Key Points from the 2016 Budget

From 1 July 2017

The maximum contributions for salary sacrifice and superannuation guarantee contribution will be $25,000

Change – currently it is $35,000 for people aged 50 and over and $30,000 for people aged below 50.

The maximum amount that can be contributed as an after-tax contribution (eg. excess proceeds from the sale of the home or an inheritance that is contributed to superannuation) is $500,000 over a lifetime. Amounts contributed since 1 July 2007 are included in this.

Change – currently there is a limit of $180,000 per year; no lifetime cap applies.

People earning over $250,000 will pay 30% tax on contributions to superannuation (salary sacrifice and superannuation guarantee).

Change – currently the superannuation contributions for income earners under $300,000 are taxed at 15%, for people earning over $300,000 it was already at 30%. 

The maximum amount that can be transferred to a ‘superannuation pension’ is $1.6m per person. The earnings of this amount in superannuation is tax-free. The income of the remaining amount is taxed at 15%.

Change – currently there is no maximum amount that can be transferred and all income in superannuation pensions are tax-free.

People aged 65-75 will no longer have to work to contribute to superannuation.

Change – Currently a work test applies that stipulates that someone has to work for 40 hours in 30 days to qualify to contribute to superannuation.

People in ‘transition to retirement’ pensions (accessing a pension from superannuation while still working) will pay tax of 15% on the income generated in their account.

Change – Currently all income in a ‘transition to retirement’ account are tax-free.

People earning less than $37,000 will have the tax they pay on concessional contributions (salary sacrifice and superannuation guarantee) refunded up to a cap of $500.

Change – currently the contributions are taxed at 15% and no refund provided.

The maximum income for a spouse to receive a spouse offset has increased to $37,000. This is a tax ‘refund’ a person received when they contribute to their spouse’s superannuation account. The offset is 18% up to a maximum of $540.

Change – currently the maximum income allowed for the spouse is $10,800.

Employees are now able to make contributions (up to the $25,000 cap) and claim a tax deduction

Change – currently only self-employed people were able to make these contributions, employees had to salary sacrifice.

Unused concessional contributions can be carried forward over 5 years, this means if someone does not contribute the maximum amount of $25,000, they can ‘catch up’ in later years. This is available for people with balances below $500,000.

Change – currently the maximum cap cannot be exceeded in each year.

For more detailed information, please review – Federal Budget 2016-17.


Disclaimer: This article has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.

Information in this article is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.

This document contains general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision.

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Wishing you a very Merry Christmas and a fabulous New Year

Merry Christmas and Happy New Year

This year we thought we would draw some inspiration from those that have come before us:

“Christmas is not a time nor a season, but a state of mind. To cherish peace and goodwill, to be plenteous in mercy, is to have the real spirit of Christmas.”
Calvin Coolidge

And we will end our post a small snippet of the talent of Maya Angelou:

“Amazing Peace: A Christmas Poem”

By Dr. Maya Angelou

Thunder rumbles in the mountain passes
And lightning rattles the eaves of our houses.
Flood waters await us in our avenues.

Snow falls upon snow, falls upon snow to avalanche
Over unprotected villages.
The sky slips low and grey and threatening.

We question ourselves.
What have we done to so affront nature?
We worry God.
Are you there? Are you there really?
Does the covenant you made with us still hold?

Into this climate of fear and apprehension, Christmas enters,
Streaming lights of joy, ringing bells of hope
And singing carols of forgiveness high up in the bright air.
The world is encouraged to come away from rancor,
Come the way of friendship.

It is the Glad Season.
Thunder ebbs to silence and lightning sleeps quietly in the corner.
Flood waters recede into memory.
Snow becomes a yielding cushion to aid us
As we make our way to higher ground.

Hope is born again in the faces of children
It rides on the shoulders of our aged as they walk into their sunsets.
Hope spreads around the earth. Brightening all things,
Even hate which crouches breeding in dark corridors.

In our joy, we think we hear a whisper.
At first it is too soft. Then only half heard.
We listen carefully as it gathers strength.
We hear a sweetness.
The word is Peace.
It is loud now. It is louder.
Louder than the explosion of bombs.

We tremble at the sound. We are thrilled by its presence.
It is what we have hungered for.
Not just the absence of war. But, true Peace.
A harmony of spirit, a comfort of courtesies.
Security for our beloveds and their beloveds.

We clap hands and welcome the Peace of Christmas.
We beckon this good season to wait a while with us.
We, Baptist and Buddhist, Methodist and Muslim, say come.
Peace.
Come and fill us and our world with your majesty.
We, the Jew and the Jainist, the Catholic and the Confucian,
Implore you, to stay a while with us.
So we may learn by your shimmering light
How to look beyond complexion and see community.

It is Christmas time, a halting of hate time.

On this platform of peace, we can create a language
To translate ourselves to ourselves and to each other.

At this Holy Instant, we celebrate the Birth of Jesus Christ
Into the great religions of the world.
We jubilate the precious advent of trust.
We shout with glorious tongues at the coming of hope.
All the earth’s tribes loosen their voices
To celebrate the promise of Peace.

We, Angels and Mortal’s, Believers and Non-Believers,
Look heavenward and speak the word aloud.
Peace. We look at our world and speak the word aloud.
Peace. We look at each other, then into ourselves
And we say without shyness or apology or hesitation.

Peace, My Brother.
Peace, My Sister.
Peace, My Soul.
Maya Angelou

Be well, be kind, keep safe.

We hope you all enjoy your festive season!

0 comments on “10 Hints to Help You Spring Clean Your Finances”

10 Hints to Help You Spring Clean Your Finances

Tools to Get Started

Spring is a great time for starting afresh. As the sun shines longer and the flowers bloom, it feels good to tidy up a bit. Here’s a 10-point plan for spring cleaning your finances.

Fine tune your insurance

Twelve months is a long time and in that period plenty can change. There could be new financial concerns such as an investment property, or new personal responsibilities such as a child, or grandkids. Whatever happens, it’s likely to alter the balance of the amount of personal insurance you require. Whether it’s life insurance, income protection insurance or preferably a balance of several types of insurance, be sure you’ve got what you need for your current situation.

Know your value

Sit down with pen and paper and figure out exactly what you’re worth. What do you owe, and what form does that debt take? What do you own, and how liquid are those assets if funds should be required? How much have you put away so far for retirement and how is that tracking according to your plan? Most importantly, how does where you’re at now compare to where you were at 12 months ago?

Reform bad habits

Throughout the year, since your last financial health check, it’s likely that a few bad habits might have developed in your spending. Go through your bank statements and do a rough calculation – it doesn’t need to be extremely accurate – of where your money goes. Those daily take-away coffees from the cafe outside work aren’t getting any cheaper, and if you cut them out you’ll save around $1000 annually. How else can you plug the leaks?

Balance your portfolio

In consultation with your financial adviser, re-visit your investment portfolio after making a fresh discussion about your current risk appetite and the constant changes in the market. Last year’s conservative stock may be this year’s risky business, so ensure your funds are where you want them to be.

How super is your super?

It’s no secret that super funds have had a challenging time of late, but that’s no reason to cover your eyes and hope for the best. Discuss your fund with your financial adviser and request that they make the fund’s mix of investments, and their pros and cons, clear to you. Your fund may already contain the perfect mix for this market, or it could be worth shifting the weight around. Also, if you have multiple funds, ask to see if it is better for them to be consolidated in order to avoid multiplying the fees.

Clean out your files

One of the greatest turn-offs when it comes to financial considerations is the mountain of paperwork that goes with every transaction and investment. Some paperwork must be kept, but much can be shredded and then recycled. Spend a few hours making your filing cabinet a less scary place and suddenly your entire financial situation will seem rosier.

Forward plan

What will you need this coming year? Cost it out in one list. Now make a second list of what you ‘want’ in this coming year (very different to what you ‘need’). You may actually need a new car, and you may also want a bathroom renovation, or a trip to Europe. Cost the lot, work out what is realistic and responsible and what is not, then speak with your financial adviser to put plans in place to make them happen.

Destroy bad debt

Unless it’s within an interest-free period, credit card debt can be a drain on your finances. Figure out where all of your ‘bad’ debt lies – the debt that is not tax-effective or working for you as an investment – then make a weekly plan to get rid of it as soon as possible.

Celebrate your victories

If things are tracking well in terms of the plans you agreed with your financial adviser, don’t be afraid to celebrate – just don’t go overboard. Reward yourself – this way you’ll be more likely to succeed again. Give your financial results a positive personal spin and it will encourage fabulous future habits.

Define your dreams

What does your dream retirement look like? What are its main ingredients? Develop a clear picture of this in your mind and, with the help of your financial adviser, ensure your financial plan contains the right elements for it to become reality.

Source: Count Financial

Disclaimer: This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.

Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.

This document contains general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision.

0 comments on “Our New Website – We’re Listening”

Our New Website – We’re Listening

We are really excited about launching our new website however we want to ensure that it is as useful to its visitors. just like yourself, as possible.  We would really appreciate it if you would take our poll and tell us how you found your first browsing experienced.  Your feedback is sincerely appreciated.

0 comments on “Protection for your financial plan”

Protection for your financial plan

A financial plan is a powerful thing, but it’s most potent when supported by a solid insurance
strategy. What are the specific purposes of the main types of personal insurance?

Protection For Your Financial PlanWhat is the point of personal insurance? Put simply, it can help to smooth out some of the unexpected turbulence that life sometimes encounters, just as motor vehicle insurance can help take the financial shock out of events that can occur on the road.

If you have a financial plan, whether it’s a short or long term one, then your financial journey along life’s road is already mapped out. Serious threats still exist though, particularly in the form of death, illness or injury.

Helping to guard against such threats are three main types of personal insurance – life insurance, total and permanent disability and income protection. But what is the difference between the three? And how can they help to support major life and retirement goals?

Life Insurance: Putting aside the obvious emotional consequences for your family, if you died tomorrow then who would be affected financially, and how? Could the mortgage be paid? How might future school fees be financed? What would happen to the lifestyle of those closest to you?

In the event of the death (and sometimes the diagnosis of a terminal illness) of the insured, a life insurance policy pays a lump sum. The size of this lump sum will depend on the amount agreed with your insurance company.

Such insurance is not necessarily only for the main breadwinner, but for anybody whose death may affect the family’s ability to earn an income. The payment of the lump sum helps to soften the blow of the loss of income, meaning survivors have a better chance of continuing in the lifestyle to which they have been accustomed, and of protecting their financial future.

Potential financial benefits:

  • pays debts
  • lump sum can be invested for future
  • pays funeral costs
  • covers living expenses for family.

Total & Permanent Disability (TPD): An injury or illness that results in your being permanently disabled is also very likely to damage your income earning capabilities. But debts and medical bills must still be paid and the future financial health of your loved ones must be managed.

TPD pays a lump sum if you are ‘totally and permanently disabled’ and unable to work. Various TPD products carry differing definitions of ‘totally and permanently disabled’, so ensure this is clarified by your financial adviser.

As with life insurance, the TPD payout amount is agreed before the policy is put in place, to ensure it will do the job of helping to pay medical bills and protect your loved ones financially.

Potential financial benefits:

  • pays debts
  • helps to cover medical costs
  • covers living expenses for family
  • funds lifestyle and property changes resulting from disability.

Income Protection: If illness or injury leaves you unable to work for a short or long period, the result on current finances and future plans can be serious. An income protection policy can be put in place to help soften the blow, usually offering up to 75% of your current income to be paid to you in place of your regular income. The replacement income is usually paid monthly, taking away some of the typical financial stresses during recovery and helping to protect future financial plans. Income protection policies cab be highly personalised, including lower premiums for longer waiting periods (replacement income does not kick in until six weeks after disablement, for instance), longer or shorter benefit periods, and either a pre-agreed payout value or a value that is assessed at the time of the illness/injury. Premiums for income protection may also be tax deductible.

Potential financial benefits:

  • provides ongoing income to cover living expenses
  • helps to cover medical costs
  • investment strategy can potentially continue uninterrupted throughout recovery period.

Speak to us for more information or if you would like to understand more.

DISCLAIMERS:

General advice warning: The advice provided is general advice only as, in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.

Insight Financial Partners Pty Ltd ABN: 73 101 279 663 is an Authorised Representative of Count. ‘Count’ and Count Wealth Accountants® are trading names of Count Financial Limited ABN 19 001 974 625 Australian Financial Services Licence Holder Number 227232 a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Professional Member of the Financial Planning Association of Australia Limited. Head Office: Commonwealth Bank Place, 11 Harbour Street, Sydney 2000 | 1300 650 432  www.count.com.au.

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