July Newsletter
In this edition:
BT End of Financial Year Wrap
How a Recovery Takes Shape
Stake Your Claim
Fines for Ineligibility to Super Access
Guarding SMSF Wealth
HomeBuilder Grant Program Released
AMP Life Sale to Resolution Life Complete
Financial Advice Supports Mental Health
BT End of Financial Year Wrap
The 2019-2020 financial year began with strong momentum across most financial markets. However, as the year progressed, unemployment drifted higher, and coupled with benign inflationary pressures, many countries began to lower interest rates further in response.
As the financial year headed towards March, the COVID-19 coronavirus rapidly spread across the globe, with containment measures shutting down entire economies. The impact of this economic shutdown appears to have reversed much of the economic and financial progress over the last few years and the world now finds itself in unprecedented circumstances. Major economies are now focused on delivering stimulus to support stability as the world battles containment of the pandemic.
Reducing our Carbon Footprint
Here at Hell Yes! we are embarking on some new initiatives to reduce our carbon footprint.
Stationery Recycling
We are trialing digital signing rather than posting paperwork. We have tried one solution which has not met our needs and we will now be testing DocuSign. So keep an eye on your inbox if you're expecting any paperwork.
Stationery Recycling
We are collecting any brand of pen, felt tip, highlighter, marker, empty correction fluid, correction tape, mechanical pencil and eraser pen regardless of their composition for recycling. Note that we do not accept glue sticks, erasers, rulers or other cutting objects that could disturb the recycling process. This an initiative byTerraCycle.
Soft Plastics
We are also collecting soft plastics (bread bags, biscuit, pasta & other food packaging etc) - anything that meets the scrunch test! This an initiative by RedCycle.
If you would like to join us in our efforts we would be glad to accept your recyclable items at our office - check out these fact sheets on what to recycle.
How a Recovery Takes Shape
The ASX recently held a Financial Adviser Day in partnership with Kaplan Professional in June 2020. The event included a panel session with Hasan Tevfik, Investment Strategist at MST, who discussed profit recovery in Australia across various sectors following the COVID-19 crisis, noting that the sharpest Australian bear market in history has given way to one of the fastest bull markets.
Read more about his predictions for the recovery of the Australian economy.
Stake Your Claim
You may recall in our previous newsletter we included a piece on Unclaimed Money from the Office of State Revenue.
There are two of our clients we are aware of who have found some money through this avenue - one claimed $600 in outstanding entitlements whilst another had around $1,000 in dividends from old shareholdings that had gotten “lost” over the years.
If you haven’t checked yet, what are you waiting for? Jump online to https://www.revenue.nsw.gov.au/unclaimed-money and look up your name. If there is anything owing, simply tick the relevant line, click “Submit a Claim” and complete the steps to identify yourself.
Guarding SMSF Wealth
The advantages of an SMSF are, like a trust, asset protection and a slew of taxation benefits. SMSFs have grown in popularity, increasing total assets from $11 billion 25 years ago to more than $700 billion now.
Yet family wealth is vulnerable and open to attack by viruses, lawyers, agencies, regulators and government.
Look no further than the Supreme Court of Western Australia case Miller v Taylor [2018] WASC 75. Here the second spouse of the deceased contested his will under the Family Provision Act (WA) 1972, decimating the estate proceeds for the benefit of his two children. In the end it should come as no surprise the only winners were the lawyers.
Read the article, or view the full issue of Self Managed Super magazine.
HomeBuilder Grant Program Released
The Federal Government released its HomeBuilder package on 4 June 2020 as a third wave of stimulus to the economy specifically supporting the construction industry. It is a time limited grant program with no existing funding cap, and consists of two parts; for the building of new homes, and renovation of existing owner-occupied homes.
All dwelling types are eligible under the grant program such as houses, apartments, house and land packages, off the plan builds etc. The grant monies will be non-taxable income. The grant program will work in partnership with existing State and Territory stamp duty exemptions and grants for first home buyers.
The total program is estimated to cost the National Budget $680 million, but this may vary given this is a demand driven grant with no funding caps in place.
You can find further details on the Office of State Revenue website, or view the Fact Sheet.
AMP Life Sale to Resolution Life Completed
On 1 July 2020, AMP announced the completion of the sale of its life insurance business, AMP Life, to Resolution Life for $3 billion .
AMP Chief Executive Francesco De Ferrari said:
“The sale of the Life business is a foundational step in our strategic transformation to become a simpler, client-led and growth-oriented organisation. The sale is a major milestone for AMP demonstrating our ability to execute complex projects including through the difficulties of COVID-19.
“It is also a historic moment as AMP ceases to be a life insurer after 170 years. Our Life teams will move to Resolution Life and will continue to support clients who will see no changes in their policy terms or conditions. “We are pleased to partner with an experienced operator in Resolution Life and deliver an outcome that is in the best interests of our clients, policy holders and shareholders.”
Read the announcement in full here.
Financial Advice Supports Positive Mental Health
New research has reinforced the role of financial advisers in supporting not only the financial resilience but also the mental health and well-being of Australians.
Unadvised Australians experiencing wider spread financial impacts
Unadvised Australians are more likely to feel insecure when it comes to their financial situation, with more than four in 10 (41.7 per cent) predicting the worst is yet to come for their finances, compared to fewer than three in 10 (28.2 per cent) advised respondents.
Further, one in three (33.1 per cent) unadvised Australians is in a financial position that indicates they’re either experiencing or vulnerable to bill stress and financial hardship, compared to fewer than one in four (23.3 per cent) of those who are advised.
Unadvised Australians are almost twice as likely to be applying for financial support and loans (16.2 per cent versus 8.4 per cent advised).
The advised are benefiting from pre-established passive income streams
The advised are much more likely to have personal savings (57.5 per cent vs. 48.8 per cent), however the real difference lies in passive income.
Advised Australians are almost three times more likely to receive income from investments (17.2 per cent versus 6.2 per cent) and more than twice as likely to get income from rental properties (13.9 per cent compared to 5.9 per cent).
Meanwhile, the unadvised more commonly rely on financial assistance from family (19.1 per cent versus 12.6 per cent) and side hustles (8.2 per cent versus 5.4 per cent) as their financial back up.
Read more...