Protecting your loved ones: Child trauma benefit

When considering personal insurances, often you may first think about protecting your household financially from unexpected events (e.g. a passing, sickness or injury) that may occur to yourself; however, unfortunately unexpected events can also happen to your loved ones, which can have a similar result in terms of the financial impact on your household.

Due to this, in our animation, “Personal insurance for families”, we touch on the concept of cross insurance, namely, insuring both heads of the household whether they be dual income earners or a sole income earner and a non-working spouse.

 

Similarly, it’s also important to consider the financial impact on your household if your child was to unexpectedly pass away or suffer a sickness or injury. Common questions worth considering, especially regarding a sickness or injury, are:

  • Do you have the adequate resources available to pay for any immediate and ongoing medical treatment, or home and/or care modifications that your child may require?
  • How would you cope financially if you or your spouse needed to stop work to care for your child either on a temporary or long-term basis?

 

Child trauma benefit
Some insurers offer a unique type of personal insurance that is specifically tailored to cover your child. This type of personal insurance is called the Child Trauma Benefit and can come as either an in-built inclusion or an optional extra (with its own insurance premium payable) to your Trauma insurance policy.

The Child Trauma Benefit provides a lump sum payment to you if your child was to pass away or suffer a specified medical event. Depending on the insurer, and whether the Child Trauma Benefit is an in-built inclusion or optional extra, the lump sum payment amount can be either fixed (e.g. $10,000) or an amount specified by you upon application (e.g. up to a maximum sum insured, such as $200,000). Furthermore, in the event that the Child Trauma Benefit is an optional extra, and the amount specified as the sum insured reaches a certain threshold, you may find that underwriting is required.

 

Medical events covered
The medical events covered under a Child Trauma Benefit can range between insurers. In addition, the medical events covered usually are not as extensive as those under an ordinary Trauma insurance policy. As such, below is a list of some of the medical events that you may find covered under a Child Trauma Benefit:

 

Child Trauma Benefit

Medical Events
Cancer events
Benign brain and/or spinal tumour Invasive cancer
Leukaemia Hodgkin’s disease
Malignant bone marrow disorder Skin cancer
Coronary events
Cardiomyopathy Heart attack
Stroke
Other serious events
Accidental HIV infection Aplastic anaemia
Bacterial meningitis Blindness
Brain damage Chronic kidney failure
Chronic liver or lung disease Coma
Intensive care Loss of hearing
Loss of use of limbs and/or sight Loss of speech
Major head trauma Major organ transplant
Multiple sclerosis Muscular dystrophy
Paralysis (e.g. diplegia, hemiplegia, paraplegia, or quadriplegia) Severe burns
Viral encephalitis
Terminal illness

 

Things to consider
When it comes to the Child Trauma Benefit, there are several important considerations. Although these may vary between insurers, listed below are few (although not a comprehensive list).

Policy eligibility, cessation and conversion
You may find that the Child Trauma Benefit:

  • Is only available to your child if they are within a specified eligibility age bracket. For example, between 2 and 15 years.
  • Has a cease date that often refers to a period just after the upper limit of the specified eligibility age bracket has been reached. In addition, this can also occur if the relevant Trauma insurance policy that holds the Child Trauma Benefit ceases.
  • Has the capacity to be converted to an ordinary Trauma insurance policy for the child just prior to them reaching the policy cease date related to the upper limit of the specified eligibility age bracket. In this circumstance, the policy becomes their own; however, depending on the sum insured, underwriting may apply.

Guaranteed future insurability
You may find that you are able to increase the sum insured by a predefined amount (up to a maximum limit) upon certain milestones being reached, such as the child’s 6th, 10th and 14th birthday, without an assessment of your child’s health.

Exclusions and qualifying period
You may find that the Child Trauma Benefit will not be paid in the event of one of the following:

  • The medical event is caused by a congenital or pre-existing condition, an intentional self-inflicted injury, or attempted suicide.
  • The medical event arises within three months of the commencement of the insurance policy.

Partial or full payment
Depending on the medical event that arises (e.g. type and severity), you may find that a partial or full payment is made under the Child Trauma Benefit.

 

Moving forward
We may not like to consider the thought of our child unexpectedly passing away, or suffering a serious sickness or injury; however, unfortunately it can happen. As such, in the event of an unexpected event, the Child Trauma Benefit aims to help ease the financial stress that may occur to you and your household during this distressing time.

Although in this article we have provided a general overview, the Child Trauma Benefit can vary considerably among insurers. Consequently, it’s important to seek professional advice and read the relevant Product Disclosure Statement.

If you would like to know more about the Child Trauma Benefit, please do not hesitate to book a time to have a chat with us.

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Healthy tips to follow for 2018.

Swapping treats for a piece of fruit or walking an extra block each day are small, simple changes that could make a huge difference to a person’s health and wellbeing in 2018.

As Australians prepare to celebrate the end of 2017, VicHealth has put together a list of eight handy tips for people to follow in the New Year.

Being healthy is easier said than done but it does not have to be chore, says VicHealth Executive Manager of Programs Kirstan Corben.

“Setting small, realistic goals helps to make them more achievable and less daunting, which means you’re more likely to stick to them.”


Eight Healthy Habits for 2018

 

1. Cut back on sugar

One simple way to avoid excess sugar is to swap sugary drinks for water. Sugary drinks like soft drinks are the largest source of sugars in the Australian diet, and they can lead to weight gain and tooth decay.

2. Reduce alcohol consumption

It’s all about moderation. Drink water in between alcoholic drinks. Remember, alcohol contains a lot of empty kilojoules.

3. Make exercise part of the holiday

Being active helps us to clear the mind, feel energised and importantly reduces our risk of nasty chronic illnesses like diabetes and heart disease.

Try parking the car at the far end of a car park, play a family game of cricket, or do some laps at the local swimming pool.

4. Don’t pass the salt

Salt increases the risk of high blood pressure and the risk of cardiovascular diseases like heart attack and stroke. To cut back salt fill up on fresh fruit and vegies and use herbs, garlic and pepper to food flavour.

Buy low salt versions of your favourite foods and where possible cook instead of getting takeaway.

5. Stress less

Stress can impact our physical health, making a person more prone to illness, and it also impacts mental wellbeing. Make time to read a book, go for a run, listen to music or just sit in a park. Activities such as yoga, can also help keep stress at bay.

If you feel like you’re not coping, contact a support service like beyondblue.

6. Help your kids ditch screen time

Too much screen time can impact kids’ sleep and reduces the amount of time they spend being active. Swap screens for the great outdoors.

Take the kids to the beach or go for a bushwalk.

7. Look out for each other

Social connection is important for strong mental wellbeing but for many people Christmas and the New Year can be a lonely time. Keep an eye on your friends, neighbours and loved ones and offer support when needed.

8. Quit Smoking

It’s never too late to quit. Research shows smokers who quit at age 50 halve their risk of death caused by smoking, while quitting by age 30 avoids almost all of the excess risk associated with smoking. For support visit here.

 

Article source here.

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What you should be aware of if you have Power of Atty. for a senior.

Many of us want to care for our ageing loved ones; but this isn’t always straightforward – especially for the “sandwich generation” who have the added pressure of caring for children at the same time. This is why it’s essential to be aware of the issues that can arise, particularly if you have power of attorney for a senior. Here we take a look at the legal implications and the questions you should be asking if you’re going to take on this responsibility.


What is a Power of Attorney?

Powers of Attorney are legal documents through which someone – often an elderly relative – gives you the authority to make important decisions on their behalf if they are no longer able to do so. There are two main Powers of Attorney you can be granted:

  • Enduring Power of Attorney. This gives you the authority to manage the financial affairs and in some cases, personal affairs of someone who has nominated you, if they are unable to do so.
  • Medical Power of Attorney. This makes you responsible for decisions about the medical treatment of the person who has nominated you if they have become mentally or physically unable to make these decisions themselves.

However, the rules on Powers of Attorney differ between states and territories – it’s important to check the law where you live before you agree to anything.


Considerations before agreeing to be someone’s attorney

Taking on power of attorney for someone is a serious, legally binding responsibility. If someone wants to nominate you, make sure they are willing to discuss it thoroughly with you first so you can decide if this is something you really want to do. It’s important to understand exactly what they expect from you – taking on responsibility for their finances, for example, could mean they expect you to take over a business they run, or even pay their debts.

Remember, this responsibility might not come into effect straight away – the person who nominates you chooses when your power of attorney should start. This may not be for many years if they continue to be capable of making their own decisions. It’s important to think about what you want from your own life in the future before you accept the responsibility.

Once you’ve accepted, you can’t then delegate the responsibility to anyone else. However, the person nominating you can nominate more than one attorney. You are all obliged to act in that person’s best interests at all times but sometimes attorneys can disagree over decisions and a consensus has to be reached. If the other attorneys are family members or close friends, this can cause a strain in your relationships with them.

Perhaps the most important thing to think about is that having power of attorney for someone means you are likely to have to make some very difficult decisions on their behalf – from how their money is spent to where they are going to live, and possibly even what medical treatment they should receive. It is a lot of responsibility and can be painful to act as an attorney for someone you’re close to. However, it can be a huge relief to the person who has nominated you if you agree.


What are the responsibilities of an attorney?

Your responsibilities depend on what powers of attorney you have been granted. It’s essential that you do not overstep these at any time – the wishes of the person who has granted you powers of attorney have to come first at all times. Most people retain some decision-making capacity for the whole of their lives; so even if the Power of Attorney has already come into effect and you have the legal responsibility for decisions, their wishes should still be respected.

Just because someone is old, it doesn’t mean they don’t know their own mind. If you suspect they might have lost the capacity for decision-making, you should have them assessed by a medical professional. Once their incapacity is confirmed, you should start acting as their attorney straight away to make sure their rights and assets are protected.


What are the legal obligations of having power of attorney?

You have a legal obligation to act honestly at all times. You should keep detailed records of any decisions or transactions you make on the other person’s behalf so everything is completely transparent.

You are also legally obliged to obey the wishes of the person who nominated you. If you deviate from them at all, even if you believe you’re acting in their best interests, you can have legal action brought against you. You would then be liable for the cost of any compensation the court decided was owed.

As soon as you sign a Power of Attorney document, it becomes legally binding. It’s vital that you talk it over thoroughly and think about it carefully before agreeing to take this step.

(Feedsy Exclusive); (Article source here)

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How much are aussies losing in loose change?

Australians are losing about $466 million a year in loose change which they consider inconvenient and too bulky to carry around, a survey has found.

The ING study found millennials were the worst culprits, with almost half of people aged 18-34 losing up to $10 a month in loose change.

ING’s Tim Newman says most people don’t think twice about throwing away coins.

More than a quarter of people said they ‘hate carrying coins’ and the three biggest reasons were because they ‘couldn’t use five cents’, it was ‘inconvenient’, and it ‘bulks up their wallet’, the study found.

Despite this, almost half of people said they felt happy when they found money.

“It’s ironic that many people will actually throw away their spare change, however, get satisfaction out of finding money,” Mr Newman said.


WHO THROWS AWAY $10 IN COINS A MONTH?

  • * 40 per cent of people aged 18-34
  • * 36 per cent of people aged 35-49
  • * 19 per cent of people aged 50-64
  • * 15 per cent of people aged 64 and over


WHICH STATES DO THEY COME FROM?

  • * 32 per cent in WA and Victoria
  • * 30 per cent in NSW
  • * 25 per cent in Queensland and SA


HOW MUCH DOES IT COST US?

  • * $466 million a year in lost change across Australia
  • * $38.85 million a month all up
  • * An average of $2.10 per person a month


WHY DO AUSTRALIANS THROW AWAY LOOSE CHANGE?

  • * 40 per cent of people say they can’t use five cent pieces
  • * 29 per cent say it is inconvenient to keep change
  • * 27 per cent say it bulks up their wallet

 

WHAT CAN YOU DO IF YOU HAVE LOOSE CHANGE

  • Go to the nearest bank and put it in a coin counter. Get the receipt, take it to the teller and pick up your money or put it in your bank account.
  • Use these loose change for parking meters or at your local launderette.
  • Save it up for when you really need it in the future.

 

 

David Sigston (Australian Associated Press);(Article source here)

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Running a small business? Here’s how to maximise your tax benefits.

For many small business owners, ensuring your tax obligations have been met can be a frantic time. The stress can be alleviated if you do a little planning – before you sit down with your accountant, it’s worth making sure you’ve got all the information in place that he or she will need in order to make sure your business meets its tax obligations. Here’s our guide for small business on maximising tax benefits.


What information do I need to provide? 

The Australian Tax Office (ATO) requires various information from small business owners. It’s important to know what all these documents are so you can have the relevant information ready for your accountant.

  • Profit and Loss Statement – this is a summary of your business’s income and expenditure for this financial year.
  • A summary of your debtors and creditors.
  • Records of any assets you’ve purchased or improvements you’ve made to existing assets – this will enable you to calculate depreciation expense claims and work out how much Capital Gains Tax you owe.
  • Conduct a stocktake – this is an ATO requirement. The value of stock that you record in your accounts by the end of June will be included in your profit figure, and will therefore affect the amount of tax that you have to pay. However, you are exempt from conducting a stocktake if you believe there is less than $5,000 difference from your stock value last year.
  • Lodge your yearly reports for PAYG, Fringe Benefits Tax, Goods and Services Tax, and the taxable benefits reporting system.
  • Lodge your income tax returns.
  • Make sure you meet the requirements of SuperStream, the data and payment standard that you have to use to make superannuation contributions for your employees. All your employees’ details and payments must be up-to-date.

Essential information to prepare
This process can be made much easier if you make sure your records are up-to-date in advance. Before you meet with your accountant, check that all the information in your Business Activity Statement (BAS) is current and correct, as well as completing your PAYG reconciliations. If you have a Self Managed Superannuation Fund (SMSF), you’ll also have to make sure all your earnings and tax obligations are worked out correctly.
Ensure that your invoices are all in good order, as this will make life easier for you and your accountant when putting your financial statements together.

As tax laws can change quite dramatically from year to year, it’s important to stay up-to-date with current legislation. Discuss any change with your accountant to find out how you can best make it work for you.


Potential areas for savings
In order to complete your profit and loss statement, you will need to chase any outstanding payments from your customers. However, it may not be possible for you to recover them all – if this is the case, you may be able to write them off as bad debts. This will enable you to claim a tax deduction.

It’s also important to work out whether it’s worth spending out at this time of year on items you need for your business, or making extra superannuation payments. This year in particular, it’s worth purchasing as much essential equipment as possible, due to the $20,000 instant asset write-off scheme being in place for another year. If any of the equipment you need to run your business requires an upgrade, now is the time to replace it. You will only be able to claim for $1,000 of assets next financial year.

Another way to reduce your taxable income for the coming year is to consider pre-paying for services up front, such as paying in advance for 12 months’ worth of rent or insurance. You’ll always need these services, so it’s a good idea to use them to reduce the amount of tax you have to pay.


Questions to ask your accountant
It’s important to make sure you’re getting the best deals from your service providers. Have a look at how much your business is spending on banking, broadband provision, and insurance, and check if savings could be made in any of these areas by switching to another provider.

This is also a good time to have a look at the overall financial health of your business with your accountant. Looking at the figures for this financial year will enable you to see which areas of your business have grown and where improvements need to be made. This way you will be able to make accurate financial projections and budget more efficiently for the year ahead so you can set realistic goals for where you want your business to be in 12 months’ time.

 

If you have any more questions, feel free to drop us a message or give us a call and we’ll be very much happy to assist.

(Feedsy Exclusive); (Article source here)

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What is objective-based financial advice and why should you seek it?

Objective-based financial advice has become hugely popular over the last few years in Australia. How does it differ from more traditional financial advice and why should you be asking your adviser about it?


The difference between traditional and objective-based advice

Traditionally, financial advice has tended to be more general – the ways in which you’ve been advised to invest your money have been based on assessing risks to work out the chances of the best financial outcomes. However, this strategy doesn’t take into account your own personal needs and goals for the different stages of your life.

Objective-based advice requires your financial adviser to take a much more in-depth look at who you are, what stage in life you are at, and what your short, medium and long-term goals are. This enables them to draw up a financial strategy that’s individually tailored to you. The aim is to equip you to meet all your current and future financial commitments and achieve the lifestyle you aspire to by making the money you have now grow to provide you with the life you want in the future.


The benefits of objective-based advice

The main benefit of objective-based advice is that it doesn’t make generalisations – it actually looks at who you are. People’s financial goals are likely to be very different depending on their individual circumstances.

For example, a couple with no dependents are more likely to aspire to have a stable income in retirement, with enough left over for the things they enjoy, such as holidays. A couple with children are much more likely to want to leave something behind for their children to inherit, so they’ll be more concerned about putting money away. Objective-based advice will not treat these two couples the same way or use similar investment strategies for both of them, as they want very different outcomes.

The other main benefit of objective-based advice is that it enables you to build a much more trusting relationship with your financial adviser due to their better understanding of you. This makes it more likely that you will listen to their advice.


How can defining your objectives help you control your financial future?

Defining your goals is a vital part of planning for the future. Writing down a specific plan with a financial professional will help you to establish what your goals are, and give you a permanent written reminder of them. This gives you a focus and an understanding of the steps you have to take so that you can achieve the lifestyle you want.

This is likely to help you curb impulse spending, as reminding yourself of your goals is a powerful motivator. Once you have something tangible to work towards, you’ll be willing to forego other things in order to make your dreams happen. For example, you’ll probably be happy to live without an expensive holiday this year if it means you’ll be living in your dream home a couple of years down the line.

This is another reason why objective-based planning works – it takes into account your short- and medium-term goals as well as just those for the long term. Once you have defined your objectives, your financial adviser will draw up an investment plan designed to give you the returns that are most likely to help you achieve your immediate goals as well as your plans for the future. This means you’ll see results quickly, which will keep you motivated for the future.

In addition, having a clearly-defined plan will help you to keep your goals realistic. A lot of people become disheartened by having impossible dreams that they have no way of achieving. A good financial adviser will be encouraging but realistic about the goals you should be setting yourself, which will put you in greater control of your finances from the outset.


How often should you review your financial objectives?

There is no definite answer to this but it’s essential to review your objectives regularly, as they’re likely to change along with your circumstances at different stages of your life. However, you should avoid making unnecessary changes to your objectives – your plan should be a map that will ultimately take you where you want to go, without leading you off-course.

It’s advisable to review your plan at least once a year, and at any other time when things change in your life, such as getting married or starting a business. Major life events are likely to change your financial goals. It’s important to make sure you have a plan that continues to meet your needs as you journey through life.

 

Feedsy Exclusive; Article source here

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Super focused: Your annual super statement.

As a superannuation fund member, you’ll be receiving your annual statement soon from your super fund either electronically or through the mail.

Your statement is often a good touch point on how you’re progressing with your retirement nest egg. Regardless of your current stage of life, it’s important to review your statement, as superannuation plays a vital role in supporting you in retirement.

Before you file your statement away this year, take some time to consider the following.

Prior to receiving your statement, did you know your super balance?
An important part of goal-setting is knowing how you’re tracking and the information provided on your statement can help.

Interestingly, a recent study* found that 26% of Australians with superannuation did not know their superannuation balance whilst 42% had a rough idea and the remaining 32% knew exactly or almost exactly.

How close was your estimate?

Remember, superannuation is a form of saving. Just as you may know your ‘everyday’ and ‘saving’ bank account balances, it’s also important to take an interest in your superannuation balance.

 

Are you receiving the correct amount of Super Guarantee (SG) contributions from your employer?
Your superannuation balance grows from contributions and returns less tax and costs.

SG contributions are a type of concessional contribution.

SG contributions are compulsory contributions made by employers on behalf of eligible employees into their nominated superannuation account at least every three months. The current minimum SG contributions rate is 9.5% of a person’s ordinary time earnings (subject to a maximum contributions base).

It’s important to check whether your employer is contributing the correct amount into your superannuation account not only from an employee entitlement point of view, but also because these contributions will help you grow your retirement nest egg over time.

Your statement should list SG contributions in the transaction history.

 

Have you supplied your Tax File Number to your super fund?
Why is this important? If your super fund doesn’t have your Tax File Number then they are required to:

  • Tax concessional contributions at a higher rate than 15%. From 1 July 2017, the higher rate is 47%.

Your statement should list whether you have supplied your Tax File Number.

If you have not supplied your Tax File Number, your super fund will have information on how to update your member details.

In addition, if you provide your Tax File Number, your super fund may be able to claim additional tax from the three previous financial years back from the Australian Taxation Office and re-credit it into your superannuation account.

 

Did you receive statements from several different super funds?
If you have changed jobs over your working life, it’s possible that along the way you may have accumulated several different superannuation accounts.

Multiple superannuation accounts normally mean multiple sets of fees and costs, as well as differing asset allocations in some instances – all of which can affect your superannuation balance over time.

However, before you go rolling one superannuation account into another, in some instances it may make sense to retain multiple superannuation accounts – read our article, ‘Multiple super accounts and you’ for further information.

 

Did you discuss your statement with your spouse/partner?
Planning for retirement as a couple is a collective journey. Although, you may differ in some aspects (e.g. risk tolerances, money personalities etc.), you are a team, working towards the goal of accumulating wealth for retirement. And for most households, superannuation is the second largest asset held^.

Talking about your personal finances can be a truly beneficial discussion about where you are, where you would like to be and how you are going to get there. And remember, your financial adviser is here to help along the way.

 

Moving forward
Reviewing your statement is important.

Superannuation is a tax effective investment vehicle that will help you accumulate wealth during your working life to support your lifestyle in retirement.

Going through the five questions above and other important information in your statement (such as your investment mix, nominated beneficiaries, personal insurances and fees) is a good discipline and can help you better understand where you are at with your superannuation.

Please contact us if you have any questions regarding your statement or how you are tracking towards your financial goals and objectives.

*ASIC and EY Sweeny. Australian Financial Attitudes and Behaviour Tracker: Wave 4 (September 2015-February 2016). Retrieved from here.
^Australian Government, Australian Bureau of Statistics. Household income and wealth levels. Retrieved from here.

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Top 5 best personal budgeting tips, no matter what your income.

A new financial year is upon us. The best way to own it is to plan now! Here are five of the best tips for making a personal or family budget, and sticking to it. Smart budgeting allows you to have enough for the things you enjoy, no matter what your age or income.

1. Work out your income and expenditure

The best place to start when you’re creating a budget for yourself or your family is to work out what comes in against what goes out each month. Write a list of your sources of income – your salary, any additional income from investments such as rental property, and interest on your bank accounts. Your income has to be factual rather than speculative, though – even if you’re due a pay rise or inheritance, don’t include them if they haven’t already happened.

Then work out your monthly expenses. Regular outgoings will include your mortgage or rent, insurance and household bills. Estimate your other expenditures, such as grocery and clothes shopping, as best you can.

Once you’ve done this, you’ll be able to have a realistic idea of where you need to make savings. You should aim to:

Earn more than you spend
Be able to afford occasional indulgences such as holidays, tickets to concerts or sports events, and dinner with friends
Put some money away each month as savings and to cover the cost of emergencies.
2. Make some necessary changes

This is often the most difficult part. You need to take a look at your expenditure and work out how much of it that you actually need to spend. If you haven’t been to the gym for months, you should cancel your membership. If you spend a lot on clothes, could you save yourself money by shopping at factory outlets or online? Even the cost of buying your lunch each day could shock you into making sandwiches to take to work. Small savings add up into much larger amounts over time.

You can also make savings by spreading the cost of big events like Christmas over the whole year, keeping an eye out for presents whenever the sales are on. This will save you spending out drastically in December and running up a huge credit card bill in January to make up the shortfall.

Don’t aim to deny yourself all the things you enjoy; just be sensible about what you spend to avoid unnecessary waste.

 

3. Make sure you’re getting the best deals

If you want to stick to your budget, it’s important to continually shop around, instead of sticking with your current arrangements out of convenience or habit. Some of these changes are really easy to make – you can save a lot of money on your grocery bills, for example, by shopping at budget supermarkets like Aldi.

Visit price comparison sites to make sure you’re getting the best deals on your energy, insurance and other services such as mobile phone and broadband. Families can often save money by choosing a bundled package for their phone and internet services, as these often work out cheaper than individual contracts. You should also consider switching your bank account and credit card if you could get better interest rates elsewhere.

Remember, if you do find a better deal on any of the services you use, you’re perfectly within your rights to ask your current provider if they’re prepared to match or better it. Many of them will in order to keep your business.

 

4. Adopt a more energy efficient lifestyle

You can live a greener, more sustainable lifestyle by making a few simple changes. It won’t just save you money; you’ll also know you’re doing your bit to protect the planet!

If you’re buying any new appliances, make sure you go for the most energy-efficient models. This could save you hundreds of dollars each year in household bills. Also, make sure you switch off all your appliances when they’re not in use, rather than just leaving them on standby, to reduce unnecessary energy use.

Make the most of the rebates offered for energy efficiency schemes. These vary between states, so check what’s available where you live. Many states now offer rebates on initiatives such as water-saving appliances and rainwater tanks.

 

5. Consider using a budgeting app

There are now many apps available which enable you to budget easily using your smartphone. These can be helpful because they can show you where you stand with all your sources of income rather than just your bank account. You can also set spending limits. The app will track what you spend and alert you when you approach your limit. Budgeting apps can also be useful for setting yourself financial goals and monitoring your progress.

There are a wide variety of budgeting apps on the market now for all the most popular operating systems – it’s worth doing some research to find the one that’s right for you.

Remember, budgeting isn’t about denying ourselves the things that make our lives enjoyable. It’s simply about giving ourselves a fair deal. No matter what we earn or where we live, none of us should be paying over the odds for goods and services we can get for less somewhere else. And with a little planning, you can achieve the lifestyle you want, and have a little put aside for a rainy day.

 

Consulting your financial adviser and accountant is always a good idea too.

(Feedsy Exclusive)July 26, 2017
(Article source here)

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How to Protect Your Intellectual Property.

Anything that you create from your own intellect that can be legally owned is your intellectual property (IP). In business, or as an individual with an invention, new process, or creative work that you can profit from in some way, you want to ensure that your IP is protected in order to prevent others from taking advantage of it, profiting from what you created, and infringing upon your rights. 

Your IP can hold a lot of value; for a business, it may be your most valuable asset! This is why many companies go to great lengths to secure their IP – and have a right to take any entity that tries to steal theirs to court.

National and international copyright laws exist in order to encourage innovation and to safeguard businesses, which require their IP to be protected in order to maintain a competitive edge. What exactly can be protected? How can you keep your IP safe in Australia and globally in order to stop other companies from taking advantage of your innovation, thus diluting its value to you, without your licence?


Types of IP
First, it’s important to understand what is protected and the different options that are available to you under intellectual property law.

Patents are used to protect a new process or an invention, safeguarding how something functions. New pharmaceutical medications and Post-it notes are examples protected by patents. The legal battle over who created the original Post-it notes is one of the more famous IP legal cases.

Trademarks are for the name of a brand or a logo, and can constitute any combination of numbers, letters, and shapes to identify the goods or services sold by one business over another. For example the Nike swoosh, or the brand name, Coles. You can also trademark a certain colour, sound, scent, or even how a product is packaged or branded.

A copyright is what is used for trade secrets, like a restaurant’s secret recipe. Creative works, like books, recorded music, film and television programs, and software programs can also be copyrighted.

Registered designs protect the visual appearance of a product. This differs from a patent, which protects the way something works, but not how it looks.

Less common, but essential for certain industries like the Australian wine industry –geographical indications are used to identify when a good has originated from a particular area.

Steps to Protecting Your IP
When you have identified your intellectual property, the first step is to ensure that it is kept confidential until it has been protected. Some companies choose to simply safeguard their intellectual property – which is what Coca-Cola has done with their ‘secret recipe.’ This also means that the trade secret is kept indefinitely – copyrights and patents only last for 20 years before the original creator is no longer the sole owner.

Next, register it with IP Australia. Before it is registered, other businesses or individuals can potentially steal your work and claim it as their own. If you haven’t registered your process, invention, or another piece of IP, then it may be difficult for you to prove that you are the legal owner in court.

Stay aware of any cases of infringement on your intellectual property. Infringement can take away from the owner’s market share, making it difficult for businesses to compete. For example, if a glass manufacturer has a patent for their glass making process; when a competitor uses the same process, then the two companies are producing an identical product. The company that spent millions developing the process now has lost its competitive edge.


How Much Does Registration Cost?
The costs will vary, depending on if you try to register on your own or hire a lawyer to help you. Also, the application fees for the different types of IP protection will vary. A copyright doesn’t have to be filed to go into effect. For example, once you write a story or record a song, it is technically your property. It is, however, helpful to have a work copyrighted if there is any concern over others stealing and using your work or trade secret.

Trademark can cost from $130 to $480 – per class of products or services, plus attorney fees, which may be around $1,000 for a straightforward application.

Patents, which are the most complicated in terms of registering, can cost between $5,000 and $8000, including attorney fees, plus annual maintenance fees.


What About International Protection?
Especially for smaller companies, it can be difficult to protect your IP outside of Australia. You will have to register in each country that you want protection in. Every country will have its own patent, copyright, and trademark laws, so make sure you are aware of what protection is offered once you register.

Trademarks can be filed through the Australian office, which then files with the other country.

Whether in Australia or abroad, registering your intellectual property as soon as you are ready is your best way to ensure that your IP is protected. An IP professional can help you fill out an application correctly and help you with any infringement issues.



(Feedsy Exclusive)
(Article source here)

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New financial year, new rules.

(July 1, 2017)

The start of the financial year is often the time we see new legislation take effect and this year is no exception.

Below we discuss changes that came into effect on 1 July 2017. The impact that these have on you will depend on your individual circumstances.

Please note: We have also included several other changes that were proposed to take effect from 1 July 2017; however, these changes are still only proposals and legislation needs to be passed to make them effective. Changes could be made or the proposals may be rejected.

Superannuation

Superannuation transfer balance cap
There is now a limit on how much superannuation you can transfer from accumulation phase to retirement pension phase. This is called the transfer balance cap.

The transfer balance cap limit is initially set at $1.6 million, however, it will indexed by CPI (rounded down to the nearest $100,000) – the indexation will only apply to the unused portion of your $1.6 million transfer balance cap.

The transfer balance cap affects you if:

  • You are currently receiving a retirement phase income stream that is close to or in excess of the $1.6 million transfer balance cap.
  • You intend to commence a retirement phase income stream after 1 July 2017.

Please note: Transition to retirement income streams are not assessed against the $1.6 million transfer balance cap.

Contributions cap limits and non-concessional contribution bring-forward rule
The concessional contributions cap limit has been reduced to $25,000 p.a. regardless of your age (e.g. Superannuation Guarantee, salary sacrifice, employer and personal tax deductible contributions). Due to this, it may be worthwhile revisiting your existing salary sacrificing to superannuation arrangements and other individual tax-deductible concessional contributions, to ensure you stay within the new concessional contributions cap limit.

The non-concessional contributions cap limit has been reduced to $100,000 p.a. (where you contribute to super after tax). Furthermore, the bring-forward rules still apply but reflect the reduced limit.

However, a new restriction also now applies to non-concessional contributions, namely, if you have a total superannuation balance equal to or over $1.6 million at the end of 30 June in the previous financial year, you are no longer able to make further non-concessional contributions.

Transition to retirement (TTR) pensions
The earnings from assets supporting new and existing transition to retirement pensions are no longer subject to an earnings tax exemption. Asset earnings are now taxed up to 15%, the same as if the monies were still in accumulation stage.

Self-managed superannuation
In the Government’s recent Budget they proposed that a limited recourse borrowing arrangement will be included in your total superannuation balance and transfer balance cap:

  1. The outstanding balance of a limited recourse borrowing arrangement will count towards your annual total superannuation balance. The Government is still considering its approach regarding this proposal.
  2. The repayment of the principal and interest of a limited recourse borrowing arrangement from your accumulation account will be a credit in your transfer balance account. This proposal recently passed through Parliament.
    • Please note: This change applies in relation to a limited recourse borrowing arrangement that arises under a contract entered into on or after 1 July 2017. Furthermore, refinancing a pre-1 July 2017 limited recourse loan may also remain exempt from this change if certain criteria are met.

Superannuation anti-detriment payments
Superannuation anti-detriment payments are no longer available as part of a superannuation death benefit payment. However, superannuation funds are still able to make anti-detriment payments until 30 June 2019 for those members who passed away on or before 1 July 2017.

Tax deductions for personal superannuation contributions
The 10% maximum earnings as employee test for claiming tax deductions for personal superannuation contributions has been removed. This means, you may be eligible to claim a tax deduction for personal superannuation contributions if you are under 75 years old. For people aged 65 to 74 years, they are required to meet the work test (having worked at least 40 hours during a consecutive 30-day period during the relevant financial year).

Spouse contributions tax offset
If you didn’t qualify for the Spouse Contributions Tax Offset last financial year, you may qualify this financial year.

The income level for eligibility of the full $540 Spouse Contributions Tax Offset has been increased from $10,800 to $37,000. Also, the cut-out income level for a partial Spouse Contributions Tax Offset has increased from $13,800 to $40,000.

It is important to note that other restrictions also apply moving forward. For example, your spouse must not:

  • Exceed their non-concessional contributions cap in the relevant financial year.
  • Have a total superannuation balance equal to or exceeding $1.6 million immediately before the start of the financial year in which the contribution was made.

Low income superannuation tax offset 
The Low Income Super Contribution (LISC) has been replaced by the Low Income Superannuation Tax Offset (LISTO); however, the rules governing the new tax offset remain consistent with the old measure.

Under these rules, if you have an adjusted taxable income of up to $37,000, you can expect to receive a refund into your superannuation account by the Government. The refund is calculated at 15% of your total concessional superannuation contributions for a financial year, capped at $500.

Government co-contributions
Moving forward, further criteria also needs to be met to be eligible for the Government Co-Contribution. For example, you must not:

  • Exceed your non-concessional contributions cap in the relevant financial year.
  • Have a total superannuation balance equal to or greater than $1.6 million on 30 June of the year before the relevant financial year.

High income earners (Division 293)
The income threshold regarding the extra contributions tax for high income earners has been lowered from $300,000 to $250,000. This means that if your income and concessional contributions exceed the $250,000 income threshold, an additional 15% tax on concessional contributions will apply.

Age Pension eligibility age

Depending on your birth date, the Age Pension eligibility age has increased from 65 years to 65.5 years.

Please see the below table for a summary of how this may affect you.

Age Pension Eligibility Age
Date of Commencement Eligibility Age Those Affected
– 65 years Born prior to July 1952
From 1 July 2017 65.5 years 1 July 1952 – 31 December 1953
From 1 July 2019 66 years 1 January 1954 – 30 June 1955
From 1 July 2021 66.5 years 1 July 1955 – 31 December 1956
From 1 July 2023 67 years On or after 1 January 1957

Financial assistance payments to eligible families

The Government’s Single Income Family Supplement to eligible households is no longer available to new applicants; however, if you were eligible on 30 June 2017 (and, continue to remain eligible) then you will continue to receive the Single Income Family Supplement.

Furthermore, the existing Family Tax Benefit payment rates will now remain unchanged at their current levels for the next two years; indexation will resume from 1 July 2019.

Prospective first home buyer

First Home Super Saver Scheme
Under the Government’s newly proposed First Home Super Saver Scheme, prospective first home buyers, may withdraw their voluntary contributions to superannuation to purchase their first home. From 1 July 2018 it is proposed that the amount available for withdrawal will be up to $15,000 of voluntary contributions per financial year since 1 July 2017 ($30,000 in total) plus deemed earnings, less tax on concessional (pre-tax) contributions and deemed earnings. Contributions under this scheme must be made within existing superannuation contribution caps. First home savers may wish to delay making additional contributions for the purpose of building a home deposit, as the measure is not yet legislated.

Stamp duty 
The NSW and VIC Government recently made announcements regarding stamp duty, which took effect on 1 July 2017. For example:

  • In New South Wales, first home buyers are now exempt from stamp duty on existing and new homes worth up to $650,000. In addition, existing and new homes between $650,000 and $800,000 also attract stamp duty discounts. Stamp duty charged on lenders’ mortgage insurance has also been waived.
  • In Victoria, first home buyers are to be exempt from stamp duty on existing and new homes with a ‘dutiable value’ (e.g. the price you pay minus any deductions) of $600,000 or less. In addition, existing and new homes with a dutiable value between $600,001 and $750,000 also attract stamp duty discounts.

Domestic investors

Tax deductions and residential property investors
If you are a residential property investor, the following measures have been proposed however not legislated:

  • You are no longer able to claim a tax deduction for travel expenses incurred whilst personally inspecting, maintaining or collecting rent for your residential rental property. However, property management fees paid to third parties (e.g. real estate agents) will remain tax deductible.
  • The Government has limited depreciation deductions on plant and equipment to outlays incurred by the current owner of a residential real estate property. However, grandfathering arrangements may apply to existing residential real estate properties as at 9 May 2017.

Moving forward

We suggest that you take the time to review these changes and consider how they may relate to you both now and in future.

If you are unsure about how these changes may affect you then please contact us.

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