Click here to download this month’s InScope newsletter [PDF]

This article looks at India’s growth, its impact on the global economy and the investment opportunities this presents.

Also covered in this newsletter:

• When do you start saving for retirement?
• Trends in the Australian economy
• Australian share market outlook
• Currency update – AUD vs USD

 Click here to download this issue of the Insight Newsletter [PDF]

Property assets continue to attract investor interest due to their appealing attributes and growth possibilities. While they are often considered to be a mainstay of an investment portfolio, there are a number of things to keep in mind when adding property to the mix.

Click here to download your copy of Insight [PDF] and if you have any questions, as always, just contact Rebecca Newton Financial Planner on 08 6201 5755.

Aside from school fees, there are regular expenses such as uniforms, equipment, and excursions that can affect your budget significantly, and with tertiary education these costs might be around for more than 15 years!

A survey by Nexus found around 33% of parents say they are taking on extra work to pay for education, while 31% are returning to the workforce. A worrying 16% of parents say they are taking out loans to meet education costs, while 15% are moving house to realise capital for education costs.

The latest consumer price index figures reveal education is the fastest-rising expense facing Australian families.

Education costs jumped 5.4% over the past year. Secondary education had the biggest increase of 7.6%, due to teachers’ wage rises and other operating costs, while preschool and primary education costs rose 6.6% and tertiary education was 3.2% higher over the 12 months to the end of March this year.

Having the money available when children start school is a better option than borrowing to pay school fees. Paying interest on the borrowings can sometimes double the amount you would pay if you had saved the money.

The best option is to start early and save regularly.

You don’t need a lot to start investing for your children’s education, and by adding small amounts regularly over time the interest earned could see your initial investment become significantly larger.

For more information on how to save for your children’s education, please contact Rebecca Newton on 08 6201 5755.

General Advice Disclaimer This article has been prepared on a general advice basis only. The information has not been prepared to take into account your specific objectives, needs and financial situation. The information may not be appropriate to your individual needs and you should seek advice from your financial adviser before making any investment decisions.

How do I act on my financial advisers recommendations?

Where do I start?

It is often explained that the client should be advised of the nature of the financial planning process at the beginning of the first appointment.

Prestige Wealth Partners outlines the six steps of the financial planning process.

Step 1 – Gather your personal and financial data

• Such as your occupation, details on your income and expenditure, debt level and additional information on past experience with investments and how comfortable you are with investment risk.

Step 2 – Identify your goals and objectives

Prestige Wealth Partners then identifies your goals and objectives considering issues such as:

• The income and asset levels you are seeking;
• Placement of your investments;
• Planned expenditure – e.g. upgrading your family home, new car, holiday etc;
• Protecting your occupational income wealth through adequate death, disability and income protection cover;

Step 3 – Identify any financial issues

• We make comparisons between where you are now financially and where you want to be.
• Where a comparison indicates your objectives are unrealistic it is necessary for you to determine whether you want to modify your lifestyle to suit your goals, or modify your goals.

Step 4 – Prepare a Statement of Advice (SoA)

• We prepare a document that provides written recommendations relating to your goals, objectives and Risk Profile, such as recommended strategies and any actions necessary to correct shortfalls.

Step 5 – Implement your Statement of Advice

• Once you sign the Authority to Proceed your adviser can implement the advice on your behalf, or assist you through the process.

Step 6 – Reviewing your financial plan

• Is the advice/strategy still appropriate to meet your goals?
• To ensure it stays up-to-date and relevant to the economic climate and your changing lifestyle a minimum of an annual review is essential.

For more information

Please contact Rebecca Newton using the form below or telephone 08 6201 5755

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It’s important to be aware of any potential impact on your financial plan. While these initiatives are proposed, they may become legislated in the near future.

Click here to download this edition of InScope (PDF)

Gearing is the strategy of borrowing money to invest. Just as you take out a loan to buy a home, you can also borrow money to invest in other assets, such as shares, property or managed funds.

Gearing enables you to boost your investment earning power by increasing the amount of money you have available to invest. While investing with someone else’s money sounds like a great strategy (and it can be), there are risks involved, so it’s not suitable for everyone.

Prestige Wealth Partners makes gearing strategies easy to understand and easy to implement.

Generally, to be effective a geared investment should:

• generate a reliable long-term income flow
• generate capital growth that exceeds inflation over the medium to long term
• be highly diversified with a number of individual investments
• be considered for investment time frames of five years or more
• draw on stable and reliable cash flows to meet the pre-tax borrowing costs.

Things to consider about geared investments:

• Who is gearing appropriate for?
• What are the benefits and the risks?
• What is the difference between positive, negative and neutral gearing?
• What is home equity gearing?
• What is margin lending?
• How do I repay a geared investment loan?
• What is a Loan to Value Ratio (LVR)?
• How does gearing affect my tax?

Rebecca Newton Financial Planner has the answers!

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The recently announced Federal Budget for 2010-11, which aims to have the deficit wiped out within three years, is in part based on assumptions that the China led mining boom will continue to benefit Australia for the foreseeable future.

In this edition of InScope from Financial Wisdom, we will look at how Australia’s trade links with China are currently boosting the economy and what may be ahead on China’s horizon.

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Click here to download this edition of InScope (PDF)