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How to modernise your kitchen on a budget.

A new kitchen doesn’t have to cost the earth. Check out these savvy ideas for an updated kitchen with an old-fashioned price tag.

If you want to modernise your kitchen but you’re concerned about the cost, don’t be dismayed. There are many ways to get a new kitchen without destroying your bank balance.

Downgrade to upgrade

Saving money doesn’t mean you have to compromise on everything in your new kitchen. Select a few fittings or features that you want to spend a little more on, then budget in other areas. For example, if you have your heart set on a granite benchtop, perhaps you could have a tiled splashback instead of a glass one. By choosing one or two standout features, you can still achieve the ‘wow factor’ you’re looking for.

Don’t move mountains

You can save on electrical and plumbing contractors by working within the design of your existing kitchen. Keep your sink, oven and gas hotplates in their current positions, to minimise structural and design costs.

Buy off the shelf

It can be expensive to get cabinets, shelves or tables custom-made. While this may be your only option when you’re working with an unusual space, it might still be possible to buy some fittings off the shelf.

Stores such as Ikea and specialist kitchen suppliers sell flat pack or modular cabinets that you can assemble yourself, which should cost less than hiring a professional installer. Also, think of creative alternatives – if your dream kitchen has an island bench, why not consider a small table or a unit on wheels instead, for a relaxed country feel.

Refresh rather than renovate

Before you gut your entire kitchen, consider whether you would be happy with just a few changes. Refreshing the cabinets with new handles and a lick of paint can change the look of a room entirely.

Other low-cost changes that can lift your kitchen include replacing the benchtop, installing new window blinds and modernising the light fittings. Laminate has also had a revival, with stylish colours and designs that may just transform your kitchen at minimal expense.

Net a bargain

The internet is a treasure trove of bargains, but it’s not just the large retail stores that offer special deals online. Many individuals and small businesses offer surplus stock or items they simply don’t need on sites like Gumtree and eBay. You’ll be amazed at what people will sell for a fraction of the original cost.

Recycle

Just because you want a new kitchen doesn’t mean you can’t salvage some of your current fittings. Perhaps your tapware has hipster retro charm, or you have hardwood boards hidden beneath your lino flooring. Look at your existing kitchen objectively before you start throwing anything out.

DIY

While you may not have the time or skill to DIY everything, you may be able to save some dollars by splitting the workload with your tradies. Paint the walls on the weekend or tile the splashback, and you’ll have the satisfaction of knowing you did it yourself.

Creating your dream kitchen without breaking your budget is certainly possible. Don’t be overwhelmed by the initial quotes, just look at where you can make little changes without compromising on your vision.

When planning your renovation, contact your mortgage broker to find out how they can help you get into your new kitchen.

 

 

Article source here.

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Child care benefit and rebate

Raising a family can be one of your toughest, but most rewarding experiences. The decision to return to work after a given period may be due to one or a culmination of many factors. For example:

  • The child reaches a certain age and you have more free time
  • The added income to the household to help reduce debt, accumulate wealth and plan for retirement.

When you do decide to return to work, you may need to consider your options for child care.

In recognition of the costs associated with child care, the Government provides eligible families with financial assistance payments, such as the Child Care Benefit and Child Care Rebate.

Please note: From July 2018, the Child Care Benefit and Child Care Rebate will be replaced with a single Child Care Subsidy. Under the new system, families with an adjusted taxable income equal to or lower than $65,710 could receive a subsidy of 85% of the actual fee charged, up to an hourly fee cap. The subsidy will taper down as a family’s adjusted taxable income increases, reducing to nil at $350,000.

Child Care Benefit

The Child Care Benefit helps with the costs for approved or registered child care. To be eligible for the Child Care Benefit, certain criteria apply. For example:

  • Your child needs be attending approved or registered child care
  • You need to ensure that your child meets the immunisation requirements
  • You must be the person responsible for paying the child care costs
  • You meet the residency requirements
  • You must meet the income test (for approved care only).

The payment options for the Child Care Benefit can be:

  • Fee reduction (approved care only). Paid directly to your chosen child care service provider to reduce the child care costs you pay throughout the year.
  • Lump payment. You pay the full child care costs throughout the year and then lodge a claim at the end of the financial year to receive a lump sum payment.

To claim the Child Care Benefit, you will need to apply online or in person through Centrelink.

Approved Care
Approved care is where a child care service provider has been given approval from the Government to pass on the Child Care Benefit to eligible families.

Examples of approved care may include long day care, family day care, in-home care and occasional care to name a few.

If you intend on using an approved child care, the Child Care Benefit can generally assist with:

  • Up to 24 hours per child per week for all eligible families, or
  • Up to 50 hours per child per week if, for example, you and your partner are working, looking for work, training or studying for at least 15 hours per week or 30 hours per fortnight. You may also be eligible if you meet an exception.

For the 2017-18 financial year, the approved care rate for a non-school aged child is $4.30 per child per hour, or $215.00 per week. Whereas, for school aged children, the applicable payment rate is 85% of the non-school aged approved care rate.

It’s important to note that you may receive a different approved care rate depending on your circumstances. For example, the rate payable will depend on your household income, number of children attending child care (and, their hours of attendance), the type of child care service and any special circumstances that may apply.

In terms of the Child Care Benefit income test for approved care, the maximum rate is payable if your family’s adjusted taxable income is less than $45,114 per annum. However, you won’t be entitled to any Child Care Benefit for approved care if your family’s adjusted taxable income is more than the following thresholds:

  • One child and a household income greater than $156,914.
  • Two children and a household income greater than $162,633.
  • Three children or more and a household income greater than $183,655 (plus $34,724 for each child after the third).

Registered Care
Registered care is where individuals are registered with Centrelink as registered care providers.

Examples of registered care may include preschools, kindergartens, outside school hours care services or child care provided by grandparents/relatives/friends/nannies to name a few.

If you intend using a registered child care, you can receive the Child Care Benefit up to 50 hours per child per week if, for example, you and your partner are working (or looking for work), training or studying in the week that child care services are provided. You may also be eligible if you meet an exception.

For the 2017-18 financial year, the registered care rate for a non-school aged child is $0.719 per child per hour, or $35.95 per child per week. Whereas, for school aged children, the applicable payment rate is 85% of the non-school aged registered care rate.

It’s important to note that you don’t need to meet an income test to qualify for the Child Care Benefit for registered child care.

Please note: Your Child Care Benefit may still be paid if you’re charged for child care when your child is absent on a day that they would have usually attended. The annual limit of approved care is 42 absences per child per financial year; however, other conditions apply for occasional care. There is no absence limit for registered care.

Child Care Rebate

The Child Care Rebate is an additional payment to the Child Care Benefit, that helps with the costs for approved child care. To be eligible for the Child Care Rebate, certain criteria needs to be met. For example:

  • You child needs to be attending approved child care
  • You claim and are eligible for the Child Care Benefit for approved child care, regardless of whether your income is over the income thresholds to receive a payment
  • You and your partner are working (or looking for work), training or studying in the week that child care services are provided (unless you meet an exception)
  • You need to ensure that your child meets the immunisation requirements
  • You must be the person responsible for paying the child care costs
  • You meet the residency requirements.

To claim the Child Care Rebate, you’ll need to first apply online or in person through Centrelink for the Child Care Benefit. During this process, you will automatically be assessed for the Child Care Rebate and payment will commence upon being deemed eligible.

The payment options for the Child Care Rebate can be:

  • Fee reduction. Paid directly to your chosen child care service provider to reduce the child care costs you pay throughout the year.
  • Paid to your nominated bank either fortnightly, quarterly or annually (if you opted for this option with your Child Care Benefit, then it will also apply to your Child Care Rebate).

For the 2017-18 financial year, the Child Care Rebate can assist with up to 50% of your out-of-pocket costs associated with child care, i.e. total child care fees less any Child Care Benefit payments and Jobs, Education and Training Child Care Fee Assistance received. This is capped at an annual limit of $7,613 per child.

It’s important to note that you don’t need to meet an income test to qualify for the Child Care Rebate.

Please note: Your Child Care Rebate may still be paid if you’re charged for child care when your child is absent on a day that they would have usually attended. The annual limit of approved care is 42 absences per child per financial year.

These Government financial assistance payments may help make the transition back to work easier for your household.

You may also find our article, ‘Parents returning to work’ useful, this runs through other things to consider when returning to work such as reviewing your personal insurances and your Will, as well as your superannuation.

Article source here.

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Financial attitudes and behaviours: The power of perspective

In our article, ‘Financial mindsets of the super wealthy’, we discuss that whilst on the path to financial freedom, occasionally it can be helpful to gain perspective along the way, by considering and then reflecting on the financial attitudes and behaviours of others.

It’s this gained perspective that can sometimes allow us to look inwards and evaluate our own financial attitudes and behaviours, and where applicable, make adjustments.

In this article, instead of focusing on the super wealthy, we look at the financial attitudes and behaviours of everyday Australians as reported in the Australian Securities and Investments Commission’s (ASIC’s) latest Australian Financial Attitudes and Behaviour Tracker (Wave 5).

 

Australian Financial Attitudes and Behaviour Tracker
The Australian Financial Attitudes and Behaviour Tracker was launched by ASIC in 2014 to track a number of financial attitudes and behaviours among adult Australians. Below are several of the findings from the five main areas focused on.

Financial attitudes – the attitudes towards managing money
Around 6 in 10 Australians feel confident about managing their money, but more Australians find managing their money stressful. Within these overall findings, younger people, including those with children, expressed higher levels of financial stress when compared to other groups that responded to the survey.

In our article, ‘Recognising and dealing with financial stress’, we discuss the fact financial stress can arise at any point in your life. In these situations, it’s important to recognise and deal with financial stress when it does present itself. Furthermore, you may find that financial stress can occur when confidence around managing your money is a little low. As such, getting your personal finances in order can often be a great first step in the right direction to gaining confidence in the management of your money and alleviating financial stress.

Keeping track of finances – approaches to managing everyday expenses
Around 8 in 10 Australians have a budget and 9 in 10 are keeping track of their finances in some way; however, despite these overall findings, checking for unusual or suspicious transactions on either bank or credit card statements was a noticeable exemption for some.

In our animation, ‘Tracking your spending’, we discuss the importance of keeping track of your day-to-day spending habits. Tracking your spending is a great way to make sure your spending is aligned with the budget you have set for yourself, so that you can continue to work towards achieving your financial goals and objectives. It’s also an important means of assessing whether unusual or suspicious transactions have occurred, and where applicable, bringing these to the attention of your relevant financial institution so that they can be appropriately addressed.

Planning ahead – planning for the short, medium and long-term, including retirement and beyond
Around 1 in 2 Australians have a short to medium term financial plan (3-5 years), whilst around 1 in 4 have a long-term financial plan (15-20 years). Furthermore, roughly 2 in 3 Australians reported monitoring their progress in the last six months.

In our article, ‘Running the retirement plan race’, we discuss that financial plans are important individualised road maps devised to help you reach your financial goals and objectives. Along the way, it’s important to assess your progress, and where applicable, make adjustments so that you continue to move in the right direction.

Think about one overall long-term financial plan (where you want to be) that has multiple short to medium-term financial plans (how you are going to get there) within it – and, the markers of progress towards realising your overall long-term financial plan can be measured by reviewing your achievement of these short to medium-term plans over time.

Staying informed – use of information, tools and guidance when needed
Financial institution websites, followed by talking to family and/or friends, continue to be some of the most common sources of information Australians consulted in the last six months when considering bank accounts, credit cards, home loans and personal loans. However, in terms of investments, seeking professional advice was the most common source of information Australians consulted.

When it comes to your personal finances, an important consideration is the power of leverage gained when a team of professionals (such as a financial adviser, accountant, solicitor and mortgage broker) are built around you and appropriately utilised. In our video, ‘Teamwork, leverage and achieving a common goal’, we discuss the importance of recognising where your limitations lie (in terms of knowledge and skillset) and the subsequent circumstances where the benefits of teamwork may be appropriate in achieving your financial goals and objectives.

Ultimately, seeking professional advice in areas of your personal finances (cashflow, debt management, insurance planning, investments, and superannuation) will enable you to receive appropriate guidance that is tailored to your financial situation, goals and objectives.

Financial control – savings behaviour and managing debt
Around 1 in 5 Australians reported that they did not save any money over the last six months. In addition, a small percentage reported that they would not be able to cover three months’ living expenses if faced with a sudden loss of income.

Given the rising cost of living (such as electricity and grocery bills), and a relatively sluggish wage growth environment, at present you may have started to feel a slight pinch in the hip pocket when it comes to the availability of surplus income to put towards a savings plan or the repayment of debt. In our article, ‘Household expenditure: Finding surplus income’, we discuss that by completing or reviewing an existing budget, you can gain a better understanding of the movement of your money (inflows and outflows) and areas where surplus income may lie. By itemising your household expenditure and then taking the time to do an assessment of your spending habits, you can see whether adjustments can be made here or there to find surplus income.

In addition, in terms of managing living expenses with a sudden loss of income, it’s important to consider the establishment of an emergency buffer and appropriate personal insurances, so that if such a situation does arise you do not need to rely on other sources, such as credit cards and borrowing.

Financial literacy – level of understanding of several key investing concepts
Less than 1 in 3 Australians report understanding the risk/return trade-off concept and only 4 in 10 understand the investing principle of diversification.

In our article, ‘Diversification fundamentals in portfolio construction’, we discuss the importance of ‘not putting all your eggs in one basket’ and how diversification can be achieved through spreading your funds across different asset classes and markets and regions. Furthermore, we also discuss how your risk tolerance, financial situation and financial goals affect how diversification is applied when it comes to devising an appropriate investment mix to meet your needs within a specified time horizon.

Ultimately, words and our understanding of them can help us to comprehend in a meaningful way the information that we receive and make informed decisions in relation to our own personal circumstances. Although, jargon is prevalent in many industries, in terms of investments, the risk/return trade-off concept and diversification principle are two important things to understand.

 

Moving forward
Our ideas, thoughts and opinions can invariably influence our financial attitudes and behaviours, which can in turn influence how we manage our personal finances. Sometimes comparing similarities and differences to our own personal circumstances, via gained perspective from others, can allow us to look inwards and see whether there are things that we need to take the time to consider, improve upon or give ourselves a pat on the back for.

Please remember that we are here to help and support you on your journey towards financial freedom. As such, if there is an area of your personal finances (cashflow, debt management, insurance planning, investments, or superannuation) that you would like to discuss then book a time to have a chat with us.

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New year, new career, new you. Employment hotspots for 2018.

Many employees returning from summer holidays may be pondering a career change in the face of sluggish average wage growth.

So what industries are predicted to be most in demand?

National recruitment company Hays predicts data security and technology, human resources, social assistance, aged care and construction will be among the job hot spots in 2018.

Tim James, Hays managing director for Victoria, Tasmania and ACT, says data security and IT jobs will boom as technology continues its rapid growth.

“Numerous industries are spending a significant amount of money and investing in improving their products and their services and efficiency,” he said.

Sectors such as finance and banking, mining and professional services are investing in new technologies, with expertise required in cyber security and innovation.

“That is definitely a big area that we are seeing skill shortages in,” Mr James said.

As companies introduce new innovations in technology, jobs for human resources professionals will increase to ensure the changes are properly integrated into organisations.

“With all change … it’s really important that it gets embedded into the organisation, so there definitely is a big emphasis on HR professionals being able to support any change,” Mr James said.

As the National Disability Insurance Scheme continues to be rolled out across Australia, jobs in the sector will grow to provide support to an estimated 475,000 people with a disability.

There is also growing demand for aged care employees as baby boomers age, including clerical jobs, personal care attendants, registered nurses and facility managers.

Psychology is another area tipped for healthy jobs growth as people become more attuned to looking after their mental health.

Mr James said large public infrastructure projects such as multi-billion dollar metro rail tunnel projects in Melbourne and Sydney will boost the construction sector over the next eight to ten years.

The most recent federal Department of Employment industry projections pinpoint health and social assistance as being the main area of job creation in the labour market since the 1990s, and that trend is expected to continue.

Health and social assistance, professional scientific and technical services, construction and education and training are forecast to provide more than 60 per cent of total jobs growth between 2017 and 2022.

Employment in health and social assistance is forecast to rise by more than 250,500 jobs, or 16.1 per cent, while jobs in professional, scientific and technical services are tipped to increase by 126,400, or 12.5 per cent.

The computer system design and related services sector is projected to swell by 54,200, or by almost one quarter, after having grown by nearly 84 per cent over the past decade.

Construction industry jobs are predicted to grow by 120,700, or 10.9 per cent, while employment in education and training is expected to increase by 116,200, or 12 per cent.

There are expected to be fewer jobs in manufacturing; electricity, gas water and waste services; and agriculture, forestry and fishing.

 

 

Article source here.

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Finding a home loan when you’re self-employed.

There are many perks to working for yourself, but when it comes to applying for a home loan, it seems being your own boss sends up a red flag to banks and other lenders. Why? A salaried employee has a regular, steady income and is less likely to experience the cash flow volatility of a small business owner, contractor, entrepreneur, tradesperson or freelancer.

Yet by being proactive and accessing specialist advice, self-employed applicants can also enjoy a successful and hassle-free road to securing a home loan. Try these top tips for starters.


1. Seek expert advice

Trying to navigate the home loan landscape solo may not produce the outcome you desire. There are many experts who can help self-employed people access a home loan, and a mortgage broker is a good first port of call. They will be able to provide you with an up-to-date overview of which lenders on their panel are most comfortable lending to the self-employed, and also explain what sorts of loan products are available. They can also provide valuable advice around the sort of documentation you will need to have ready before you submit your application.


2. Get your affairs in order

Many lenders will lend to self-employed borrowers who provide their full business financials. This generally includes your personal and business tax returns for the past two years. If you have these documents on hand – and they reveal a fairly consistent income – applying for a loan should be relatively straightforward.

However, the hectic schedule that comes with running your own business means many self-employed borrowers’ tax returns are not up to date. If you have time on your side, consider working with your accountant to lodge your outstanding returns. If you’re in a hurry, you may wish to explore the option of applying for a low doc loan.


3. Consider a low doc loan

Low doc loans are offered by a wide range of lenders and, as the name suggests, require less documentation than traditional loans. Many low doc loans only require 12 months of business activity statements instead of full financials, for example. A downside of some low doc loans is that they may only be available at a lower loan to property value ratio (LVR), which means you may need a larger deposit.


4. Do your homework

Checking your credit history is a good step for anyone applying for a home loan. If you’re self-employed, it’s definitely worth taking the time to make sure your credit history doesn’t include any defaults or errors – these can hold up your loan application if they are not rectified in advance.

Taking the time to work out exactly how much you’d like to borrow is also a good idea. That way, you can hit the ground running when you meet with lenders or your mortgage broker.


5. Think outside the square

It may be possible to apply for a home loan using a Certificate of Income Declaration – a document that verifies your income and is signed by your accountant. It’s wise to consult a mortgage broker before applying for a loan in this way, as he or she can advise which lenders will accept an income declaration. It should be noted, however, that applying for a loan using such a document may mean that the required LVR (the portion of the property value you can borrow) may be lower, so you may need a larger deposit.

While it’s a little more complicated for self-employed borrowers, getting a home loan can be easier than you’d imagined with a mortgage broker in your corner. Speak to your broker to find out how a broker could help you secure a home loan.

Source: PLAN Australia: Your Loan Hub

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New Year resolutions: Strengthening willpower

As the clock strikes midnight to mark New Year’s Day, this is the time that we often begin to reflect on what we have achieved over the course of the last 12 months. Part of this reflection can also make us focus our attention on specific aspects of our life we may feel that we have neglected up until this point.

As such, roughly 41%* of us find ourselves devising a New Year resolutions list often with the aim of restoring a sense of balance in our life – this can entail a shifting of our priorities through the redistribution of time, effort and sometimes money.

 

According to TwitterAU, here were the most tweeted New Year resolutions in 2017 by Australians:

 

TwitterAU

Top 10 New Year Resolutions in 2017

(Australia)
Ranking Resolution
1 Read more
2 Diet
3 Exercise
4 Learn something new
5 Be nicer
6 Get a new job
7 Volunteer/donate to charity
8 Get a boyfriend/girlfriend
9 Relax more
10 Quit smoking

 

Other common New Year resolutions tend to focus on enjoying life to the fullest, getting organised, reducing debt and spending less to save more.

Unfortunately, if you read our article, “Does a New Year Resolution set you up to fail?”, you will find that 25% of us ‘throw in the towel’ within the first week of making our resolutions. This percentage steadily increases with the passage of time (i.e. 29% in two weeks, 36% in one month and 54% in six months) – and, when all things are said and done, 88% of New Year resolutions fail. This may help to explain why our resolutions tend to be the same year after year.

As such, when establishing or reviewing your existing New Year resolutions list, it’s important to:

  • Carefully consider your goals; are they realistic in their obtainment and do they hold specific relevance and meaning to you? By considering this first, you may find that you start off on the right foot and subsequently increase your chance of adhering to the path that you set for yourself in the achievement of your goals. This can be referred to as the contemplation stage.
  • Put in place an appropriate plan (e.g. how are you going to get to where you want to be, such as the steps required and an appropriate support network) and then start making your goals a reality. A plan gives you a sense of direction and an appropriate network of people can provide you with support along the way, and with that, you are able to move from thinking about doing something to actually doing it. This can be referred to as the action stage.
  • Periodically review your progress. Keeping track of how you are progressing towards your goals will not only give you an indication of what you have achieved to-date, but also allow you to gain a greater understanding of your current position in relation to your goals – this can often be done after important milestones have been reached. This can be referred to as the review stage.
  • In a similar vein to above, proactively reaffirm your goals in the face of setbacks. Life often has a habit of getting in the way of our best intentions. In these situations, it’s important to appropriately address any setbacks that may occur, reach out to your support network, make any adjustments where required, and then refocus your attention to the goals at hand. This can be referred to as the reaffirm stage.
  • Lastly, once you have reached your goals, it’s important to maintain, and in some instances build upon, what you have achieved. After all the hard work, it can sometimes be easy to fall back into old habits, which may see you ending up right back at square one. Like the milestones that lead to your goals, think of the completion of your goals as another stepping-stone to something else. This can be referred to as the completion stage.

In addition, to the list of resolutions that you may have already set, give thought to any areas of your personal finances that may also require some attention. Here are a few personal finance-related resolutions you may wish to consider:

  • Talk to your partner about your existing financial situation, as well as the goals and objectives you would like to work towards now and into the future.
  • Familiarise yourself with your Money Personality and increase your financial literacy with the resources on our Financial Knowledge Centre.
  • Organise your finance-related paperwork in a filing system and actively engage with any statements you may receive e.g. investment and superannuation statements.
  • Establish an emergency buffer.
  • Make sure you have a suitable Plan B in place to insure against unexpected events that may occur in the future e.g. general and personal insurances.

Focusing on areas that need attention and making the required changes in your life can sometimes be difficult, especially when things have become engrained in your daily habits; however, the results can be truly amazing when you look back at where you started and what you needed to do to achieve the goals that you set for yourself.

When it comes to areas of your personal finances, remember that you do not have to tackle these on your own. If you need help, please do not hesitate to book a time to have a chat with us.

 

 

Article source here.

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Managing your budget at Christmas time

Christmas is the time of year for giving, and it also comes in the middle of the summer holidays when kids are out of school and families often take trips together. All of this can put a major strain on your wallet if you are not careful. Read on for our tips to help you survive the festive month without burning a hole in your pocket and completely destroying your budget.

Start Out with a Plan

The best way to ensure that you stick to a Christmas budget is to have one in the first place. Start by listing all of the people you need to buy gifts for, along with how much you can afford to spend in total. Once you have established the total amount, you can start allocating your total funds to each person on your list. This way, you’ll have a guideline to follow when you begin your shopping, which can help to keep you from going overboard.

Shop Smart

Even if you don’t have a budget in place, you can still save a bit of coin this holiday season. Instead of shopping at the priciest shops, look for some unique boutiques in your area that may have unusual items that you wouldn’t find anywhere else. Be sure to always check the sale racks as well; you never know what hidden gems you might find!

Take Your Time

Don’t force yourself to try to get all of your Christmas shopping done in one day. This can often lead to purchasing items that are more expensive than necessary, simply to get the job done. Give yourself plenty of time to shop around for great deals and to find the perfect gifts for each person on your list.

Get Ahead for Next Year

Although it may make your head spin to start thinking about next Christmas already, now is the perfect time to start planning for next year. Add up the total amount of money you spent on gifts this year, and divide that number by 11 (the number of months remaining until it’s time to start next year’s shopping). This will give you the amount that you should set aside each month so that you’ll have all the money you need by the time next Christmas rolls around.

Don’t let your Christmas shopping dig you into a massive financial hole. Follow the tips outlined here to help you stay on track and keep your spending in check, this year and in the Christmas seasons to come!

 

Article Source here.

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‘Pre-boomers’ embracing online shopping.

Senior couple surfing the net

“Pre-boomers” – the parents of baby boomers – are set to become the fastest-growing group of online shoppers, new research has found.

A report by the Commonwealth Bank says pre-boomers – who are aged 70 or older – are embracing online, with internet shopping by the group projected to increase by 18 per cent in the year ahead.

Commonwealth Bank retail industry national manager Jerry Macey says while Gen Y still dominates the internet marketplace, their grandparents will be responsible for the fastest growth in online sales to any one age group.

“The older generations will be a strong driver of online sales growth in the coming year, with purchases from pre-boomers expected to grow at twice the rate of the average Australian shopper, albeit from a low base,” Mr Macey said.

Gen Ys, aged 22 to 35 years old, account for 34 per cent of all online purchases but their share of online shopping is set to grow just five per cent over the next year.

Pre-boomers, however, are expected to account for nearly 15 per cent of online purchases – an 18 per cent increase, and up from 12 per cent a year ago.

The Retail Insights report, based on a survey of about 1,500 Australian consumers and a second survey of about 500 retailers, also found that around one in five purchases by more-affluent baby boomers is expected to be online.

Online purchases via a mobile device are forecast to grow three times as quickly among baby boomers – who are aged 51 to 70 – over the next 12 months as those mobile purchases by Gen Y.

Retailers and consumers said they expect online and mobile sales will grow significantly in the months ahead, with retailers forecasting a 24 per cent lift in volume over the next year, the majority coming from people shopping via a smartphone.

If the expectation is proven correct, online transactions will account for almost one in three purchases by July, 2018.

Despite this growth, the vast majority of shoppers still prefer to buy in-store (59 per cent) rather than online (16 per cent), the surveys found.

“Shoppers still want to touch and feel items before they buy, look for better prices online or just aren’t ready to purchase on the spot,” Mr Macey said.

Petrina Berry (Australian Associated Press); (Article source here)

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Recognising and dealing with financial stress.

At some point in your life, you may have experienced a certain level of financial stress.

This may have been due to one or a combination of issues, such as managing your debt obligations, running your household budget, and/or handling the financial considerations of a life event (e.g. marriage, birth of a child, job loss, a sickness or injury, divorce, or retirement etc.).

Recognising and dealing with financial stress is important. If left unchecked, it may lead to an overwhelming feeling or disengagement towards your personal finances, which in turn may affect your ability to focus and work towards achieving your financial goals and objectives.

 

Recognising financial stress
The first step towards dealing with financial stress is recognising that it’s present.

According to the most recent Australian Attitudes and Behaviour Tracker survey*, close to a third of Australians find dealing with money stressful and overwhelming. Furthermore, the Australian Bureau of Statistics^ proposes several potential indicators that a household may be experiencing financial stress. For example, to name a few:

  • You spend more money than you receive
  • You find it difficult paying your bills (e.g. utilities, insurance, registration etc.) on time
  • You cannot afford a night out once a fortnight
  • You are unable to raise $2,000 in a week for something important
  • You cannot afford a holiday for at least one week a year.

Depending on your personal circumstances, you may find that none of these indicators are relevant to you; however, despite this, you may still feel that financial stress is present in your life.

Although each person is different, perhaps one way to identify whether you are experiencing financial stress is to take a few minutes and think about how you currently feel towards each of the areas of your personal finances (e.g. cashflow, debt management, investments, superannuation, insurance planning, taxation and estate planning). For example, ask yourself, “Is there one particular area, or multiple areas, that I feel overwhelmed or disengaged with?” If the answer is yes, consider what the underlying issue or issues may be.

Pinpointing the source of your financial stress can help you to explore and apply appropriate strategies for dealing with it that are relevant to you.

 

Suggestions for dealing with financial stress
Whilst the appropriate strategy to deal with financial stress may depend on the underlying issue causing it in the first place as well as your own personal circumstances, we have provided you with a few suggestions, mostly centred on getting your personal finances in order, which you may find helpful:

1. Talk to your partner. This can help you to both be on the same page when it comes to assessing your existing financial situation, and working together towards achieving your financial goals and objectives moving forward. In addition, by having an open and honest conversation, this may also assist you with the implementation of some of the other suggestions listed below.

2. Seek help from your professional advice team. In our module, ‘Building Your Team’ and our recent video, ‘Teamwork, leverage and achieving a common goal’, we touch on the benefits of teamwork. This is especially important when you take the time to consider the different areas of personal finance, their interconnectedness and the diverse range of skillsets required to bring these all together to help you in a meaningful and comprehensive way. Furthermore, it’s important to remember that we can help you with many of the other suggestions listed below.

3. Get to know your Money Personality and increase your financial literacy by spending time on our quizzes, modules, and calculators (not to mention our articles, videos and life events!). This can enable you to better understand your natural personality preferences for dealing with money and improve your knowledge in the topics that relate to your personal finances.

4. Keep your finance-related paperwork in a filing system. This may include, superannuation and investment statements, estate planning documentation, general and personal insurance policies, product disclosure statements, debt documentation, bank statements, PAYG statements, and past tax returns (and receipts for future returns) just to name a few. This can assist you with the organisation of your personal finances and allow you to find and refer to things with greater ease.

5. Put in place a budget or revisit the one you already have. This can help you to gain a better understanding of your cash flow and an overall picture of your personal financial statement, as well as allow you to assess your household expenditure (and, subsequent surplus income potential). In doing this, you may find it easier to manage your money to meet future expenses, track and review your spending habits over time and devise plans to utilise surplus income for debt reduction, saving, and investing.

6. Establish an emergency buffer. Life can be full of unexpected events, but by pre-planning an emergency buffer, you can have funds available to cover unexpected events such as job loss, a medical emergency, home repairs and car repairs without the need to rely on other sources (e.g. credit cards and borrowing).

7. Get a handle on your debt repayments. In some respects, debt may be a necessity (i.e. home loan), whilst in other circumstances (e.g. credit cards) it may be used to spend more money than you receive. Either way, in the end, debt repayments restrict your cashflow and, if not carefully managed, can cost you money in interest that could have been better targeted towards something more beneficial to you. By repaying your debt obligations as soon as possible, you can free up cashflow to be used for other purposes such as saving and investing for the future.

8. Track down any lost superannuation and consider the consolidation of multiple superannuation accounts. As at 30 June 2016, there were 5.7 million lost and ATO-held superannuation accounts with a total value of roughly $14 billion. Furthermore, roughly 43% of people had more than one superannuation account*^. For further information on these two suggestions, please read our articles, “How to find lost super” and “Multiple super accounts and you”.

9. Make sure you have a suitable Plan B in place. Appropriate types and levels of general insurance (e.g. motor vehicle, private health or home and contents) and personal insurance (e.g. life, total and permanent disability, income protection and trauma) are a safety net that can provide you with peace of mind financially when an unexpected event occurs.

10. Consider selling household possessions that have been collecting dust. This extra cash may provide you with breathing space to meet upcoming expenses, establish an emergency buffer or top-up your existing savings. In addition, by updating your contents insurance to reflect this reduction, you may see a lowering of your relevant insurance premium.

11. Be proactive in planning for retirement. Understandably, it can be hard to engage with the topic of retirement, especially if it’s far off in the distance and you have competing priorities right now; however, by starting sooner rather than later, you can benefit from the power of compounding and give yourself flexibility if things change along the way. For further information, please read our articles, “Future self-continuity: Preparing for the future” and “Running the retirement race”.

12. Make sure your estate planning affairs are in order. By completing or reviewing your will and the nominated beneficiaries to your superannuation, you can make sure that your wishes are carried out in the event of your passing. Furthermore, this suggestion also extends to making sure you have procedures in place regarding the management of your affairs whilst you are still alive (e.g. powers of attorney and guardianship).

13. Take care of your physical and mental health. For example, eating a balanced diet, engaging in adequate exercise, allowing yourself time to rest, and acknowledging your achievements to date, may help you to reduce your overall stress levels. Furthermore, depending on your personal circumstances, this may also have positive outcomes when it comes to an insurer’s reassessment of health-related exclusions or loadings on your existing personal insurances.

Financial stress can arise at any point in your life. The cause and the subsequent level of financial stress that develops can vary. It’s important to recognise and deal with financial stress when it does present itself. Although the above suggestions are not a comprehensive list, you may find that getting your personal finances in order can help with alleviating the underlying cause of your financial stress.

As always, if you feel that you do need help in a specific or variety of areas related to your personal finances then please contact us.

Financial Knowledge Centre; (Article source here)

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House hunters turn to Brisbane.

House hunters are steering away from Sydney and Melbourne and turning their attention to Brisbane, according to property data group CoreLogic.

Investors are being turned off by affordability constraints in Sydney and Melbourne, and the sentiment that both markets are currently at their peak, CoreLogic head of research Tim Lawless says.

More investors and prospective buyers are now looking at Brisbane, as recent migration growth and improving job prospects make it more attractive, he said.

Queensland’s unemployment rate has tumbled in recent months, falling from 6.5 per cent in June to an 18 month low of 5.7 per cent in August, according to the latest data from the Australian Bureau of Statistics.

“I think one of the missing pieces of the Brisbane puzzle up to date has been the fact that there hasn’t been much jobs growth,” Mr. Lawless said.

“This is one of the reasons why we haven’t seen Brisbane values growing to the same extent as Sydney and Melbourne, despite affordability and the decent rate of population growth.

“It hasn’t been a very strong economy but that seems to be changing now.”

In the past 12 months, Brisbane’s home prices have jumped 2.9 per cent. That compares to a 10.5 per cent increase in Sydney and a 12.1 per cent rise in Melbourne.

But Mr. Lawless said an oversupply of apartments could have investors treading cautiously.

In September, the Reserve Bank of Australia said Brisbane was still at risk of a potential for an oversupply of apartments which would drag property prices lower.

RBA assistant governor Luci Ellis then said second-hand apartments will likely fall in price as tenants move into newly built homes because they are nicer and rent is still low.

Mr. Lawless said, while Brisbane is at a higher risk than Sydney and Melbourne because of a substantial uplift in existing unit stock, the threat is starting to subside.

“Brisbane has already moved through the peak of the construction pipeline – back in December last year – so it is already starting to come down a little bit,” he said.

Recent data from CoreLogic shows investors are also looking outside of the major capitals to regional areas where growth rates have been remarkably strong, particularly in areas adjacent to the Sydney metro area.

NSW’s Newcastle and Lake Macquarie were the strongest regional performers with home prices up 15.3 per cent over the past 12 months, according to CoreLogic.

In Victoria, the strongest regional market was Geelong and in Queensland, the Sunshine coast was the most popular.

Mr. Lawless said more and more people are using their equity in their property to buy lifestyle properties such as holiday homes or future retirement premises.

“The metro areas and the major capitals have just become too expensive,” he said.

Simone Ziaziaris (Australian Associated Press); (Article source here)

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