Clock is ticking on new super rules by lindash


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Centric Wealth Client Newsletter
Summer | 2006
                                               circle                                              Your interests – our focus.

  Message from the CEOs                             Clock is ticking on
  Greetings and welcome to your
  inaugural client newsletter.                      new super rules
  We are delighted to tell you that the
  merger has progressed extremely well.             There has been a lot of
  This did not come as a surprise to us
  as we knew that the cultural values,              coverage in the financial
  people and service offerings of the two           press about the Federal
  organisations were highly compatible.
                                                    Budget announcements
  With the merger well behind us,
                                                    to simplify and streamline
  Centric Wealth now advises on over
  $3.5 billion of assets and in excess of           super. Many have dubbed
  $6 billion of life cover, taking our total        it a $1 million window of
  revenues above $35 million.
  But while scale brings with it many
  benefits, we have not lost our boutique           The proposed changes to superannuation will
  client focus. Industry surveys show that          affect many financial plans. The proposal to
  we have one of the lowest number of               abolish Reasonable Benefit Limits (RBLs) -
  clients per financial adviser.                    which is the limit on the amount of super that
                                                    can be received as a lump sum or a pension
  Our business model is also one of
                                                    before higher taxes cut in - is a case in point.
  integration rather than aggregation
                                                    This change, along with the plan to allow tax
  - each individual business is integrated                                                             But it is the transitional arrangements
                                                    free lump sums and pensions for those over
  into a common structure with a single                                                                that apply between now and 30 June
                                                    60, levels the playing field and makes super
  culture and high levels of quality control.                                                          2007 that have been receiving the lion’s
                                                    simpler and more attractive.
  We believe an integration model is the                                                               share of attention. This is the “window of
  only way to build a sustainable premium           But while the proposals are generous in            opportunity” that you may have heard about.
  brand.                                            terms of end benefits, the contribution side       The Government has decided it will allow up
                                                    has been tightened.                                to $1 million of undeducted contributions to
  We are the only remaining high end                                                                   be made to super in this interim period.
  advisory group out of the top 20                  One of the proposals is to limit personal
  financial services companies that is not          after tax super contributions – known as           This is an advantage to those who were
  owned by a major financial institution.           undeducted contributions – to only $150,000        planning to make large contributions into
  We hope you enjoy this issue.                     a year commencing 1 July 2007. Those under         super from the sale of investment assets such
                                                    age 65 will be allowed to bring forward two        as property or business. With the 30 June
  Glen Castensen        Michael Pillemer            years of contributions allowing a one-off          deadline now in place, some may want to
                                                    contribution of $450,000 to be made.               bring forward their plans.

                                                                                                                                          cont. page 7

   INSIdE ThIS ISSuE:                                 General insurance now on offer               3    ‘Engaged philanthropy’ comes to the fore    6
   Welcome to our new offices                   2     Merger success story                         4    Staff spotlight                             7
   Banking advice worth a mint                  3     Centric group grows                          5    Centric in the news                         8
New office space hits the mark
    In finalising the merger last year, it quickly became apparent that        through either plug-in or wireless access, or take a break and catch
    Centric Wealth’s offices would need to be reconfigured. It was more        up on the day’s events on the TV. The area is well used and greatly
    than a matter of space; Centric Wealth’s business model integrates         appreciated by staff – who took full advantage of the facilities after
    individual businesses into a common structure with a single culture,       hours while the World Cup soccer was on!
    with high levels of quality control and operating standards. The
    relocation of our O’Connell Street and Market Street offices to            The new offices have impacted well on staff morale. The office
    Sydney’s Macquarie Place, and the Ascot office move to the Brisbane        design is part of a plan to retain and continue to attract the best
    CBd premises are testimony to the single location model.                   people. having the best staff means clients are provided with the
                                                                               best service. When in Sydney, drop by anytime to have a look.
    For Canberra, the transition involved a total refurbishment of the
    existing space; removing old compactors and ageing furniture and
    fittings to create new offices in modern organic colours.

    In Brisbane, extra office space was required, and the entire working
    environment was reconfigured.

    At the head office in Sydney, Centric Wealth expanded upwards,
    taking a second level of Sydney’s Macquarie Place building. An
    internal staircase (pictured) was also installed to promote staff

    A key to the office design was ensuring there were enough private
    areas for discussions, while keeping the general office environment
    open. The layout reinforces the company’s core values including
    being ‘non hierarchical’ – meaning staff of all rank, including the
    executive team, work side by side in an open plan.

    Ensuring staff were involved in the redesign, the theme for the
    meeting rooms was put to vote. Each of the 15 meeting rooms is
    named after iconic Sydney beaches. As well, each displays beach
    artwork and has aqua panes of floor to ceiling glass.

    A central feature of the new office is the ‘club’ area, adjoining the
    kitchen. Staff can take their laptops and continue working in the ‘club’

General insurance advisory
service now on offer
             Centric Wealth                      liability and professional indemnity), marine
                                                 transit, corporate travel and motor fleet
             launched a                          among others.
             general insurance
             advisory service #                  General insurance advice is also available to
                                                 all types of businesses including property
in July to provide high end                      owners, retailers, importers and exporters,
insurance advice for medium                      wholesalers, IT, medical and fashion
to large businesses and                          industries, residential and commercial strata
                                                 plans and manufacturers.
private individuals.
                                                 Appointed to head the division was Leonard
This launch was in response to client
                                                 Gordon, who has had an extensive career
demand. Many clients said they were looking
for a premium general insurance option,          in insurance broking spanning two decades,
where they could place the same level of         both internationally and within Australia.
trust that they have with Centric Wealth.                                                        art and other important assets. These are
                                                 Leonard says: “We are delighted to provide
                                                                                                 some of the many services provided to
The insurance cover provided is                  our clients with access to a range of general
                                                                                                 clients as part of the new general insurance
underwritten by a range of premium               insurance offerings which complement our        service.”
insurance companies such as Chubb,               existing wealth advisory services.
QBE, CGu, AIG, and Allianz. Insurance                                                            It is expected that a team of general
cover provided includes prestige home            “Quality property and home and contents         insurance advisers will be available at
and contents, commercial and industrial          insurance is an important insurance product     all Centric Wealth offices soon. In the
special risks, public and products liability,    for many of our clients. They also want to be   meantime, ask your adviser for more
professional risks (directors and officer’s      able to insure their home offices, works of     information.

Case study:
banking advice worth a mint
Harold Neumann was able to                       The business’ access to debt was increased      “Everything is going to specialty areas.
                                                 by 30 per cent, while his interest charges       It’s not a reflection on you, your company
access extra operating cash                      were substantially reduced.                     or your staff, and when you realise that you
for his business at financing                                                                    don’t feel stupid. A lot of businesses feel that
                                                 “The interest savings were a big
rates that were markedly                         achievement in such a tight margin
                                                                                                 because they’ve got in-house accountants,
lower than before, thanks                        environment,” harold says.                      they should be doing the negotiations with
to the expertise of Centric                                                                      the banks.
                                                 “Survival means meeting the market and
Wealth’s lending advisers.                       meeting the market means keeping costs          “Good advice equals real savings”
                                                 down. You need specialist people to help
harold’s business, a wholesaling and
                                                 you keep your costs down.                       “Once you’re inside the business, you can’t
importing company based in Sydney, depends
on being flexible and seizing opportunities                                                      see the wood for the trees - it’s the same old
                                                 “The most emotional thing is the relationship
as they arise. To become more responsive                                                         story. You don’t know what’s going on out
                                                 between clients and their banks, especially
to these opportunities, the business needed                                                      there per se, so it’s worth having somebody
                                                 long standing relationships.”
more cash. This meant access to additional                                                       who specialises in that area to assist you.”
debt facilities.                                 And that’s where Centric came in.
                                                 harold liked that Centric was able to take      So what did good advice mean to harold?
harold realised that the prevailing terms of     responsibility for the negotiations with the    “The good advice became more than good
his banking relationships were a legacy of the   bank. “It cut the emotional                     advice, it translated into actual savings. Good
historical evolution of the business and did     umbilical cord,” he says.                       advice equals real savings.”
not reflect its current requirements.

After reviewing harold’s banking                 “Survival means meeting the market and meeting the market means
arrangements, Centric Wealth’s Kieran
Canavan and Kimon Taliadoros were able to        keeping costs down. You need specialist people to help you keep your
secure a superior deal with harold’s bank.       costs down” – harold Neumann.

    Meeting your needs
    A year on from the                             corporate benefits – providing a one-stop     Your interests, our focus
                                                   shop for client centric wealth advice.
    successful merger that                                                                       Centric Wealth offers advice across both
                                                   The one thing that hasn’t changed is
    created Centric Wealth,                        that our advisers still pride themselves
                                                                                                 sides of the balance sheet.
    Inner Circle provides an                       on their personalised, boutique service
                                                                                                 Whether it is advice on developing a
                                                   to clients which they provide on a fully
    insight into the services and                  transparent basis.                            comprehensive financial plan, assistance in
    benefits Centric Wealth                                                                      managing your contingent liabilities through
                                                   The end result for individual clients is a    risk and general insurance, access to special
    now offers clients.                            scope of services that resembles a European
                                                                                                 opportunities through private capital
                                                   private bank. As the country’s leading
    While the merger extended and enhanced         privately owned wealth advisory company,      investment or even specialist lending advice,
    the service on offer to all clients, there     Centric Wealth’s advice and services extend   Centric Wealth has experts who can help.
    were many hard decisions to make along         way beyond just financial planning.
                                                                                                 The breadth and depth of the Centric
    the way. But at the heart of every decision    For business clients, the value proposition   Wealth service offering takes in:
    was the one key question: Is this in the       is unrivalled in the industry. It takes in
    clients’ best interests?                       a comprehensive range of services and           • Financial planning
                                                   specialist advisory expertise which             • Superannuation and retirement advice
    Centric Wealth now has 45 advisers             includes corporate benefits, general and        • Corporate benefits
    specialising in financial planning, risk and   risk insurance, succession planning and         • Investments
    general insurance, lending advisory and        lending advice.                                 • Special opportunities
                                                                                                   • Lending
                                                                                                   • Risk insurance
    The value proposition is simple: Centric Wealth can provide you with                           • General insurance
    the expertise you require in a complex financial world, either directly                        • Family office services
    or working in conjunction with your other professional advisers.                               • Charitable giving

Business services summary                                                    Personal services summary
Recognising that running a business is no mean feat, Centric Wealth          Centric Wealth’s personalised service to clients sets it apart from most
provides a comprehensive range of services to assist you in this task.       institutional firms. The wealth advisory service spans:

Corporate benefits                                                           Financial planning
                                                                             Many successful people neglect to focus on their own financial needs.
The Centric Wealth view of corporate superannuation is simple. That
                                                                             Centric Wealth can work with you to develop and implement a
is, there is no one best provider for each client. Rather, the aim is to
                                                                             comprehensive financial strategy.
assess your corporate super fund against a range of set criteria to
ensure it is in line with best market practice and meets your needs.         Superannuation and retirement advice
Advice on group salary continuance and group insurance cover is also         Centric Wealth provides specialist advice on the technicalities of
provided.                                                                    superannuation – including self managed super funds and dealing with
                                                                             corporate funds.
Centric’s lending advisory assists corporations in making the optimal        Investments
lending choice, whether it is for a new loan or refinancing existing         Centric Wealth has a technical research team of nine specialists
                                                                             providing insight into shares, property, managed funds, fixed interest
arrangements. Financing advice is available for a range of purposes
                                                                             and private equity investments, amongst others.
including developments, commercial cash flow and business loans and
property.                                                                    Special opportunities
                                                                             The private capital division, Centric Capital*, devises, structures and
Risk insurance                                                               delivers investments that are unique or hard to access.
Centric Wealth will work with you to establish and maintain a
comprehensive insurance protection strategy. The process is to               Lending
undertake a detailed analysis of business insurance needs to ensure          Specialist lending and refinancing advice is available for a range of
that you, your family and your business partners are protected in the        purposes including residential property and investments such as shares,
case of unforeseen events such as the death or disability (permanent         managed funds and other assets.
or temporary) of a director, partner or key person.
                                                                             Risk and general insurance advisory
                                                                             Centric Wealth can provide you with advice and guidance on the range
General insurance                                                            of insurance products available to families and individuals.
Recognising that businesses have different insurance needs, Centric
Wealth specialises in a number of classes of general insurance. These        Family office services
include commercial and industrial, public and products liability,            This service is specially designed to meet the particular needs that
marine transit, corporate travel, motor fleet, electronic equipment,         come with owning substantial family assets.
engineering, tax audit, professional indemnity and directors and
officers liability.                                                          Charitable giving
                                                                             There are a broad range of options to make charitable giving more tax
                                                                             effective. Centric Wealth can assist you with this.

Centric group grows
In September InvestAhead joined Centric Wealth in what is an                                   Mike Galgut has
outstanding outcome for both groups, and a major milestone in                                  20 years experience in the
Centric Wealth’s external growth program.                                                      investment, superannuation and
                                                                                               employee benefits markets and has built up
InvestAhead specialises in financial planning, personal risk insurance and                     a substantial corporate superannuation business.
corporate benefits and a natural fit of clients, culture and philosophy                        he plays a pivotal role in all aspects of superannuation,
exists between both parties.                                                                   group risk, claims administration and fund member
                                                                                               education. he is also the co-author of the book How
InvestAhead’s advisers and clients will gain access to the full suite
                                                                                               Much is Enough – Your Financial Roadmap to a Happy
of Centric’s client services, including lending advice, in-house share
advisory services, syndicated products, private equity offerings and
general insurance advisory.
                                                                                               don Shar has over 30 years experience in
InvestAhead’s three directors – Chandra Wirasinha, Mike Galgut and                             the financial services industry, specialising in
don Shar – collectively have over 60 years experience in the financial                         superannuation, all aspects of life insurance and
services industry.                                                                             business insurance. he runs training and education
                                                                                               seminars for his corporate clients and has spoken
                                                                                               at industry conferences both in Australia and
                  Chandra Wirasinha is a Chartered Accountant and                              abroad. he has addressed the New Zealand
                  has worked in the financial services industry for over                       Financial Planning and Insurance Association on the
                  15 years. Prior to setting up InvestAhead, Chandra                           introduction of financial services reform (FSRA) in
                  established and developed the RetireInvest franchise                         Australia and how his company had adapted to it.
                  for the Eastern Suburbs of Sydney. his previous
                  experience includes being the Managing director of a       Currently based in Bondi Junction, all three directors and staff
                  listed uK computer company and a partner in a firm         will relocate to Centric’s Macquarie Place premises in Sydney
                  of Chartered Accountants.                                  early next year.

    ‘Engaged philanthropy’                                                                          Veterans see advisory
                                                                                                    linked to giving

    comes to the fore                                                                               Bruce Christie has been voted by Asset
                                                                                                    magazine as one of Australia’s top 12
                                                                                                    advisers. he is the author of the Centric
                                                                                                    Wealth white paper: Charitable Giving
               In September,                       Bruce believes access to quality advice          – a guide to choosing the right program
                                                   about charitable giving is vital as the          to achieve your philanthropic objectives.
               financial adviser                   increasing amount of wealth in Australia         he believes that encouraging advisers
               Bruce Christie                      is creating greater opportunity for              to assist clients to achieve their wealth
               set the scene for                   philanthropy. And he says advisers are best      goals, while simultaneously contributing
                                                   placed to assist clients to understand how       to charitable causes is vital to the overall
    a new approach to wealth                                                                        accumulation of wealth in Australia.
                                                   they can achieve their philanthropic goals.
                                                   According to a recent Queensland                 Chris Cuffe recently took over the
    The Financial Planning Association’s           university survey, investors are pursuing        helm of not-for-profit organisation
    luncheon in Sydney was organised by            advice on charitable giving but there’s a real   Social Ventures Australia. Chris is a
    Centric Wealth’s financial adviser and         need for more training on the part of the        strong advocate for Prescribed Private
    charitable giving specialist Bruce Christie.   financial advisers to better equip them in       Funds, which allow substantial sums
    The event featured a panel of fellow           providing such advice.                           to be invested for future distribution
    veterans of the wealth management                                                               to charities.
    industry – Chris Cuffe, Graham Bradley         Following the overwhelming feedback
    and Peter Thornhill – who encouraged           from the event, Bruce plans to set up a          Graham Bradley, former chairman
    discussion within the industry about           focus group of financial planners to discuss     of Perpetual, created the Perpetual
    charitable giving.                             vehicles to help them hone their skills          Foundation and is actively involved in the
                                                   when discussing charitable giving options        Sydney Community Foundation, a public
    Advocating a need for quality advice           with clients.                                    philanthropic foundation. Graham seeks
    on charitable giving, the panel spoke of                                                        to challenge the mindset of financial
    engaged philanthropy, where investors take     Talk to your Centric Wealth adviser if           planners in thinking their jobs are not
    an active interest in creating wealth via      you are interested in learning more              about giving.
    initiatives ranging from private charitable    about linking charitable giving to your
    foundations to public charitable trusts.       wealth needs.                                    Peter Thornhill is now the principal of his
                                                                                                    own business, Motivated Money Pty Ltd,
                                                                                                    and consults to a number of Australia’s
    “Encouraging advisers to assist clients to achieve their wealth goals,                          leading financial institutions. he takes a
    while simultaneously contributing to charitable causes is vital to the                          keen interest in philanthropy.
    overall accumulation of wealth in Australia.” - Bruce Christie.
Clock is ticking on new super rules                                                            cont. from page 1

As the sale of some assets may take longer          Conclusions are best made
than expected it raises the issue of whether it     after in-depth analysis with a
is worth borrowing money to invest in               professional adviser rather than
super now and repay the loan once the               cursory readings of media articles.
investment is sold.
                                                    Another change is the abolition of the
The fact is that the numbers will need to           compulsory cashing rules. This means you
be crunched on a case-by-case basis and
                                                    can leave your money invested in a super
the opportunities and risks associated
                                                    fund indefinitely. This may be beneficial to
with such a strategy need to be clearly
                                                    those who are not reliant on super income to
understood and accepted.
                                                    live. People will, however, need to assess the
This question really stands under the               relative tax rate on each investment option.
broader umbrella of super versus non-super
investment. Should you invest your money            Another important change relates to the
in super (for example by salary sacrifice or        way death benefits are paid to dependants.
with borrowed money), pay your mortgage             All lump sum death benefits from a super              how super death
or invest in shares (maybe with a gearing           fund will now be tax free when paid to a              benefits will actually work
strategy), invest in property or reinvest into      dependant. dependants also have the option            is being keenly watched.
your business?                                      of receiving a death benefit as a pension. It’s       There are many questions yet to be
                                                    worth noting that death benefit pensions will         answered. draft legislation should be
These are traditional questions as to                                                                     available between december 2006 and
where you should direct excess funds,               be taxed differently depending on the ages
                                                                                                          March 2007. We have an Aspect available
and they remain as pertinent and                    of the deceased and their beneficiaries. Your         which provides a summary of the proposals
problematic now as they did before the              adviser can explain this difference, as well as       (at, or contact
super changes were announced.                       the strategy implications.                            your adviser for a copy.

Staff spotlight – Anne-Marie Esler
                    Whether it is helping           encompassed a wider scope of financial
                    advisers with their technical   advice and services to clients.
                    queries, writing client
                    communications, training        What is your professional background?
                    staff or contributing to        Before Centric I was responsible for training
                    industry think tanks,           with the Association of Superannuation
Technical Research Manager Anne-Marie               Funds of Australia (ASFA), and was
Esler is an integral member of the Centric          previously Learning and development
                                                                                                            Anne-Marie Esler… in her
Wealth team.                                        Manager at Zurich Financial Services.                   own words
Everyone is familiar with their adviser, but        I am a member of various committees                     Age: Just over 30!!
few are as familiar with the technical and          where I am able to have input into changes
support staff that work for Centric Wealth.         affecting the financial services industry and           Favourite food: Most people at work
It is these members of staff who provide            also to write and review financial services             would describe me as a healthy eater,
the infrastructure and support that make it         course material. I’m an Associate of                    but I wouldn’t say no to anything sweet!
possible for advisers to provide the highest        ASFA, a member of ASFA’s Self-Managed
                                                                                                            My favourite cuisines are Japanese and
level of service for clients.                       Superannuation Funds Education Committee,
                                                    and a member of the Financial Planning
Each edition of Inner Circle will take an
                                                    Association’s (FPA) Superannuation
in-depth look at a Centric Wealth staff                                                                     What is your passion: I love being
member, outlining their role and explaining                                                                 active and playing team sports. I go to
how the work each person does ultimately            describe your role at Centric                           the gym and play netball and oztag. I
contributes to the service clients receive.         My role is extremely diverse. It involves               have recently purchased a road bike and
                                                    helping advisers with technical queries,                am slowly coming to terms with Sydney
In our launch edition the spotlight is
                                                    writing client communications, keeping                  roads as a rider.
falling on Anne-Marie Esler, Technical
Research Manager.                                   up-to-date with relevant legislation,
                                                    presenting technical information to clients             If money was no option, what
Name: Anne-Marie Esler                              or other interested parties, training staff and         extravagance would you buy
Position: Technical Research Manager                liaising with a wide variety of participants in         yourself or your family? I’d probably
Office: Sydney                                      the financial services industry.
                                                                                                            buy my parents a boat, my sister a big
When did you join Centric and why?                  Apart from the variety, the thing I really enjoy        house for her big family and I’d take an
I joined Centric (as Centrestone) in June           about my role is building relationships with            extended overseas holiday.
2004. I was looking for a technical role that       the advisers and staff.

Centric Wealth in the news
Centric Wealth has been mentioned or                      Some other highlights of the year included an              and was also quoted in The Bulletin magazine;
quoted in over 80 newspaper and magazine                  article written by Anne-Marie Esler on saving              while Centric Wealth’s head of equity
articles since the beginning of the year.                 for education which was included in Alan                   research Paul Zwi has been quoted discussing
                                                          Kohler’s influential Eureka Report, while her              the T3 float in the Australian Financial Review
Examples of some of the headlines are
                                                          technical expertise also saw her being quoted              as well as IFA magazine.
included in the accompanying montage.                     on the front page of the Australian Financial
                                                          Review on the changes to superannuation;                   These are just a few examples of the media
This result is an indication of the high esteem           joint CEO Glen Castensen was quoted                        coverage received this year. To keep in touch
with which the financial and trade press hold             discussing issues facing advisers and dealer               with the latest news from Centric Wealth, visit
Centric Wealth.                                           groups in SuperFunds and Asset magazines                   our website at

Contact us
Level 2, 7 Macquarie Place
Sydney NSW 2000
PO Box R1851 Royal Exchange NSW 1225                      Services List
Ph: (02) 9250 6500
Fax: (02) 9252 2702                                       Financial planning
                                                          Superannuation and retirement advice
Canberra                                                  Corporate benefits                                         Any Comments?
Level 1, 8 Phipps Close, deakin                           Investments                                                If you have any comments about Inner Circle,
ACT 2600                                                  Special opportunities                                      please provide your feedback via email to
PO Box 3637 Manuka ACT 2603                               Lending                                          , or talk to
Ph: (02) 6281 1477                                        Risk insurance                                             your adviser.
Fax: (02) 6281 1476                                       General insurance
                                                          Family office services
Brisbane                                                  Charitable giving
Level 16, The Riverside Centre,
123 Eagle Street Brisbane QLd 4000
GPO Box 915 Brisbane QLd 4001
Ph: (07) 3230 6555
Fax: (02) 3221 2145

Important Information: This document has been issued on the basis that it is only for the information and exclusive use of the particular person to whom it is provided
by Centric Wealth Advisers Ltd ABN 88 090 684 521 (“Centric”). Centric is an Australian Financial Services Licensee no 243253. Although the information is derived
from sources considered and believed to be reliable and accurate, Centric, its employees, consultants, advisers and officers to the maximum extent permitted by the
law disclaim all liability and responsibility for any opinion expressed or for any error or omission that may have occurred in this document. Any forecasts included are
reasonably believed to be reliable based on current information but due to our inability to predict future events they cannot be guaranteed. This document is of a general
nature only and is not to be construed as providing advice. It has been prepared without taking into account any person's particular investment objectives, financial
circumstances or particular needs. Before making any investment decision you should assess for yourself or obtain professional advice on whether the information in this
document is appropriate to your investment objectives, financial circumstances and needs. # The advice is provided by arrangement with Westcourt General Insurance
Brokers Pty. Ltd. AFSL no. 238447. * Specialised Private Capital Ltd trading as Centric Capital is an Australian Financial Services Licensee no. 246744.

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