The attached discusses some of the key areas of the Federal Budget that relate
to financial planning; namely superannuation, taxation and social security.
It is clear that managed funds offer greater diversification than most people can achieve through direct share investing. Whilst there are many thousands of managed funds they can essentially be broken down to two groups, “active” and “passive”.
Active managed funds attempt to outperform the benchmark index through wise stock selection whilst ‘passive’ managed funds simply try to match the benchmark index. It is for this reason that passive funds are known as index funds. Index funds will hold every security in any given index, in the same percentage that the share is represented in the index. For example if share Y represents 3% of an index, then an index fund will have 3% of their funds invested in share Y.
As a Financial Planner there is one thing I consider to be the most important starting point for anyone wishing to plan for their future. It sounds exciting, but I’m afraid it’s not. It’s actually pretty boring, and tedious; which is perhaps why so few people actually do it… budgeting.
Something most people would prefer they didn’t have to do, maybe because the results aren’t what we want them to be, or maybe because we think it will be too complicated, time consuming or just confusing. However in order to maximise your financial position it is essential. Personal finances need to be run like an efficient business; we need to know how much income and expenses are actually occurring in our lives. Budgeting will then allow us to identify which expenses, if any, can be cut back.
I am always on the look-out for ways my clients can either make money, get given money or reduce tax – preferably in a risk-free way.
Solar Power systems are moving onto the roofs of Australian households at an exponential rate. Every day you can see numerous adverts from solar panel providers in the print media and television. Australians are embracing solar power and there is good reason for this.
I thought it wise to share with you what a financial planner actually does, because in my experience most people either have misconceptions or just don’t know.
I like to think of financial planning as the process where the client and planner get together to initially discuss the clients’ current situation. The financial planner and client then explore what’s important to the client and what their future goals, aspirations and objectives are. The planner then works out a strategy to meet these objectives and prepares a ‘blueprint’ known as a Statement of Advice or Financial Plan. Normally this covers retirement planning, eg. Informing a 40 year old of the steps required for him to retire at their preferred age of 60 with a retirement income of $75,000, in today’s dollars.