Insure to be Sure

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					                                                                     ACUMEN ADVISERS JOURNAL                             PAGE 1




                                                                     EDITION 9                                   April 2007

 IN THIS ISSUE:
      Insure to be Sure
      Beware of Land Tax Bills
      Good Advice for peace of mind – Part 1
      ‘Comfortable Retirement’ now $627,581
      Upcoming Seminars

                                                                       Other reasons include:
           Insure to be Sure
    with Acumen Advisers’ Brad Turns                                   ♦ the costs involved;
                                                                       ♦ the lack of understanding around the
                                                                         important role that insurance plays in a
                                                                         wealth accumulation plan; and
                                                                       ♦ most people have never really sat down and
                                                                         thought about what the implications of not
                                                                         having any cover really are.

 One of the hottest personal finance topics in                         At Acumen Advisers we certainly can’t help you
 Australia at the moment is the issue of under-                        plan to beat the statistics, but we can help you
 insurance.                                                            plan so that you are prepared in the unfortunate
                                                                       event that you do become a statistic.
 Under-insurance can be loosely defined as the
 difference between the insurance cover that you                       There is no doubt that implementing insurance
 have (if any), and the cover you and/or your                          will come at a cost. However, through careful
 dependants need to maintain a reasonable                              planning we can help to tailor a package of
 standard of living in the event of a claim.                           covers that meets your needs without breaking
                                                                       the bank. Did you know that in most cases
 According to the results of two research projects                     income protection premiums are tax deductible,
 carried by the Investment and Financial Services                      and life, TPD and in some cases income
 Association’s Protection Gap Working Group the                        protection     can      be       funded      through
 current estimate of the life underinsurance gap                       superannuation. This not only eases the burden
 for parents with dependant children is in the order                   on your cash flow, but it is tax effective as well.
 of $1.37 billion. In addition, they estimate that the
 income protection underinsurance gap is $265                          To help you get a greater understanding of how
 billion. Clearly, this is no small matter.                            personal insurance can work for you, we have
                                                                       added a new seminar, ‘Insurance – More than
 One of the major reasons that under-insurance                         just a product’ to our regular series of seminars.
 exists is the attitude of “it will never happen to                    This seminar presents insurance as a concept
 me”. In Edition 7 of our Journal we highlighted a                     and a foundation for future wealth creation. It is
 number of statistics that countered this argument.                    an opportunity to understand how insurance
                                                                       forms a vital part of your overall financial
                                                                       strategy. Cont Over…

Acumen Advisers Pty. Ltd. ACN 010 535 850, Greg Lucas and Brad Turns are Authorised Representatives of Apogee Financial
Planning Ltd, ACN 056 426 932, an Australian Financial Services licensee with its registered address at 105-153 Miller Street North
Sydney NSW 2060.

Disclaimer:
This advice may not be suitable to you because it contains general advice that has not been tailored to your personal circumstances.
Please seek personal financial advice prior to acting on this information.
                                                         ACUMEN ADVISERS JOURNAL                        PAGE 2




Cont…                                                     higher, not a lower, land tax bill. This is also the
                                                          case if you own your family home through a trust
Finally, to help you understand the implications of       or a company, since this usually results in you
not having sufficient cover, we offer one on one          missing out on the usual land tax exemption for
no obligation consultations. During these                 your principal place of residence.
consultations we can discuss your situation, and
how it would be affected in the event of illness or       One strategy for cutting your land tax bill involves
injury, or as a result of your untimely death. We         investing in home units, since the value of these
can then assist you with implementing an                  for land tax purposes is usually very low. Even
appropriate package of insurances to address              owning multiple units rarely generates a large
your needs.                                               land tax bill. Another strategy is to target those
                                                          states which charge less land tax. However,
For more information on this topic, to register           make sure you check if there are other costs,
your interest in attending one of our seminars, or        such as high local council rates or stamp duties
to make an appointment to speak to an adviser             that might work against this strategy.
please call 02 9518 3366 or 02 4228 1000 and
ask for Michelle.
                                                          For those wanting to buy multiple properties it
                                                          makes sense, everything else being equal, to buy
                                                          them in different states, since each state is able
                                                          to levy land tax only on land actually within that
                                                          state. Remember, however, that most states
                                                          have provisions that, by law, prevent you from
                                                          claiming a principal place of residence exemption
                                                          for more than one property, irrespective of which
                                                          state it is in.

                                                          It is also important to remember to take into
                                                          account the different overall land values that exist
                                                          in the different states. While a state's land tax
                                                          rate can seem high and the tax threshold
                                                          ungenerous, when put in the context of much
                                                          lower land values, the tax payable may be quite
                                                          competitive.

                                                          Adapted from “Be aware of Land Tax Bills”, Money Magazine,
Beware of Land Tax Bills                                  March 2007 Edition.

Investors thinking of entering the residential
property market need to take care they factor in
the cost of land tax. Just how big a bill you are hit
with will depend not only on the underlying land
value of the property you buy, but which state or
territory it is located.

What's more, the more properties you own —
whether as investments or as holiday retreats —
the higher your tax bill. In particular, while most
states allow investors a threshold below which no
tax is payable, calculating whether you breach
the threshold involves adding up the total land
value of all your properties.

And forget about getting around this by owning
some of your property investments through a
private company or a trust, since the treatment of
such entities is likely, in most cases, to result in a
                                                      ACUMEN ADVISERS JOURNAL                           PAGE 3




                                                       •   You want to make sure you leave something
Good Advice for peace of                                   for your children or grandchildren.
mind                                                   Who doesn’t need help?
                                                       If you are confident that you have an effective
Part 1 – Do I need a                                   financial strategy in place, then you may not need
                                                       professional advice. For example:
Financial Planner?
                                                       •    If you want to deposit some money for a
No matter where you are now, professional                  short period in a term deposit or cash
financial advice can help                                  management account, or another investment
                                                           with a guaranteed return; or
The fact is that no matter what your personal
circumstances are now, you probably have some          •    If you just want someone to carry out a share
dream of where you’d like to be in the future. Or          transaction for you. In that case, you may
you may be in the fortunate position of having             wish to seek out the services of a qualified
some money to invest. There are many reasons               and licensed stockbroker.
why you might need professional advice:                Ultimately the decision is yours, but if in doubt, it
•   You are changing jobs or just want to review       is wise to have the benefit of financial advice.
    your options under Super Choice;
•   You want to plan now for a comfortable             Adapted from “Good Advice for peace of mind”, produced by
    retirement;                                        the Financial Planning Association of Australia Limited (FPA),
                                                       October 2005.
•   You have an inheritance, redundancy or
    other lump sum to invest;
•   You want to make sure your family is
    protected if something happens to you or
    your partner;
•   You are planning to buy an investment
    property;
•   You are single again after a long relationship,
    due to divorce, separation or the death of
    your partner;
•   You are starting your own business;
•   You are planning a major life change, such
    as marriage or retirement or moving house;
    or


                                                       Important Dates
                                                       30 June 2007 – Your last chance to take
                                                       advantage of the transitional undeducted
                                                       contribution limit of $1,000,000.
                                                       1 July 2007 – Introduction of the new
                                                       superannuation legislation as announced in last
                                                       years federal budget.
                                                       20 September 2007 – Introduction of changes to
                                                       Centrelink payments as announced in last years
                                                       Federal Budget.
                                                             ACUMEN ADVISERS JOURNAL                    PAGE 4




‘Comfortable Retirement’
now $627,581
The cost of a comfortable retirement for an
Australian couple aged 65 now stands at more
than $627,500, according to the latest Westpac
ASFA Retirement Standard benchmarks.
This amount takes into account inflation and
would enable a healthy couple to enjoy a broad
range of leisure activities and a good standard of
living.
The research also revealed that with a more
modest budget of about $339,800, a retired
couple could enjoy a lifestyle better than that
provide by the age pension, but would only be
able to afford basic activities.
The national figures, which are released annually
and updated quarterly to reflect inflation, also
showed that recent drops in petrol and
pharmaceutical prices had resulted in a slight
reduction in the amount of savings required                   Upcoming Seminars
annually in retirement.                                       Our series of free seminars continues with the
                                                              following dates and topics now available.
                                                              ♦   17 Apr – Super and Retirement Planning
                                                              ♦   1 May – Super and Retirement Planning
                                                              ♦   15 May – Super and Retirement Planning
                                                              ♦   29 May – Insurance - More than Just a
                                                                  Product
                                                              ♦   12 June - Estate Planning
                                                              ♦   26 June – Gearing for Wealth Accumulation
                                                              ♦   10 July - Super and Retirement Planning
                                                              ♦   24 July – Insurance – More than Just a
                                                                  Product
                                                              ♦   7 August - Estate Planning
                                                              ♦   21   August      -   Gearing    for    Wealth
                                                                  Accumulation
                                                              Held in our office, these informative seminars run
The most significant offsetting price increases for           for approximately 40 minutes. This includes a 20
retirees were the 6.2 per cent increase in the                minute presentation and 20 minutes of open
price of domestic travel and accommodation and                question time. Drinks and light refreshments are
the 4.1 per cent increase in the price of                     then provided giving you the opportunity to speak
vegetables.                                                   informally with one of our advisers if you wish.
                                                              Places are limited and fill up quickly. If you or
Adapted from “’Comfortable retirement’ now $627,581’, Sara    anyone you know is interested in attending these
Rich, Money Management, March 8 2007 Edition.                 seminars, please contact the office on: (02) 9518
                                                              3366 or (02) 4228 1000.

				
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