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Super

You can start to access your super when you hit the preservation age which can be achieved by a Financial Advisor setting up a Transition To Retirement (TTR) for you. It is a minimum of 4% and a maximum of 10% of your superannuation fund balance yearly. 

 

By the age of 65, you are granted access to withdraw all of your super.

You will be allowed early access to some of your super in the event of claiming Financial Hardship or for Compassionate Grounds. 

A Financial Hardship claim is completed by a Financial Advisor. For you to qualify for Financial Hardship, you must have been on continuous Centrelink payments for at least 6 months and will be asked to present a proof of overdue bills that you can’t meet. The maximum payment is $10,000 which is $8,500 after tax.

For you to qualify for Compassionate Grounds, it must be for one of the following reasons:

  • Medical treatment and medical transport for you or a dependent;
  • Palliative care for you or a dependent;
  • Making a payment on a loan or council rates so that you don’t lose your home;
  • Modifying your home or vehicle, or buying disability aids for you or a dependent because of severe disability;
  • Expenses associated with a death, funeral or burial for a dependent;
  • You must first apply to the ATO and then apply to your superannuation fund with the help of a Financial Advisor.

You can buy a residential or commercial investment property through a Self-Managed Super Fund (SMSF).

 

According to Australian Securities and Investments Commission (ASIC) guidelines, setting up a SMSF will require at least $500,000 combined across up to 4 people. 

 

A business owner can also purchase their own business premises and will have the option to lease it back to the business for a tax deduction.

If you were unexpectedly injured while at work, you may still be able to receive money through the Income Protection cover. You will receive up to 75% of your Gross monthly income for the nominated benefit period on your policy should you be too injured and or ill and can’t work past the waiting period of your policy. Retail income protection can cover your income for 2 years or 5 years, or even up til the age of 65 or 70.

Income protection can be fully paid for by your superannuation fund.

The decision to rollover your superannuation money from one fund to the next should be taken with caution. We advise that first, you must do your research to find out the fees, benefits and insurance that each fund offers. This can often be a difficult process to do on your own and you should seek expert advice from a Financial Planner. Often, old super funds have valuable life insurance benefits attached to them which you may not even know about. However, if you roll your funds out of that super fund all the insurance benefits will be lost and you may not be able to secure replacement cover, especially if you have health issues.

Financial Planner

A Financial planner is an experienced professional that can help you achieve your financial goals in the most effective way.

 A well-informed Financial Planner can help you:

  • Save money;
  • protect against risk;
  • manage debts;
  • grow your assets;
  • reduce tax liabilities;
  • plan for retirement;
  • identify entitlements for government benefits;
  • and plan what inheritance is to be left to your dependents. 

Our responsibility is to the client, not to a product manufacturer or a bank.

When providing personal financial advice, we take into account your circumstances and goals and act in your best interest at all times. The advice may involve the recommendation of a financial product, or it may be strategic in nature.

The role of a Forward360 Financial Planner is NOT to push any particular financial products. Strategy is always the key consideration.

Most people choose to see a financial adviser when a significant event happens in their life. They may need expert advice to help them consider their options and to understand their current financial position, plus a strategy for the future. 

The need for a Financial Planner is often set in motion by events such as: 

  • Starting work or changing jobs leading to consideration of superannuation options;
  • getting married;
  • starting a family, and saving for education costs;
  • buying a house;
  • looking to start a Self-Managed Superannuation Fund (SMSF);
  • divorce;
  • looking to pay off the mortgage faster;
  • looking to invest to accumulate wealth;
  • turning 50 and planning for retirement;
  • And inheriting money, receiving redundancy payments or other lump sum payments.

Once you find a Financial Planner whom you can trust, a long-term relationship develops with regular meetings to review your changing needs and circumstances.

This is a common misconception that we encounter. At Forward360, we look at your situation and provide you with a strategy that is best for you. We believe that the actual amount of assets does not matter because the situation of each individual is unique and equally important.

A Financial Planner will work to find the most optimal financial strategy for you and your needs. This process includes understanding your current situation, identifying goals, coming up with a plan that works best for what you want out of life financially, implementing this plan in order to achieve these goals on time and reviewing it periodically so as not to miss any changes along the way.

Financial Planning

To ensure that your family and loved ones will be looked after in the event of your passing, it’s important to have the following in place:
  • Life insurance: to pay any debts along with enough money to cover the loss of your wage, which is especially important if you’re the main provider for the family. It will also cover education costs and other expenses for any dependents. The insurance and Total Permanent Disability cover can be paid by your superannuation fund. 
  • Updated list of beneficiaries: an updated list of beneficiaries on your superannuation fund will guarantee proper compensation to those you have left. 
  • Updated will and estate plan: a current will or estate plan that clearly lists out your wishes after death shall make sure that your instructions will be followed and your family will be well compensated. 

You can protect your house or any of your properties from being taken away through having the correct trust structure in place. It can help protect your assets in the event of insolvency or bankruptcy.

You can avoid passing on this burden to your beneficiaries by having a proper Estate Plan in place that can help distribute your assets to them in the most tax effective way.

Protecting yourself and your assets will help you secure your family’s financial future. You can’t afford to leave yourself or your wealth unprotected especially if you’re still in the process of accumulating wealth and paying off your mortgage. The trauma of unexpected death, accident or serious illness can be devastating for you, your family and your financial situation that is why  protecting yourself and your hard-earned assets through appropriate insurance is an integral part of the financial planning process.

 

A Financial Planner can analyse your insurance needs and recommend appropriate wealth protection solutions. The same care and expertise your Financial Planner applies to your affairs during your lifetime extends to the transfer of your assets to your family and other beneficiaries when you die. They can make sure that your wealth is transferred to the right people, at the right time, in the most tax-effective way possible.

 

Your Financial Planner can work with you, your Solicitor, or an estate planning specialist to help you structure a tax-effective estate plan using testamentary trusts and other strategies to protect your assets from unnecessary taxation or challenge.

They certainly can, but not instantly. Investing is a slow and steady but consistent way of building your wealth. With the right people to help you create the most effective strategy in making financial decisions, you will get there in no time.

Investing in different markets can increase your generated income by growing in value. Years-long investments in quality companies can certainly help you increase and sustain your wealth.

Working With Forward360

Before you meet a Forward360 Financial Planner for the first time, it’s best to be prepared so that you can get the most from the meeting. Good financial advice relies on getting a clear picture of your financial situation.

For example, you could start by listing:

  • What you own – your home, savings, superannuation accounts, cars, shares and other investments
  • What you owe – debts including mortgages, loans and outstanding credit card balances
  • An estimate of your monthly income and expenses
  • What personal insurance you have and for how much
  • Whether you have an up-to-date Will and when it was last reviewed
  • Copies of your pay slip, savings or offset account and super statements will also help the adviser get a snapshot of your finances.

It’s also helpful to do some advance thinking about your priorities and goals so you can go to the first meeting with a ‘brief’ for the adviser.

Coming up on a list of what you want to do is also helpful. Try to ask yourself questions like, do you want to: 

  • Pay off your mortgage quicker?
  • Build wealth and save for retirement?
  • Protect your family through insurance?
  • Save for your children’s education?
  • Make the most of an inheritance?

Also think about the type of advice you’d like. Are you expecting the adviser to prepare a broad financial plan or do you want advice on a particular area?

Our fees are mutually agreed directly between us and our clients and are not incentivized on product sales.  We work on a fee-for-service basis and quote the fee upfront before a client commits to advice. Our ongoing advice fees, if applicable, are cancellable at any time.

Debt reduction is often the first step in the wealth creation journey, however it needs to be considered as just one part of your broader financial position. School fees, health insurance, superannuation, holidays and having fun along the way all need to be considered so we can help you find the right balance.

It is important to assess how much risk you are prepared to take in order to achieve the higher return. The return on any investment is linked to the risk associated with the investments. As the saying goes ‘the higher the risk, the higher the return’.

The dynamic investment approach that we follow has a belief structure of what drives markets and investment outcomes. Along with this philosophy, there is also a structured decision-making framework that serves to remove the emotional (and at times frightening) elements of financial markets from rational decision making. This framework also provides the necessary flexibility to respond to the dynamic nature of markets and new unexpected situations, all the while maintaining the direction and structure that a practical and disciplined investment process provides investors.

There certainly is! We do have a referral program here at Forward360 and if you wish to know more, you can reach us through 1300 84 54 54 or visit our Refer A Friend page.

Can I use my super to invest in property?

Are you interested in investing in property but aren’t sure how to finance it? The answer may already be a part of your retirement plan.

If you have a Self-Managed Superannuation Fund (SMSF), you might have a great vehicle for purchasing both residential and commercial property using the funds in your super. Investors who own property in their SMSF can also leverage against that property, giving them a more diversified portfolio.

But don’t commit to it just yet. As with all investments, there are rules that must be followed. When choosing a property, you have to make sure it qualifies for purchase by your SMSF. The property must:

  • Meet the ‘sole purpose test’ of solely providing retirement benefits to fund members
  • Not be acquired from a related party of a member of the fund
  • Not be lived in by a fund member or any fund members’ relatives
  • Not be rented by a fund member or any fund members’ relatives

Fees

You can expect to pay fees from your SMSF when you purchase an investment property that will further reduce the balance of your fund. You should always have a clear picture of what fees are being charged and why.

Fees should NEVER be a surprise.

Risk/Reward

Borrowing from your super to buy property comes with strict borrowing conditions. Because this kind of purchase is so strict, it’s important to understand if this kind of activity is in line with your overall strategy and risk tolerance.

The rewards often outweigh the risks. For instance:

  • The ability to leverage against the property to increase your investment assets
  • Can be tax-effective as there are no earnings or capital gains tax payable in the pension phase
  • Control over the investment
  • Accurately assessing your current position (with absolutely no judgement)
  • Getting crystal clear about your financial and lifestyle goals
  • Creating a detailed, custom plan with a realistic timeline
  • Implementing each stage of the plan using every financial strategy available to minimise your tax, maximise your returns and protect your growing wealth

Don’t let this kind of opportunity slip by you simply because the information is confusing or overwhelming.

What should I expect from a financial planner?

It is expected for your advisor to ask numerous questions about your circumstances depending on your goals, both short-term and long-term, and motivations for seeking advice. You should also discuss how involved you want your advisor to be.  The Scope of Advice, an agreement between the advisor and yourself, should address your goals, objectives and needs and must be discussed with you prior to proceeding. Setting these guidelines clearly will help the advisor to determine the cost of their advice. While the initial meeting with an advisor may be free of charge, the costs after that vary depending on the complexity of the advice, frequency of advice and the types of financial products recommended.

After sufficient information is gathered through discussions and further research, the advisor will put together a written document called a Statement of Advice with detailed recommendations to help you achieve your goals. The statement of advice is not complimentary but the costs will be explained to you and provided in writing before you agree to proceed.

In the event that your advisor would recommend any products as part of their advice, they are required to provide you with the Product Disclosure Statement, which outlines the product’s features and charges. All advisors must only provide recommendations to products that are in your best interests and not theirs, a stipulation under the Best Interest Duty policy. It’s recommended that you review the product and strategy in detail and only agree to commit if you fully understand it.

Once you’ve put a financial plan in place, you are expected to review it annually and ensure that it is updated and meets your goals, which are likely to change over time.

When is the right time to seek financial advice?

So, how do you prioritise your financial plan?

Your money has a lot of demands put on it: bills, investing, lifestyle and philanthropy — it can be overwhelming and confusing. This may be why less than half of Australians have even a three to five-year financial plan.

We’re here to simplify. There are a few rules to consider when prioritising your plan.

Do you have an emergency fund? We believe you should have a MINIMUM of six months of expenses in reserve. As such, you don’t have to dip into retirement in case of an emergency and pay the incredible fees that come with an activity like that.

Debt! Pay off high-interest debt before you invest heavily. Get the advice of a trusted advisor to discuss your debt and form a plan to tackle it. There are multiple strategies for becoming debt-free while still being able to grow your wealth.Now It’s Time to Invest!The tricky part is understanding the best strategy for your portfolio. Every advisor will agree — one of the most important parts of a financial plan is diversity in your portfolio. Why? Diversity limits your exposure to any one type of asset. This reduces the volatility of your investments over time.

The perfect type of diversity for each investor is different depending on risk type, age, years to retirement and other factors. The only way to ensure you have the right plan is to have the right team of advisors on your side.

Not sure that an advisor is the right next step in your plan? Get your complimentary consultation from one of Australia’s leading financial planners. This is not a blanket or vague consultation — at Forward360, we tailor this complimentary session to you and offer real, personalised advice.

You can also check out our financial health check assessment to get a baseline understanding of where your finances stand today and where you may need some guidance.You can enjoy the wealth you’ve always imagined — you just need a solid plan!