There is more to selling your home than putting up a ‘For Sale’ sign on your front lawn. Here are the first things you should check off your list to help you get a favourable result from your investment and to ensure the process runs as smoothly as possible. 

Choose a quality agent

Asking family and friends who have purchased or sold a property about their experience is a great way to ensure the agent you’ve enlisted will provide quality service, explains an MFAA accredited finance broker. “A website and promotional material will always highlight the agent in the best possible way, but word of mouth and past client reviews will show their true colours,” she says.

Make sure the agent specialises in your area and is someone you feel comfortable around as they don’t just negotiate prices on your behalf, they also act as a mediator and represent you as a vendor.

Prepare the paperwork

Getting together all the documents required is a tedious yet necessary part of the process. Before a property can be marketed for sale, your agent requires a copy of the Contract from your legal representative, explains the broker. From a disclosure document to a home loan pre-approval, ensure all the paperwork is prepared in time to ensure it all runs smoothly.

Don’t take things personally

Remember this is a business transaction; don’t feel insulted if you receive feedback on the property that doesn’t match how you feel about your home. To ensure you come out with the best deal, remove all emotion and think of your house as a commodity. 

Your property won’t sell itself

Thinking that your home will sell itself can be a costly mistake. Despite how much you like the way you have it set up, furniture, flooring and painting changes can make a big difference to the property’s wider appeal, and marketing it widely can increase the competition and, therefore, the price.

“Engage in a thorough marketing campaign and invest in presenting your property in its best light,” advises the finance broker. “Trusting your agent’s strategy can help secure the best financial result.”

Speak to your broker

If you are making a decision to sell, speak to us on Phone: 07 5641 4134 to ensure that your plans after selling – whether they are buying a similar property, upgrading or building – are actually feasible.

“I always advise clients to speak to their broker first to make sure their plans for post-settlement are realistic,” says the finance broker. “There is nothing worse than selling your home and then not being able to achieve what you had set out to do.”

Surround yourself with a good team

When all of the people in your network, including your broker, conveyancer and agent, communicate effectively, you should be blissfully unaware of any minor issues that pop up during the course of the sale, explains the finance broker.

Source: MFAA https://www.mortgageandfinancehelp.com.au/investing/selling-your-home-first-steps/

Reproduced with the permission of the Mortgage and Finance Association of Australia (MFAA)

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.  Past performance is not a reliable guide to future returns.

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 stay with the default super fund provided by your employer there’s a chance you’ll miss out on thousands in super. 

It makes sense to take a close look at your current super fund and consider whether your money could be working harder elsewhere. If you still have many years to go until you retire, there could be a way to add thousands of dollars to your final balance.

Here are a few key areas to consider when you’re thinking about the best way to invest your super.

1. Types of investment

Most super funds invest in a mix of cash, fixed interest, property and shares. When you diversify by spreading your money across different asset classes you reduce the overall risk associated with investing your super. This means if one investment performs poorly over a period of time, other investments may perform better, minimising any potential losses.

The various elements are generally mixed in different ways to offer different levels of risk. They often have names like Conservative, Balanced and Growth and you can choose your mix to match your own risk appetite.

You also have a choice of what are known as single and multi-manager funds. A single manager fund is overseen by just one investment manager or trading advisor who may be an expert in particular asset classes. A multi-manager fund can deliver diversification by drawing on the expertise of a number of specialists.

Risk is important but, when you’re considering your mix of investment classes, there are other factors to consider such as:

• your retirement planning goals

• how much super you’d need to save for retirement to reach those goals

• your age and how many years you have to invest

• any other investments you have and the returns you can expect.

2. Performance

Small differences in the rate of return earned by your super investment can have a significant impact on your retirement savings.

Unfortunately, it’s impossible to predict performance – and there’s no guarantee that a fund which performed well in the past will continue to do so in the future. However, APRA, the superannuation industry’s regulator, has developed a Standard Risk Measure to help you compare the risk of investment options in a superannuation fund. 

3. Insurance options

Most super funds include life insurance and many add total and permanent disability insurance and/or income protection also known as salary continuance. The premiums are deducted automatically from your super balance and can be lower than those outside super.

When you’re considering a new fund you should check what cover is provided, whether it’s enough for your needs and, if not, whether there’s an option to increase the level of cover. You should also check whether you can transfer your current level of cover. This is particularly important if you have a pre-existing medical condition.

You can check and compare the details by reading the product disclosure statement on each super fund’s website.

4. Portability

With some limited exceptions, super funds give you the option of moving your money into a fund of your choice. This gives you more control over your super and also gives you the opportunity to consolidate all of your super balances into one account so you’ll pay fewer fees and charges.

However, you may want to check whether there are costs involved or if you lose some benefits with exiting a fund or switching investment options within the fund before deciding on where to invest your super. Also, if you intend to claim a tax deduction for certain personal contributions made into your existing fund, it’s important to ensure your ‘Notice of intent to claim a deduction for personal contributions’ is made and acknowledged by that Trustee before you change funds.

5. Visibility

Whichever fund you choose, it’s a good idea to keep an eye on how your investment is performing as well as any fees or costs. By law, your super fund must send you regular statements with details including:

• your balance at the start and end of the period

• details of deposits from your employer and any other contributions you may have made

• how much interest your investments have earned

• level of insurance cover

• any fees or costs.

Remember that visibility works both ways – it’s important to keep your fund up to date with your current contact details. Speak to us today on Phone: 07 5641 4134. 

Source: NAB https://www.nab.com.au/personal/life-moments/manage-money/grow-super/great-super-fund

Reproduced with permission of National Australia Bank (‘NAB’). This article was original published at https://www.nab.com.au/personal/life-moments/manage-money/grow-super/great-super-fund

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.

Australia’s inflation rate has been stubbornly below the RBA’s target band of 2–3% for several years now, but the 0.9% rate realised in 2020 was, even in this paradigm, exceptionally poor. However, economists are projecting an increase in inflation this year, driven by increased expenditure from households.

The reasoning behind these expectations is households looking to spend the savings they built up over the last year, as the household savings rate grew from 5.3% in the December 2019 Quarter to 12% in the December 2020 quarter. However, this inflationary spike is expected to be short-lived and over the next 2 to 3 years inflation is expected to remain below the RBA’s target.

Turning to the labour market, Australia’s unemployment rate sits at 5.6% in March 2021, down 0.2 points from February and continuing its downward trajectory since October 2020. The overall unemployment rate for the nation is now only 0.5 points higher than in pre-COVID February 2020.

This suggests that there is significant demand for labour that could continue to drive the downward trend in the unemployment rate. Vacancies are up for all sectors of the economy, except for Retail Trade, and Arts and Recreation Services, both of which were hit hard by COVID lockdowns. However, with the expiry of fiscal stimulus such as JobKeeper and the Coronavirus supplement for JobSeeker, it remains to be seen whether the downward trend in unemployment will continue.

The impact of the economic recovery and the uptick in inflation has been evident in the bond market. The Australian sovereign yield curve has steepened since the end of 2020, reflected in the spread between the 10-year and 2-year government bond yields, which has risen from 90 basis points at the end of December to 158 basis points at the end of April.

The Australian yield curve’s steepening has been driven by a multitude of factors. The rise in the 10-year yield has been recently buoyed by expectations of an increase in the cash rate prior to the RBA’s stated 2024 target, as measured by interest rate futures, which can be used to deduce probabilities of future rate hikes or cuts and the respective implied policy rate.

However, the rise in the 10-year yield is also partially explained by continued growth in inflation expectations, commonly referred to as ‘breakeven inflation’. The Australian 10-year breakeven rate, which is measured as the difference between the nominal yield of the Australian 10-year bond and the real yield of the Australian 10-year inflation linked bond. This measure peaked at 222 bps in early March and ended the quarter at 210.7 bps, an increase of 35 bps.

More importantly, when considering the overall changes in both the steepness and level of the curve, both have risen over the quarter due to significant moves in longer-dated government bonds. Given the RBA’s explicit 3-year government bond yield target of 10 bps, the short end of the curve has effectively been pinned to the floor in a bid at reducing short-term funding costs for institutions.

While the RBA notes the rise of the long end of the yield curve, its announcements have indicated a firm stance in relation to the official cash rate remaining at its current level until a sustained rise in inflation. The RBA has briefly acknowledged a temporary rise in inflation “due to reversals in some COVID-19 related price reductions”, however they note that “underlying inflation is expected to remain below 2 percent over the next few years”. Considering the latter, the market continues to price rosier times ahead (more than what the RBA contends).

A rise in yields is potentially a welcome sign for economic conditions ahead, but the inverse is that they also represent higher borrowing costs for market participants such as corporations and governments. For investors, the rise in yields has represented significant losses considering the magnitude of the shift across the curve, especially when considering the duration (interest rate risk) attached to longer-dated bonds. Typically, duration is one of the more difficult risks to trade for bond managers. Furthermore, as yields rise, so do their attractiveness relative to other asset classes such as equities and hybrids.

Lonsec’s base case is that we may see a modest rise in inflation over the next 12 months, but that over the medium term inflation will remain under control as broader structural deflationary pressures such as the continual impact of technology in society and the aging population continue to weigh down on most developed economies. However, even a modest rise in inflation will have consequences for financial markets, and the bond market is where the action will be.

Source: Lonsec May 2021

Reproduced with the permission of Lonsesc. This article by Ron Mehmet was originally published at https://www.lonsec.com.au/2021/05/19/what-does-inflation-mean-for-the-australian-bond-market/

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.

By Tony Kaye, Senior Personal Finance Writer, Vanguard Australia

The Australian Tax Office has started full processing of 2020-21 income tax returns, and its objective was to start paying refunds from mid-July.

As an investor it’s important to understand what information you need to record in your next income tax return, particularly in relation to income and deductions including capital gains and losses.

Here’s a check list of what you will need to include in your 2020-21 income tax return.

Investment income

Investment income to declare in your income tax return includes any amounts you’ve received or in the case of managed funds and exchange traded funds any amounts that have also been declared. This includes money you’ve earned from:

• Distributions from managed funds and exchange traded funds.

• Share dividends. Interest income from bonds (fixed interest securities) and savings accounts.

• Income received from other investment products.

• Rental income from properties.

Your total net investment income will be taxed at your individual marginal tax rate.

Income also includes any capital gains (profits) that you’ve made during the financial year from the sale of investments or through a distribution or declaration by a managed or exchange traded fund, after the deduction of allowable expenses.

A capital gains tax (CGT) event is only triggered when an investment (including an inherited investment) is sold. A 50 per cent CGT discount applies if you are an individual or trust and you’ve held an investment for more than 12 months.

Be mindful that the ATO has advanced data analytics capabilities to track investment income paid into bank accounts, including fund distributions, share dividends and savings interest.

The regulator also recently issued a warning, advising it will be prompting around 300,000 taxpayers to explain their obligations in relation to reporting capital gains and losses made from their cryptocurrency investments.

Investment expenses

As a general comment, only expenses incurred in gaining or producing assessable/taxable income is deductible.

The ATO allows you to claim a tax deduction for any direct expenses that you incur in making your investments, unless the income from specific investments is exempt from having to pay tax.

You can claim a deduction for interest charged on money borrowed to buy managed funds, exchange traded funds, shares and other investments that you derive assessable interest or income from.

Only interest expenses incurred for an income-producing purpose are deductible.

If you sell an investment for less than you paid to buy it, you can use the value of that capital loss to only offset against any capital gains you’ve made in the current year, or carry forward the loss to offset against only future capital gains.

You can claim

According to the ATO, you can claim a deduction for costs you incur to invest, such as:

• If you attend an investment seminar in relation to an existing investment, you may be entitled to claim a deduction for the portion of expenses that relate to investment income activities.

• Ongoing management fees or retainers.

• Amounts you pay for advice relating to changes in the mix of your investments.

• A portion of other costs you incur in managing the investments, such as:

  – Borrowing costs.

  – Some travel expenses.

  – The cost of specialist investment journals and subscriptions.

  – The cost of internet access.

  – The decline in value of your computer.

In addition, if you’ve made any direct personal superannuation contributions during the year using after-tax money, you’re allowed to claim a 15 per cent tax deduction in your income tax return.

Before you can claim a deduction for personal super contributions, you must give your super fund a Notice of intent to claim or vary a deduction for personal contributions form (NAT 71121) and receive an acknowledgement from your fund.

You can’t claim

• A deduction for costs related to purchasing exchange traded funds or shares, such as brokerage fees and stamp duty. But you can include them in the cost base (cost of ownership – which you deduct from what you receive when you dispose of the shares, managed fund or exchange traded fund) to work out your capital gain or capital loss.

• Managed fund or exchange traded fund indirect costs (the costs of managing each fund) as these are already factored into your net investment return.

• Fees you incur for drawing up an investment plan with a financial adviser, unless you were carrying on an investment business.

• Some interest expenses where you borrow money under a capital protected borrowing arrangement to buy shares, units in unit trusts and stapled securities. The interest is treated as the cost of the capital protection feature.

Preparing for your income tax return

Having all your investment records at hand for the financial year, including details of your transactions and investment distributions received, will ensure you accurately report your income and can claim all allowable deductions.

Your investment statements will also help you to calculate any capital gains or losses when you sell an investment.

The ATO requires you to keep records for five years that show the following:

• How much you paid for an investment. Contracts for the purchase of an asset and receipts.

• How much you sold an investment for. Contracts for the sale of an asset and receipts.

• Income you receive from an investment. Keep all records of income payments such as distribution and annual tax statements, rental payment receipts and dividend statements.

• Expenses paid while owning an investment. Receipts for payments made to manage, maintain or improve an investment.

Note – the above is general information available from the ATO. For tailored advice, you may wish to contact us on Phone: 07 5641 4134 before completing your next income tax return.

Source: Vanguard June 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.

Housing affordability is a huge issue. Working out whether to jump onto the property ladder or continue renting can be a confusing decision. We’ll go through some of the pros and cons of both options to help you make an informed decision.

Renting: the pros

Frees up your savings

By choosing the renting life over home ownership, you’re not spending your savings on a deposit and all the costs associated with buying a home. You’re freeing up money to spend or invest elsewhere. Depending on where you invest the money, you may get a greater return on investment than if you’d bought a house. You need to think carefully about your investment goals and strategy.

Or you may be at a time in your life when you’re not yet ready to have all your savings and monthly income going towards a deposit and a mortgage. Does travel or study beckon?

It gives you more flexibility

Renting gives you flexibility. As a tenant you can freely relocate from home to home and area to area once your lease expires. The significant costs associated with buying and selling means that you have less flexibility when choosing to move house.

Allows you to diversify your investments

Buying a home, especially for first home buyers, often means that all your savings will be going towards the one asset. Do you feel comfortable with most, if not all, of your savings tied up in a single investment? Renting allows you to use your savings across a broad range of investments. By diversifying your investments, you’re also spreading out any potential risk.

Renting: the cons

Renting maybe more expensive

If history is a past indicator, the cost of renting will steadily increase over the years due to inflation and rise in property prices. Depending on where you live, your mortgage repayments may initially be higher than the cost of renting, but over the life of the loan, the interest charged reduces as the principal is paid off.

Many people pay off their mortgage in under 30 years. Sure they’ll still have costs for home maintenance and council rates, but they’ll be free of large monthly payments to live in their home. If you choose a life of tenancy, you’ll always have rental payments. Once you retire and your income is reduced, it may be difficult to find a large sum of money each month. You may also be less able to absorb rent increases.

No forced savings

A mortgage is like forced savings. You have to pay your mortgage every month – putting money towards an asset that is likely to increase over time. With renting, it can be tempting to spend spare cash rather than save or invest it.

Buying a house: the pros

It gives you stability and freedom

Buying a home provides you with certainty because there’s no risk that you’ll be displaced by a landlord. Tenants have very little say in how long they can occupy a rental property beyond the lease term. Living in your own home also allows you the freedom to renovate and decorate your home as you please.

Rise in house prices over time

Having an asset that may increase in value over time is appealing. While house prices have consistently risen over the long-term, they can also have periods of weak growth or even fall in value. You need to remember that home ownership is a long-term investment strategy.

You can use the equity in your home

Home equity is the proportion of your home that you own. Provided that the value of your house is increasing, as you pay off your loan, your equity will also be increasing. You may then be able to use the equity to invest funds in an investment such as shares or a managed fund.

Buying a house: the cons

You’ll be paying interest

The interest and fees you pay over the life of a loan can be significant. Be prepared for interest rates to fluctuate during the term of your loan, especially if you have a variable interest rate or if your fixed rate period expires.

There are opportunity costs

The ‘opportunity cost’ is the cost of having your money tied up in property, when it could have been used or invested elsewhere. If you choose a life of renting, you’ll have the money you would have saved for a deposit and mortgage payments to spend elsewhere. This might be for travel, study, entertainment or your own business. It could also be used for other investments that potentially could yield greater or quicker returns than a residential property.

Ownership costs are more than just a deposit and loan repayments

Buying and selling a home isn’t cheap. According to the Reserve Bank of Australia, it costs about 4% of the sale price of your home to sell, including agents fees, advertising. And about 6% of the purchase cost is spent on stamp duty, government fees, conveyancing costs, loan establishment fees. There’s also the ongoing running costs of owning a property, including council rates, repairs, depreciation, body corporate fees, water and insurance costs. It’s much more than just saving for your deposit.

Doing the sums: the best option for you

The decision to buy or rent isn’t simple. There are many different factors to consider including your financial resources, lifestyle, family needs, investment goals and appetite for risk. Doing research and talking to an expert is a good idea. 

You can check out our home loan tools and calculators to see how much you could afford to borrow and how much repayments would be. You can also use our home loan product selector to see which type of loan account might be right for you.

You may also be eligible to purchase your first home with a deposit of as little as 5% with the first home loan deposit scheme.

To assist you with your decision speak to us on Phone: 07 5641 4134 today. 

Source: NAB https://www.nab.com.au/personal/life-moments/home-property/buy-first-home/rent-buy

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

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.

Most people can choose which super fund they’d like their super contributions paid into. You can go with your employer’s fund or choose your own.

To find out if you can choose your super fund, check with your employer. Your employer will give you a ‘standard choice form’ when you start a new job. This sets out your options.

What to look for in a super fund

When you’re comparing super funds, weigh up fund performance and the fees you’ll pay against other factors such as risk, investment returns, services and insurance.

Performance

Compare your fund’s investment performance over at least five years. Consider the impact of fees and tax.

Compare like with like. For example, only compare a balanced option with another balanced option, and try to use the same time period.

Low fees

All super funds charge fees. Fees are either a dollar amount or a percentage, or both. Either way, the lower the fees, the better. Fees are usually deducted monthly and also after an action such as switching investments.

Insurance

Super funds typically have three types of insurance for members:

• life (also known as death cover)

• total and permanent disability (TPD)

• income protection

When comparing the default insurance offered by super funds, look for:

• the premium rates

• the amount of cover

• any exclusions or definitions that might affect you

Investment options

Most super funds let you choose from a range of investment options.

Options usually include:

• growth

• balanced

• conservative

• cash

• ethical

• MySuper

Some funds will let you choose the weighting of different asset types or direct investments.

Services

Super funds may offer other services which attract special fees. These can be things like financial advice or arranging to split your super following a separation.

Compare super funds

You can find out about and compare super funds by using:

• the ATO’s YourSuper comparison tool, an online list comparing MySuper products

• the product disclosure statement (PDS) for each fund

• super comparison websites offered by private companies

YourSuper Comparison tool

The YourSuper comparison tool is a simple way to compare MySuper products and help you choose a super fund that meets your needs. It is a government resource, hosted by the Australian Taxation Office (ATO). 

Comparison websites

Super comparison websites include:

• Canstar

• Chant West

• Morningstar

• RateCity

• SelectingSuper

• SuperRatings

All of these have some information for free. Some of them also offer more detailed information for a fee.

Comparison websites can be useful, but they are businesses and may make money through promoted links. They may not cover all your options. See what to keep in mind when using comparison websites.

Don’t choose a super fund based only on its rating on one of these websites.

Compare these features:

Once you have the information you need, use our super calculator to compare how different funds will work for you.

Use our superannuation calculator

Work out:

• how much super you’ll have when you retire

• how fees affect your final payout

If you don’t choose a super fund

If you don’t (or can’t) choose your own super fund, your employer will put your super into a ‘default’ super account in their fund. This is known as a MySuper account.

Case Study

Savannah chooses lower super fees

If you decide to sell your home to move into a retirement village, there are a few things to consider.

Before selling, it’s a good idea to see how the market is travelling and look at the value of properties in your local newspaper or online.

Speak to a few real estate agents that allow you to compare prices and estimations on your home.

Get organised by writing a list, a checklist will allow you to keep on top of things and make the process of moving less stressful.

To start your checklist, you may want to list the things needed to tie up loose ends at your current residence. For example if you are renting, give the landlord adequate notice that you are vacating the property.

Look at what you will be taking with you and what you might want to put into storage or give away.

Consider if you will be packing and unpacking yourself or getting a removalist? Compare reputable removalist prices and organise finance and dates with the company.

Search for retirement living options in:

• Australian Capital Territory

• New South Wales

• Northern Territory

• Queensland

• South Australia

• Tasmania

• Victoria

• Western Australia

Source: This article was originally published on https://www.retirementlivingonline.com.au/news/16/60/Tips-for-Selling-Your-Home/d,Planning.

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.

When you’re lodging your business tax return each year, it’s important to include all income you make through your business.

This includes income you earn from:

• personal services you provide

• investments

• the sharing economy, such as ride-sourcing

• assessable government grants and payments, such as JobKeeper and JobMaker Hiring Credits.

You might receive payment in the form of:

• cash and digital payments

• vouchers or coupons, such as state government stimulus vouchers.

You can claim a deduction for most of the costs of running your business.

If you’re in an industry that requires physical contact with customers, such as healthcare, retail or hospitality, you can claim deductions for expenses related to COVID-19 safety. This includes hand sanitiser, sneeze or cough guards, other personal protective equipment and cleaning supplies.

Keep in mind the three golden rules for deductions:

• The expense must have been incurred for your business.

• If the expense is for a mix of business and private use, only claim the portion used for your business.

• You must have records to substantiate the expense and show how you worked out the business portion.

We can help you with your tax, call us on Phone: 07 5641 4134. 

Source: ATO July 2021
Reproduced with the permission of the Australian Tax Office. This article was originally published on https://www.ato.gov.au/Newsroom/smallbusiness/General/Reporting-income-or-claiming-a-deduction-/.

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.

By Robin Bowerman, Head of Corporate Affairs, Vanguard Australia

Many Australians know that investing will always come with some level of risk, namely the potential to lose money. In a recent Vanguard report on Australian attitudes towards investing, 20 per cent of those surveyed cited “worry of making a bad investment” as a barrier to investing.

But, as we advocate at Vanguard, ways to mitigate this worry is to diversify across asset classes and invest for the long-term. This way, your investments have the opportunity to override short-term market volatility and deliver long-term returns.

What many may not have considered however is that there’s also risk in not investing, and that it too should be factored in when building wealth.

But first, what are some key risks associated with investing?

1. Decrease in investment value

The value of your investments can fall as well as rise. If you buy a share or a bond for $10 today, it could be worth less than $10 tomorrow or at any time in the shorter-term future. The longer you leave your investments, the more likely they are to rise in value – but there’s no guarantee, so you need to keep your goals and risk appetite in mind when you build your portfolio.

2. Income not guaranteed

Just as the prices of investments can rise and fall, so can the income that they produce. Factors affecting portfolio income include the underlying holdings, interest rates, inflation and the level of dividends that companies are paying. All of these change over time, and that means the income from your investments will change too.

3. Liquidity of the investment

When you want to buy or sell investments, you want to be able to do it quickly and easily. For many investments – especially the broad shares and bond markets that Vanguard funds typically focus on – that’s not a problem. However, some investments can be more expensive or more difficult to buy and sell.

A good example is property, which has a longer lead time takes a longer time to buy and sell in comparison to direct shares, managed funds or ETFs and usually also involves higher transaction costs. Investments like this are said to be less liquid. They often seem to deliver a higher return to compensate for this liquidity risk, but it’s important to know that the higher return can come at a price.

So, there are real risks to investing – that’s one of the reasons why investing offers higher long-term returns than keeping your money in the bank. However, there are also risks involved with not investing:

1. Deterioration of spending power

The cost of living rises over time. Inflation – the rate at which prices rise – may be low today, but it’s been eye-wateringly high in the past. Your savings need to outpace inflation otherwise your cash will buy you less in the future.

2. Shortfall risk

If you reach the time of your goal – whether that’s retirement, a significant event, or a dream holiday – and you find that you don’t have enough money, you’ve got a shortfall. It might happen because you haven’t saved enough or the cost of your goal has changed.

A potential way to minimise shortfall risk is to carefully consider your goals and create a realistic, long-term investment plan to help you achieve them. Remember to factor in assumptions about returns and inflation; and to review your plan regularly to check that you’re on track.

3. Outliving your retirement nest egg

Longevity risk is the risk of running out of money in retirement because you’ve lived longer than expected. It might sound like a nice problem to have, but it is a realistic risk given the increase in life expectancy and nobody wants to spend their twilight years worrying about if they have enough income to live on. To minimise longevity risk, budget carefully and start investing as soon as you’re able to so you have time to let your investments grow. It’s important also to invest in a way that matches your risk tolerance and spending expectations.

Find the right balance

So, while all investing involves some risk, it’s also true that investing is one of the best ways to increase the amount of money you have available to meet your goals.

Instead of simply choosing to invest or not to invest because of associated risks, focus instead on finding the right balance for you. That is, taking on a level of risk that is appropriate for your long-term goals and time frame.

If you have any questions about your existing investments or are wanting more information about getting started, please give us a call on Phone: 07 5641 4134. 

Source: Vanguard June 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.

If you have more than one loan, it may sound like a good idea to roll them into one consolidated loan.

Debt consolidation (or refinancing) can make it easier to manage your repayments. But it may cost you more if the interest rate or fees (or both) are higher than before. You could also get deeper into debt if you get more credit, as it may tempt you to spend more.

Here are some things to consider before deciding to consolidate or refinance.

Avoid companies that make unrealistic promises

Some companies advertise that they can get you out of debt no matter how much you owe. This is unrealistic.

Don’t trust a company that:

• is not licensed

• asks you to sign blank documents

• refuses to discuss repayments

• rushes the transaction

• won’t put all loan costs and the interest rate in writing before you sign

• arranges a business loan when all you need is a basic consumer loan

Make sure you will be paying less

Compare the interest rate for the new loan — as well as the fees and other costs — against your current loans. Make sure you can afford the new repayments.

If the new loan will be more expensive than your current loans, it may not be worth it.

Remember to check for other costs, such as:

• penalties for paying off your original loans early

• application fees, legal fees, valuation fees, and stamp duty. Some lenders charge these fees if the new loan is secured against your home or other assets

Beware of switching to a loan with a longer term. The interest rate may be lower, but you could pay more in interest and fees in the long run.

Protect your home or other assets

To get a lower interest rate, you might be considering turning your unsecured assets (such as credit cards or personal loans) into a single secured debt. For a secured debt, you put up an asset (such as your home or car) as security.

This means that if you can’t pay off the new loan, the home or car that you put up as security may be at risk. The lender can sell it to get back the money you borrowed.

Consider all your other options before using your home or other assets as security.

Consider your other options first

Before you pay a company to help you consolidate or refinance your debts:

Talk to your mortgage provider

If you’re struggling to pay your mortgage, talk to your mortgage provider (lender) as soon as possible.

All lenders have programs to help you in tough times. Ask to speak to their hardship team about a hardship variation. They may be able to change your loan terms, or reduce or pause your repayments for a while.

Consider switching home loans

A different home loan could save you money in interest and fees. But make sure it really is a better deal. See switching home loans.

Talk to your credit providers

If you have credit card debt or other loans, ask your credit provider if they can change your repayments or extend your loan. The National Debt Helpline website has information about how to negotiate payment terms.

Consider a credit card balance transfer

A balance transfer may be a good way to get on top of your debts. But it can also create more problems. See credit card balance transfers to help you choose wisely.

Get free professional advice

We can help you make a plan and negotiate with your mortgage or credit providers. Call us on Phone: 07 5641 4134.

Free legal advice is available at community legal centres and Legal Aid offices across Australia. If you’re facing legal action, contact them straight away.

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/debt-consolidation-and-refinancing

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.