emergency).

2. Depreciation

Generous tax breaks (including depreciation) ensure your tenants and tax savings pay (mostly) for your investment property.

To maximise your potential tax deductions (and savings), get a professional quantity surveyor to give you a depreciation schedule. It’s definitely not a job for your accountant.

3. Negative gearing and positive cash flow

Negative gearing means you pay money towards the property each year – as the cost of the property exceeds the income of the property.

Positive cash flow, on the other hand, means you make money from the property each year (i.e. total expenditure—taking into account all costs—is less than total income, including tax breaks).

Not knowing how much a property will cost you each week is a mistake many property investors make.

It’s also very important to understand how negative gearing works. It’s the most popular way to start investing in property, but you have to be able to ‘top up’ funds towards the property each month.

In time, each property will move into positive cash flow and you won’t have to keep adding funds.

4. Investment property research

It’s important to get the basics of property investing right. The good news is that if you do your research it’s hard to go wrong. Always buy in sought-after locations, close to public transport, with easy access to good schools and amenities. This will help you find good tenants.

Don’t make the mistake of only looking around the suburb you live in (or where you imagine you might want to live). You can buy anywhere in Australia, so don’t restrict yourself to just around the corner.

It’s also wise to diversify your portfolio. Once you buy in one location, it can be tempting to buy again in the same place. However, that approach concentrates your risk.

5. A house or an apartment?

This question alone could fill a whole article, and it’s one without a straightforward answer. Both have the potential to work well for you, but it’s important to buy whatever suits your budget, cash flow, and the type of property that’s popular in each area.

A single-fronted terrace in inner city Melbourne may be great for capital growth, but it could end up costing you $300 a week (after tax). This is the kind of thing that can get people into financial trouble – and it’s out of reach for the average investor.

Only buy what you can afford. This will help keep you safe, and hopefully ensure that you can buy more properties in the future.

Ready to purchase your home? Talk to us on Phone: 07 5641 4134 today.

Source: NAB 

Reproduced with permission of National Australia Bank (‘NAB’). This article was originally published at https://www.nab.com.au/personal/life-moments/home-property/invest-property/strategies

National Australia Bank Limited. ABN 12 004 044 937 AFSL and Australian Credit Licence 230686. The information contained in this article is intended to be of a general nature only. Any advice contained in this article has been prepared without taking into account your objectives, financial situation or needs. Before acting on any advice on this website, NAB recommends that you consider whether it is appropriate for your circumstances.

© 2021 National Australia Bank Limited (“NAB”). All rights reserved.

Important:
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

You’ve worked hard to build your retirement nest egg and now the time has come or is approaching for you to begin the “decumulation phase” — taking withdrawals in retirement to live off your accumulated assets.

This can be a very exciting time in your life where you get to live out your retirement dreams. But you may also be experiencing a wide range of emotions that could affect your spending strategy and your overall well-being.

If so, you’re not alone.

You may find yourself asking, “Did I save enough to last throughout my retirement? Can I afford that family vacation or investment property? Will I have enough to cover health and aged care costs?”.

While not everyone is in the fortunate position to retire comfortably, these real concerns can make it uncomfortable for even the most financially secure investors to enjoy spending their money.

So what’s really holding back prepared retirees from enjoying the fruits of their labour?

1. Self-control

When it comes to saving, investors tend to take either a short-sighted or a farsighted approach.

Short-sighted investors generally give more weight to spending and overindulging in the present. As a result, they fail to save enough for retirement.

On the other hand, farsighted investors exercise a great deal of self-control when it comes to saving, and they tend to insufficiently indulge themselves. Their discipline generally leaves them more than prepared for retirement. However, unlike their myopic counterparts who may regret their indulgences later, farsighted investors tend to feel a sense of regret for exercising too much self-control and not spending more on life’s pleasures.

The Retirement Income Review found that underspending of superannuation balances is common amongst retired Australians, and is at least in part explained by investors being happy to spend investment earnings – dividends and interest – but resist drawing down the “capital” of the super account.

Transitioning to the decumulation phase can be a tricky time, even if you’re in a position where you can afford to spend more than you are.

To assist with the shift from a saving to a spending mindset, it may be helpful to first understand your concerns. Questions to ask yourself may include: “Why did you save for retirement in the first place and what do you truly value in life?” or “How will you feel in the future if you don’t live in the moment or enjoy spending what you can afford to now?”.

When the idea of spending induces anxiety, focusing on how you’ll feel later may make your decision to go on that family trip, for example, a little easier. This is especially true if building lasting family memories in your retirement is one of the reasons you saved so hard in the first place.

Consulting a trusted financial adviser can be great in times like these, as they can offer customised solutions to meet your needs.

2. Loss aversion

It’s natural to feel good about accumulating money and bad about losing it. The principles behind loss aversion explain why the negative feelings of losing money are greater than the positive feelings of gaining an equivalent amount of money.

Loss aversion also implies that it’s less upsetting to incur losses all at once than to incur them across multiple occasions. Simply put, it hurts less to lose $100 at once, than to lose $25 on 4 separate occasions. For these reasons, coupled with the personal attachment investors have toward their savings, it shouldn’t come as a surprise that some people experience feelings of constant loss when making retirement withdrawals.

Here are a couple strategies that might help reduce those feelings of loss:

• Change your mindset. Consider your monthly or annual withdrawals as paychecks to yourself instead of money you’re taking away from your savings.

• Consider taking larger distributions less frequently. Instead of taking smaller monthly withdrawals, drawdown larger amounts on a quarterly, biannual, or annual basis and set it aside in a separate spending account.

• Set a budget, monitor it, and make adjustments

3. Scarcity and opportunity costs

Spending from what seems to be a fixed pool of non-replenishing resources can elicit feelings of stress and make you worry about “opportunity costs”.

Naturally, you’d expect this to be more of a concern for investors with insufficient savings. But as mentioned above, farsighted investors with sufficient funds can be impacted too, as their natural tendency is to focus on the future and exercise too much self-control.

You can overcome some of these concerns by employing some of the strategies mentioned above. Revisit why you invested in the first place, review the impact of spending that particular sum and whether that will impact your other long-term goals.

Being focused on the long term and taking a disciplined approach to investing are part of our core investing principles. But if you’re in a good financial position, there comes a time when it’s okay to live out the retirement you planned for.

Talk to us if spending in retirement is a concern for you Phone: 07 5641 4134

Source: Vanguard October 2021

Reproduced with permission of Vanguard Investments Australia Ltd

Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263) is the product issuer. We have not taken yours and your clients’ circumstances into account when preparing this material so it may not be applicable to the particular situation you are considering. You should consider your circumstances and our Product Disclosure Statement (PDS) or Prospectus before making any investment decision. You can access our PDS or Prospectus online or by calling us. This material was prepared in good faith and we accept no liability for any errors or omissions. Past performance is not an indication of future performance.

© 2021 Vanguard Investments Australia Ltd. All rights reserved.

Important:
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.