Adviser of the Year!

We are so excited to share with you that Aaron Steer was awarded the prestigious National Adviser of the Year award at the recent FPW Conference. 

This is a great result for not only our existing clients but for the people of Brisbane and Ipswich who have access to (we don’t want to brag…) the best-of-the-best in their own backyard!

“This is definitely an award that I share with our whole team and particularly our amazing advisory team of Ryan McCormac and Desley Zunker, who are such high-quality advisers in their own right”

“From day one, we set out to give our clients the best possible support and experience.  It is nice to be recognised for our work and our achievements but at the end of the day, sharing this news with our clients is what I’m most looking forward to” said Aaron.

 The Collective Wealth Advisers team were also finalists in two other national categories – ‘Principal Practice of the Year’ and the ‘Innovation Excellence’ Award. 

Congratulations Aaron and the whole team on a great achievement!

For more information on how we can help you, your family or your friends, contact us at Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

The importance of a Power of Attorney

What is a Power of Attorney?

A power of attorney is a formal document giving another person the authority to make personal and/or financial decisions on your behalf.  

Personal decisions relate to your care and welfare, including your health care, (for example, deciding where or with whom you live or consenting to medical treatment).

Financial decisions relate to the management of your finances (for example, paying your bills and taxes, selling or renting your home, using your income to pay for your needs or invest your money).

There are 2 types of power of attorney:

1) General power of attorney and

2) Enduring power of attorney.

General power of attorney

You would use a general power of attorney to appoint someone to make financial decisions on your behalf for a specific period or event, such as if you’re going overseas and need someone to sell your house or pay your bills. It’s used while you can still make your own decisions and ends once you no longer can (i.e. you lose capacity).

You have lost the capacity to make a decision if you cannot:

– Understand the nature and effect of the decision,

– Freely and voluntarily make the decision, and

– Communicate the decision in some way

Enduring Power of Attorney

You would use an enduring power of attorney to appoint someone to make financial and/or personal decisions on your behalf. For financial decisions, you can nominate whether you want the attorney to begin making financial decisions for you straight away or at some other date or occasion, such as once you’ve lost the capacity to make these decisions.

Your attorney’s power to make personal decisions only commences when you lose the capacity to make these decisions.

How do I get my Estate Planning in order?

It is important that you seek guidance from an estate planning solicitor to ensure your estate plan is appropriate, valid and legally binding. As the old saying goes – do it right the first time – this is very true when it comes to estate planning.  Even if you have a Will or Powers of Attorney in place but have not reviewed these for some time, it is important to make sure they are still appropriate for your circumstances and the people you have nominated to be your executor and/or attorney are still right for you.

You can contact our office or your adviser directly if you would like to review your estate planning requirements.  We will liaise with a dedicated estate planning solicitor and manage the process to ensure your needs are met.

For more information on estate planning and your requirements, contact Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

At times, not reacting is the best reaction of all

Making a recommendation to make ‘no changes’ to your portfolio can be incredibly valuable advice indeed.

Many of our ongoing service clients will be nodding their heads as they read this article…  

As advisers, we are often recommending clients to ‘Stay the course’ and ‘Don’t react to market movements’ and ‘Stick to the strategy’.  And while at times an active approach to adjust underlying assets and investments in client portfolios is important and necessary, just as important can be recommending that clients maintain portfolios with no change and resist the urge to sell or adjust investments.

Making a recommendation to make no changes to your portfolio is only made after an exhaustive approach to research and market conditions – the same approach we take when recommending multiple changes to a portfolio – and this is incredibly valuable advice indeed.

Lets have a look at the most recent example of this:

The recent market downturn caused by the COVID-19 pandemic in the early parts of 2020 was an understandably scary time for investors.  Off the back of considerable losses in their retirement and investment portfolios, many were faced with the choice to either move their portfolio to a more defensive position (sell assets and hold the cash) or trust in their strategy (and their adviser) and ‘Stay the course’.  Those who panicked and chose to sell in March 2020 have missed out on one of the all-time great market rallies with the Australian All Ordinaries index rising from 5006 at the end of March 2020 to7600 today – a gain of around 50%.

But importantly, we are not just focussing solely on gaining the greatest return possible for clients. In fact, for most clients, this is not what drives a positive, long term client / adviser relationship. 

Equally – possibly more – important is making sure that we:

> Achieve predictable results so clients can plan for their future

> Guide clients to not make ‘emotional’ decisions with their portfolios

> Ensure that tax effectiveness is front of mind when making decisions

> Educate our clients on their options and the best course of action for their unique circumstances

Not surprisingly, our clients tell us that the thing they most appreciate about their relationship with their adviser, is just having someone to be able to discuss things with – to pick up the phone, ask questions and seek some clarity and comfort around their situation.  

The art of providing advice is personal. 

Goals and objectives are personal.  Understanding you and your family is personal. We don’t take that lightly.  

To all our clients, thank you for your trust and your willingness to ‘make it personal’.  It makes it more than just a job for us!

Have a great day! 

Aaron

For more information on your portfolio and our approach, contact us at Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

New Office Locations – Toowong and Ipswich

We are pleased to announce our new locations at Toowong and Ipswich, designed specifically with our client’s needs in mind and to make meeting with your adviser even easier!

New Toowong Office

We have made life easier for our Brisbane-based clients by hosting upcoming client meetings from our new office in Toowong Tower – right next door to Toowong Village shopping centre. It’s only a couple of minutes from our previous Milton office but has a host of benefits for you:

Free Onsite Parking – up to 2 hours of free onsite parking for our clients in the Toowong Village carpark

Easy access – entry via the shopping centre carpark, front lobby or the main shopping centre – whatever is easiest for you!

Public Transport – with a train station directly downstairs and buses out the front, public transport could be a great option for you.

No stairs – elevator access straight to our office!

Make a day of it – surrounded by great cafes, shops and restaurants!

Our new Toowong address is:   Suite 201, Toowong Tower, 9 Sherwood Road, Toowong Q 4066

Click here for Google Maps!

New Ipswich Office

Located in the ‘Top End of Town’, our new Ipswich office reflects our ongoing commitment to our local clients and to the greater Ipswich region.  With a great modern design and new client facilities, it is already attracting attention.  Easy street parking and great cafes nearby are just a bonus!

Along with our new Ipswich office location, we have an amazing team in-house ready and willing to support you at any time.  We would love you to pop in say ‘Hi’ if you are in the area! 

Our new Ipswich address is:   150 Brisbane Street, Ipswich Q 4305

Click here for Google Maps!

We look forward to seeing you in our new offices shortly!  

For more information on our new locations or to discuss your situation, contact us at Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

More Contributions, More Choice!

More contributions and more choice are coming to superannuation from 1 July this year following a series of legislative changes.

Like everything superannuation-related, the changes are complex and involve lots of acronyms. We’ve broken down the main parts below:

Super contributions 

From 1 July, most people can put more of their retirement savings into superannuation.

–  The superannuation guarantee, the mandatory contribution made by your employer, is increasing from 9.5 to 10 per cent. It will continue to rise half a percentage point each year until 1 July 2025, when it will reach 12 per cent.

  –  Concessional (pre-tax) contributions are increasing $2,500, from $25,000 to $27,500 per year. Non-concessional (post-tax) contributions (NCCs) are increasing $10,000, from $100,000 to $110,000 per year. 

  –  Activating the ‘Bring-forward arrangement’ allows contributions of up to three years’ worth of NCCs in a single year. That is increasing alongside the NCC from $300,000 to $330,000.

Those with balances below $500,000 should keep in mind they can carry forward unused concessional contributions from the previous five years, but only as far back as 2018, to make additional concessional contributions.  This can be particularly useful for those on high incomes or who have a potential capital gain during the year from the sale of an asset.  Let’s face it, no one wants to pay more tax than they have to.

But there are limits and those whose balances are already near the limit should seek advice before making contributions, to avoid going over the cap and incurring higher rates of taxation.  

As always, speak with your financial adviser before implementing any action.  

To contact us, Click Here!

For more information on your retirement and superannuation investment options, book an appointment with Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

May 2021 Market Review

Collective Wealth Advisers partner with Innova Asset Management to build and manage sustainable and robust investment portfolio’s for our clients, and to monitor investment market and economic conditions.  Our Market Review reports are collated with input from Innova.

May was a positive month for all major asset classes, with domestic equities and alternatives the strongest performers at an asset class level. At the end of the month, this trend had continued and performance across the board was strong both in a relative and absolute sense, not just for the month, but across multiple time periods.

Outlook

The outlook for investment markets and economies are somewhat different, though the media often treats them as though they are synonymous with each other. Whilst it is clear we are not out of the woods regarding the pandemic, economies globally are growing strongly, helped by

unprecedented government spending. The past decade has seen Central Banks act alone to restore sustainable economic growth through stimulus measures, but now, they also have assistance from Governments in the form of deficit spending.

However, strong economic growth does not necessarily equal strong market growth, and many markets seem to have already fully priced in the current recovery we are experiencing – meaning any shock to this could cause markets to re-assess pretty quickly. Inflation remains the main concern troubling markets presently, as they digest the risk of higher wage growth and subsequent price inflation, but this is unlikely to occur unless economies remain strong. Our research partners at Innova stated last month that they thought the market might be getting a bit ahead of itself, and recent bond market rallies confirm this view may have been correct.

Asset Class Forecast

We continue to have concerns around the US market, trading at valuation ranges only ever seen before in the tech bubble. Is the business outlook so attractive that it warrants such incredible valuations? We doubt it. No market in history has ever traded at these levels and delivered positive returns in the subsequent 10 years. Government spending can’t fix a valuation problem, only real growth and productivity gains can.

Given the unprecedented stimulus from Governments and Central Banks globally, we believe Gold continues to be a likely beneficiary. The current jovial market feel means Gold has been a soft performer, but we think it will be a good hedge if something upsets markets

We have taken a deliberate position in value equities and value regions/sectors. This has paid off of late, but we will continue to balance this bias with quality equities in case markets turn

We have tilted to equity markets that have more attractive valuations – Australia, European equities, Emerging markets and Asia (including Japan). Unfortunately, our preference for robust and sustainable growth is going to be hard to come by for the next few years, with a global economic slowdown being demonstrated in the economic data, and the over-arching trade tension has reduced our conviction in this area.

For more information on market conditions and your investment options, book an appointment with Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

2021/22 Federal Budget Analysis

This year’s Federal Budget covers a range of measures including superannuation, tax and support for home buyers. We’ve summarised the key initiatives, outcomes and potential opportunities from the 2021 Budget for you.

More flexibility around super

Repeal of the work test

Currently, Australians aged 67 – 74 must satisfy a work test (or the work test exemption) to be eligible to make super contributions. The work test will no longer apply when making non-concessional super contributions or salary sacrificed contributions. People in this age group will also be able to access the non-concessional bring forward arrangement, subject to meeting the relevant eligibility criteria.

Downsizer contributions age reduced

The age at which people are eligible to make a downsizer contribution will reduce from 65 to 60. This will allow an after-tax contribution of up to $300,000 per person when they sell their family home.

Removal of the minimum income threshold for super guarantee

The Budget removes the current $450 per month minimum income threshold under which employees do not have Superannuation Guarantee (SG) paid by their employer. The Government says that around 300,000 individuals will receive additional SG payments, 63% of whom are women.

Access to lump sums under Pension Loan Scheme (PLS)

The PLS is a voluntary, reverse mortgage type loan provided by the Government. It is designed to assist older Australians to boost their retirement income by unlocking equity in their Australian property. Through the PLS, people can receive regular fortnightly payments with the payments accruing as a debt secured against their property. A new option is to receive up to two lump sums of up to 50% of the Age Pension in a 12-month period. The maximum lump sum amount will depend on whether the individual is single or a member of a couple.

Legacy retirement product conversions

Consumers will be provided with a temporary option to transition from some legacy retirement products including to more flexible retirement products. Currently, individuals are locked into certain products that restrict access to capital and flexibility of drawdowns. Products covered include market-linked and life-expectancy retirement products commenced prior to 20 September 2007 from any provider, including self-managed superannuation funds (SMSFs), and lifetime products from SMSFs. A two-year period will be provided for these retirement products and expected to commence from 1 July 2022. Individuals would need to consider social security consequences and any income tax cost.

Home ownership proposals

First Home Super Saver Scheme (FHSSS)

The FHSSS, which was introduced in the 2017/18 Budget, allows people to save money for their first home inside their super. The Government will increase the maximum amount of voluntary contributions that can be released under the FHSSS from $30,000 to $50,000.

Family Home Guarantee for single parents

The Government has introduced the Family Home Guarantee as a way of providing a pathway to home ownership to support single parents with dependants. This is regardless of whether they are a first home buyer or a previous owner-occupier. From 1 July 2021, 10,000 guarantees will be made available over four years to eligible single parents with a deposit of as little as 2%, subject to an individual’s ability to service a loan.

New Home Guarantee

The Government is providing a further 10,000 places under the New Home Guarantee in 2021/22. This is specifically for first home buyers seeking to build a new home or purchase a newly built
home with a deposit of as little as 5%.

Personal tax relief

Extension of tax offset

The Low and Middle-Income Tax Offset (LMITO), worth up to $1,080, has been extended for an additional 12 months to cover the 2021/22 financial year. LMITO will be received once individuals lodge their tax return for the 2021/22 financial year.

Business tax incentives extended

Temporary full expensing

The temporary investment tax incentive announced in last year’s Budget has been extended for a further 12 months until 30 June 2023 giving businesses additional time to utilise the incentive
and including for projects requiring longer planning times. Businesses with a turnover up to $5 billion will be able to deduct the full cost of any eligible asset they purchase for their business, including the cost of improvements to existing assets, until 30 June 2023.

Temporary loss carry-back provision

Companies will now be permitted to carry back tax losses for an extra 12 months from the 2019/20, 2020/21, 2021/22, and now 2022/23 income years to offset previously taxed profits in 2018/19 or later income years. This too applies to businesses with an aggregated turnover of less than $5 billion.

Aged care

Response to the Royal Commission into Aged Care Quality and Safety

The Government announced an additional $17.7 billion over five years for aged care. Some of the proposals include 80,000 additional Home Care Packages over the next two years, introducing a new star rating to allow Aged Care recipients and their families to compare Aged Care providers on performance, quality and safety, implementing a new funding model, increasing the Government’s Basic Daily Fee supplement by $10 per day per resident, and from early 2022, informal carers and older Australians will benefit from increased funding to improve access to respite care and support through the Government’s Carer Gateway.

For more information on how these changes affect you and your objectives, book an appointment with Collective Wealth Advisers.  We tackle today, and tomorrow, together! [/vc_column_text][/vc_column][/vc_row]

ETF’s vs Managed Funds

Collective Wealth Advisers partner with some of the world’s leading research firms to construct, monitor and adjust our client portfolios.  Investment options are seemingly endless.  Two common styles of investments we utilise are ETF’s and Managed Funds.  But what’s the difference? 

ETF’s (or Exchange Traded Funds) and managed funds serve the same general purpose. They provide exposure to particular markets or market segments. So it’s not surprising that they share more similarities than differences.

Similarities between ETFs and managed funds

Diversification

By pooling money from many investors, ETFs and managed funds have greater buying power, enabling them to buy many different securities in large quantities. This results in greater diversification than an investor can achieve by buying individual shares and bonds. ETFs, like managed funds, can also provide diversified exposure to many segments of the market.

Regulation

ETFs are subject to all the usual requirements for registered schemes under the Corporations Act 2001. 

Transparency

Compared with actively managed funds, indexed ETFs and index managed funds are extremely transparent. Investors generally know what the holdings are and in what proportion based upon the target index, particularly when a full replication strategy is used to track the index. 

Differences between ETFs and managed funds

Trading flexibility

Orders to buy or sell ETF units are executed throughout the trading day at market-determined prices that change continually. On the other hand, an order to purchase or redeem managed fund units is executed at the end-of-day price, known as net asset value. 

Costs

Both ETFs and managed funds charge a management cost that essentially covers ongoing operating costs. But because ETFs trade on exchanges, they also have unique, and generally lower costs not associated with managed funds. 

For more information on ETF’s, managed funds, and your investment options, book an appointment with Collective Wealth Advisers.  We tackle today, and tomorrow, together! 

SMSF’s … are they right for me?

For the 650,000 or so SMSF’s in Australia, 2020 threw up some serious challenges.  Just as we had put the franking credit debate to rest, along came the coronavirus and a near 40% plunge in the markets, with dividends being slashed. At the same time, cash and term deposit rates are next to nothing and income from investment properties is under stress as well. 

2021 has seen a much-welcomed return to form in the markets and SMSF trustees have breathed a small sigh of relief. 

It’s not surprising that trustees have indicated they are feeling under stress and are questioning market conditions for the remainder of 2021 and beyond. 

The recent upheaval has also seen some trustees make drastic changes to their portfolios, mainly around their asset allocation.  The 2020 Vanguard / Investment Trends SMSF Report surveyed a large number of trustees in relation to their response to the COVID pandemic and how they were positioning their portfolios moving forward.  

– The report highlights that the number of SMSF’s being established is slowing considerably.  This has been mainly due to the frustrating amount of red tape and complexity forced upon trustees by the regulators.  

– That said, trustees overwhelmingly indicated that the desire to ‘take control’ of their retirement savings was the driver behind the establishment of an SMSF.  

– Interesting too, is the fact that SMSF’s have been disengaging from proactive financial advice and as a result, we have seen non-advised trustees ‘freaking out’ at the height of the SMSF pandemic but despite these high levels of concern, only a very small percentage retreated to cash holdings alone.  

– Some trustees have taken a more aggressive approach to their investments and see the opportunity and better equity value that the market correction has provided.

Self Managed Superannuation Funds are not for everyone!  There is a high level of time, interest and knowledge that is required to manage an SMSF.  The legal responsibility for the conduct of the fund and the ability for the fund to meet the ever-changing legislative requirements rests squarely with the trustee.  Whilst there are many benefits of holding retirement savings in an SMSF structure, unless the trustee has expert knowledge regarding investment markets, market risk and the everchanging legislative landscape, they need to surround themselves with professionals who specialise in SMSF management from both a taxation / administration point of view, but also from an investment and strategy advice perspective.

To review your SMSF from a fresh perspective and gain an insight into the current landscape, contact our specialist SMSF advice team on (07) 3371 0866 to discuss your situation. 

New Financial Year Opportunities

With June 30 nearly upon us, it is important to start thinking about the new financial year ahead and making the most of the opportunities available to us over the next 12 months.  Making small changes to your plan will allow you to be in a better position in the future and take advantage of tax benefits now!

Salary Sacrifice

Directing a small portion of your before-tax income to your superannuation each week or fortnight, can provide you with substantial personal tax savings and serve to accelerate your retirement savings.  For certain employees, you may be able to salary package expenses such as loan repayments or vehicle costs through your employer.  There are a number of legislative requirements and thresholds involved in any salary sacrificing strategy and it is always best to seek advice from your financial planner before entering into any arrangement.

As of July 1, 2021, there are new contributions caps in place that may help you reach your savings objectives sooner.

Don’t forget, if you are planning on making any personal superannuation contributions to your current super fund before June 30, time is running out.

Tax Planning

Visiting your accountant or preparing your own tax returns shouldn’t be a daunting exercise!  At Collective Wealth Advisers, we can introduce you to tax and accounting professionals ready and waiting to help you achieve the best outcome for you, your family and your business.

Not sure of your next steps?  Just get in touch with us today.

Make a Savings Plan

New financial year – new objectives. Think about what you want to achieve – whether that’s a holiday, a new car, paying off your house or just creating a wealth accumulation plan. Establishing a disciplined savings plan with an appropriate investment structure is the perfect way to make your objectives a reality.

Your Plan B

Reviewing your personal insurances (life insurance, income protection, etc.) every three years is important.  As your financial and personal situation changes, so should your personal risk insurance strategies.  If you are paying for insurances funded from your industry super fund (QSuper, Australian Super, HostPlus, etc), talk to your financial planner about what you are really covered for.  You may be surprised what you can and cannot claim and what you are paying too!

Discussing these and other options available to you with your financial planner, before you implement any changes, is always the best plan of attack.  We are looking forward to working alongside you into the new financial year and welcome any queries you may have.