Top Five Places in Australia to Buy Your First Home

Home prices in Australia have been rising for years now, with many homebuyers being priced out of the market in places like Sydney and Melbourne where the average home price is $852,000 and $641,200 respectively. If demand continues to exceed supply as the populations of Aussie urban hotspots swell, experts predict that property will be virtually unaffordable in the future. If the next two decades see the same remarkable increases of the last 20 years, by 2037 it will cost $6 million to enter the market in both Sydney and Melbourne.

While this growth can only last for so long, with buyers having to pay 8, 10, and 12 times their annual income for a home, in some cities at least, demand is still dwarfing supply. This means the bubble isn’t going to burst tomorrow. This is partially due to the Australian real estate market’s unique characteristics – the persistent low interest rates, interest from international investors, and restrictions on development in some areas.

When it does burst, property values will drop, possibly dramatically in the cities with highly inflated prices. This could spell trouble for you if you want to sell your home before the market rises again, as you may not be able to get the price you purchased it for.

What if you want to buy a home right now? Where are the best places in Australia to purchase a first home? Where can you find that perfect balance of current affordability, a great quality of life and ample job opportunities – and feel secure that you aren’t paying a hyperinflated price for your home?


Perth
In Western Australia, the economy has been growing at a much slower rate than New South Wales, Queensland, and Victoria. This has pushed housing and rental rates down, making Perth one of the most affordable cities in Australia. While some suburbs, such as Peppermint Grove, experienced fast growth in 2016, for the most part 2017 is expected to provide plenty of opportunities for buyers.

Perth is also an excellent place to call home – it was rated as the 21st best city to live in the world in terms of quality of life, safety, and health and environmental standards. The area is known for its beautiful beaches, award-winning wine regions, and ultra low rates of crime and homelessness. The capital of WA and a bustling city of two million, there are plenty of job opportunities in education, healthcare, retail, and the service sector to accommodate the large population.

Darwin
Darwin, like Perth, has experienced something of a slowdown in response to the flattening mining industry. This means that, right now, the housing prices are at a low, making this a great city to invest in. While the capital of the Northern Territory is far from other major cities, it is close to Australia’s Southeast Asian neighbours, which is why Darwin is a wonderfully multicultural city. You’ve got lovely beaches, plenty of sunshine, low unemployment, and outdoor activities abound. The downsides are, however, high food prices and Darwin isn’t as rich in the arts as cities like Melbourne and Sydney.

Hobart
One of the best places to buy a first home in Australia isn’t on the mainland at all, but on Tasmania. Hobart, traditionally has had a weaker economy than other cities, but recently the city has been growing. Also, excellent first-home buyer grants have boosted industries like construction and tourism, fuelling the economy and helping to keep prices dramatically lower than other cities.

Hobart is a top pick in terms of affordability and if you want a property where your home value is likely to go up, not down. It’s also an ideal spot for a safe, laid-back way of life and for raising a family. The city boasts good schools and plenty of outdoor and cultural activities.

Liverpool
Not far from Sydney’s CBD, Liverpool is a suburb where you can buy a home for an affordable price, while also being close to great amenities, employment, and transportation. Many real estate experts recommend opting for the inner-city suburbs around Sydney if you are interested in capital growth and access to everything that Sydney provides. Liverpool, as well as Casula, Blacktown and St Marys are all good picks.

Mawson Lakes
Outside of Adelaide in South Australia, you will find this gem. Prices are rising, but new homebuyers can still find some excellent deals. The area is known for being safe, clean, and offers a relaxing atmosphere, although a limited nightlife. Close to Adelaide, job prospects are strong, with many people professionals and students living in the area.

With fast-rising housing prices, it can be a challenge deciding where exactly to purchase your first home in Australia. Still, there are so many excellent opportunities, from the Northwest Territory to Tasmania. You may not be able to buy in Sydney, but that doesn’t mean you can’t get a great deal just outside of the city, or venture to the growing, thriving other corners the country – where you’ll enjoy beautiful beaches and outdoor activities, and escape the high prices and the crowds!

 
(Feedsy Exclusive)
(Article source here)

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5 things small business owners can do to prepare for retirement

FIVE THINGS SMALL BUSINESS OWNERS CAN DO TO PREPARE FOR RETIREMENT

1. Start paying yourself superannuation each year and make regular top up concessional contributions if possible.

2. Consider investing in property or shares so you can access your money if you need it, rather it being locked away in super.

3. Regularly review your investments, and seek advice on whether self-managed super is the best option.

4. The calculator on The Association of Superannuation Funds of Australia website can give you a general idea about how much you will need to achieve the lifestyle you want in retirement.

5. Ensure you work ON your business rather than IN your business, so you can build your brand and client base for when it comes time to sell.

Planning for retirement is often back of mind for small business owners focused on keeping their ship afloat.

You’re not alone if you decide to plough excess money back into your business, especially in its infancy, and thinking you will get a retirement plan together one day soon.

The reality is, one day can roll around sooner than you think.


A recent survey of the owners of around 300 small and medium businesses found more than 40 per cent don’t have a plan to fund their retirement.

Less than half were confident they could afford the lifestyle they want in retirement, according to the research conducted last September by Empirica Research for accounting firm Bentleys.

Financial planner Steve Greatrex, from Wealth On Track, says failing to put money into superannuation is the biggest mistake small business owners make, particularly when getting their venture off the ground.

“In many cases they just don’t think of it and if they do they just don’t have the money,” he says.

“It becomes like a bad habit, it’s like you stop going to the gym and then you never go back again.”

Mr Greatrex says it’s a good idea for business owners to pay themselves 9.5 per cent superannuation, just as they are obliged to by law for any employees.

Like regular workers, small business owners can also make regular top up concessional superannuation contributions.

Concessional superannuation contributions are capped at $30,000 for under-50s, which will be cut to $25,000 from July 1, 2017. The cap is a little higher for over 50s at $35,000 but this will also be slashed to $25,000. The maximum tax rate on superannuation is 15 per cent.

Complete Commerce director Brett Wood says he often recommends small business owners invest in assets in their own name, like shares or investment property, rather than tying up that cash in superannuation when they are starting out.

He says it’s important to regularly check in on your investments as your own personal and broader economic circumstances change to ensure you are on track to reach your goals.

“People tend to get a plan, be happy with a plan and then forget to monitor it as they go,” Mr Wood says.

He says small business owners need to build systems and have people in place so they can eventually work on, rather than in, their business.

“If you actually step back from it while they do the core work and you are just sourcing business … then that gives you a chance to sell,” Mr Wood says.

“It doesn’t always work but that’s is always the plan.”

 
(Source: Melissa Jenkins, Australian Associated Press)
(Article source here)

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Are you thinking about retiring this year?

If you are planning to retire in 2017, you may be thinking about the tax you will have to pay on your retirement fund. There is nothing to worry about here; take a look at our guide below and understand how tax affects your retirement.

Lump Sum Payments at the End of Employment
If you are reaching the end of your working life, you and your employer will be focused on tying up loose ends and ensuring that all due payments are present and correct. These can include termination payments if your term of employment ends before your contract is complete, and unused holiday lump sums.

The Australian Tax Office will take these payments into account, however they will be taxed at a lower level than your standard income. You will receive a statement from your employer detailing whether this payment is Lump Sum A or Lump Sum B, and this must be recorded on your tax return.

Redundancy Payment
Redundancy payments below a certain amount are not taxable under Australian law. This amount is calculated based on the number of years you have spent in employment. Any redundancy payments received above this amount will have tax applied to them.

Early Retirement Tax
If you have been offered early retirement from your job, you may be worried about how this will increase the financial burden of your retirement years. In order to offset this burden, the ATO can assess your early retirement scheme and decide if you qualify for reduced rate tax.

Capital Gains Tax Issues
Of course, not everyone who is heading towards retirement is an employee. If you are a business owner, or own other professional assets that you will not require in retirement, you will probably want to sell them on.

The profit you make from this sale is likely to fall under the jurisdiction of capital gains tax. However, providing that the assets are business and not personal assets, you may qualify for an exemption, up to a limit of $500,000. Above this amount, tax will apply.

Tax on Superannuation Funds
In most cases, if you are drawing money from a superannuation fund on retirement, this will be tax free. However, this cannot always be relied upon. For example, if you are aged between 55 and 59, a component of your super fund withdrawal will be added to your total taxable income.

This will be taxable at the marginal tax rate, with an offset applied.

It is also important to check what type of super fund you have. If, like most supers, it is a taxed fund, you will not have to pay any tax on the benefits you withdraw from it. However, if tax has not yet been paid on the fund, this may be applied to the benefits withdrawn.

General advice warning: Any advice contained in these pages is of a general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regard to those matters and consult your accountant and or financial planner.

 

(Source: Feedsy Exclusive, Published on March 2, 2017)
(Article source here)

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Reno Rookies: Watch Out for These 5 Renovation Pitfalls

Spatula? Check!
Grout? Check!
Know how to tile? Well, I did see this one video on YouTube…

Many of us are trigger-happy when it comes to starting renovations. Feeling excited, we’re so fired-up about our special projects that, just like a kid waiting for Xmas, we find it impossible to wait, jumping in before we’ve actually thought everything through.

Better hold onto your horses folks! This is one of those times in life where we have to exercise some restraint. Jumping the gun here can lead to some serious – and expensive – problems down the track (such as having to call a professional to re-do that tiling?).

To keep you focused, here are the 5 biggest pitfalls and problems you need to watch out for when renovating your home.


1. Wonky Priorities
It’s easy to get distracted by all those fancy paint swatches when you waltz into your nearest home & garden shop, but should you really be debating between a blue or yellow-based whitewash for the living room, or be fixing that leaky toilet?

Make a list of things that need doing “Urgently” and a second list of things that would be “Nice to do”. Tackle your “Urgent” list first. They might not be the most fun parts of your reno, but it’ll make your house immediately liveable.


2. Not the Right Kind of Help
So what if your neighbour’s son-in-law was an apprentice carpenter for 6 months back in the ’90s? That doesn’t mean he (or your neighbour) is the right person to answer your wood-based queries!

Ask your work colleagues and close family members if they can recommend someone, or hunt through search engine listings to find businesses with great feedback ratings. Don’t get stuck with someone inexperienced, unskilled, or worse – unqualified – for the job at hand.


3. Lack of Communication
Humans the world over are united in their hatred of having someone breathe down the back of their neck while they’re working. So if you’re feeling the need to do so, then you’re probably not communicating well with your partner/tradie/architect/interior designer.

Establish open lines of communication right from the start. Be in touch with your contractors once a day to follow up on progress, or have instructions clearly defined so everyone can get their jobs done with minimum distraction.


4. Breaking the Bank
Budgets can blow out oh so easily during even the most meticulously-planned renovation. When planning your budget, prepare your action plan in advance in case you head for (or hit) the red. Will you fire the tradies and pick up the paintbrush yourself? Or will you pause everything until the cash flow returns? Make your decisions now to avoid getting stuck later on.


5. Unrealistic Time Frames
With that rush of adrenalin as those first strips of wallpaper are pulled off, you might think, “This is a breeze! We’ll be done by January!” Don’t fool yourself. Not only do unexpected life events crop up, but you might suddenly find that – underneath all that wallpaper – lies a totally outdated electrical system that urgently needs replacing.

Give your renovation calendar plenty of wiggle room so you won’t get stranded while waiting to move in – or worse – have to move in while the job’s only half done.

What do you think of our list? Is there anything you’d add to it, or do you think we’ve covered all the bases? Share your thoughts with us!

(Source: Feedsy Exclusive)
(Article source here)

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Chocolate may prevent irregular heart beat

Moderate consumption of chocolate has been linked to a lower risk of developing atrial fibrillation (AF), an irregular heart rhythm that can lead to stroke if untreated.

Research published in the journal Heart found the rate of AF was lower for people consuming chocolate regularly, compared with individuals reporting chocolate intake less than one 30 gram serve per month, with similar results for men and women.

The association was found to be strongest when women consumed one weekly serving of chocolate and between two to six servings for men.

AF is the most common cardiac rhythm disorder in clinical practice and is independently associated with an increased risk of stroke, heart failure and death.

Symptoms include heart palpitations, fatigue and shortness of breath or breathlessness.

Researchers at Harvard TH Chan School of Public Health and the Duke University Medical Centre analysed data from more than 55,000 participants, aged between 50 and 64, from the population-based Danish Diet, Cancer and Health Study.

Participants provided information on their usual weekly chocolate consumption, with one serving classified as 30 grams, but weren’t asked to specify which type of chocolate they ate.

Information on heart disease risk factors, diet, and lifestyle – roughly one in three smoked – was obtained when the participants were recruited to the study.

Their health was then tracked using national registry data on episodes of hospital treatment and deaths.

During the monitoring period, which averaged 13.5 years, 3346 new cases of atrial fibrillation were diagnosed.

After accounting for other factors related to heart disease, the newly diagnosed atrial fibrillation rate was 10 per cent lower for 1-3 servings of chocolate a month than it was for less than one serving a month.

The risk of AF was 17 per cent lower for one weekly serving; 20 per cent lower for two to six weekly servings; and 14 per cent lower for one or more daily servings.

“Despite the fact that most of the chocolate consumed in our sample probably contained relatively low concentrations of the potentially protective ingredients, we still observed a robust statistically significant association,” the authors wrote.

While no firm conclusions can be made about the cause for the association, the authors suggest that “dark chocolate may be a healthy snack option” that helps to prevent the development of AF.

However, doctors from the Duke Centre for Atrial Fibrillation in North Carolina have urged caution, highlighting that the chocolate eaters in the study were healthier and more highly educated – factors associated with better general health – which might have influenced the findings.

(Source: Sarah Wiedersehn; Australian Associated Press)
(Article source here)

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Millennials urged to cook for good health

 

Australia’s younger generation of foodies need to get out of the cafe and back in the kitchen if they want to keep their weight in check.

A survey commissioned by the Dietitians Association of Australia has found the nation’s cafe culture is entrenched in young adults.

Three quarters of those aged 18-34 eat out or order take-away food at least once a week, and 28 per cent dine out or order in at least three times a week.

That’s significantly more than their parents.

According to the survey, 43 per cent of 50-64-year-olds eat out at least once a week and just 10 per cent dine out regularly.

While eating out is convenient it can be bad for the waistline because of the large portion sizes.

Research shows that people who cook at home eat smaller portions and take in fewer kilojoules, as well as less saturated fat, salt and sugar, resulting in a healthier weight.

DAA spokesman Themis Chryssidis says foodies need to discover the joys of home cooking.

“Why not impress your friends and family by trying your hand at recreating your favourite cafe or restaurant dish at home?”Mr Chryssidis asked.

“Eating is just as much about enjoying food as it is about nourishing our bodies, so it’s great that young Australians are a generation of foodies. We want this love of food to play out in the home kitchen too,” he said.
(Sarah Wiedersehn; Australian Associated Press)
(Article source here)

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How do you compare to other renters?

 

Fears about potential eviction, blacklisting, and rent hikes are stopping one-in-seven Australian tenants from making complaints about or requesting repairs on rental properties.

A report by affordable housing, tenant and consumer groups says there’s an “entrenched culture of fear among renters” and that the significant power imbalance between landlords and tenants must be addressed.

Half of more than 1000 renters surveyed say they are worried that a repair request or complaint could land them on the blacklisted tenancy database, while 14 per cent decide not to risk it, the National Association of Tenants’ Organisations, National Shelter and Choice found.

“People are reluctant to complain to agents or landlords because they’re worried about rent increases or eviction,” a National Association of Tenants Orgnisations’ spokesperson said.

“It’s hard to imagine a product or service this poor in any other sector.”

Almost a quarter waited more than a week to hear back about an urgent repair request and 11 per cent copped a rent hike after asking.

“Affordability is extremely important to renters but it can’t be addressed without also looking at the quality and security of housing,” National Shelter executive officer Adrian Pisarski said.

Every second person surveyed for Unsettled: Life in Australia’s private rental market said they experienced discrimination when applying for a rental, usually over their age or the fact that they received government payments, or because they had young children, pets or were a single parent.

Of the renters surveyed, five per cent felt discriminated against them because of a disability.

“Rachel” – who did not want to use her real name for privacy reasons – fears she is often discriminated against and put in a “too hard basket” by many Melbourne landlords because she has multiple sclerosis and can’t live in a flat or somewhere with too many stairs.

“When we go and have a look at a house, because I can’t get around without my walking stick, I have to say ‘I just use it to balance. I don’t need wall rails or anything like that’,” the 35-year-old told AAP.

“If it looks like there’s going to be a need for any addition to be put in place, we’re not going to get the property.

“I basically had to lie about myself and say ‘my disability isn’t that bad, don’t worry about it’.”

The report calls for a national plan to boost housing supply, particularly affordable housing, and address renter’s security, rights and amenity.

HOW DO YOU COMPARE TO OTHER RENTERS?

* 83 percent have no fixed-term lease or it’s less a than 12-months long

* 53 percent of renters pay between $201 and $400/wk

* Almost half of renters in metro areas pay more than $301/wk

* The median rent price is Sydney and Melbourne is $480/wk

* 21 percent wait at least a week to hear back about urgent repairs

* 11 percent had a rent hike after asking for repairs

* 14 percent are too scared to complain about something or ask for repairs

* Half feel they’re discriminated against in rental applications.

(Source: Unsettled: Life in Australia’s private rental market)
(Article source here)

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Getting Your Estate in Order: A (Real Life) Cautionary Tale

If you’ve been married 2+ times, or have kids with 2+ partners, it’s important to leave sensible & sensitive instructions for distributing your estate. Here’s why.

s640q75As a life insurance adviser, I’m often involved with the families of clients who have passed away.

Over the years, I’ve seen many tragic or troubling experiences that could have been avoided if the person who passed on had been more careful with distributing their assets in their Will. This is especially the case when the deceased was married (or in a de-facto relationship) more than once, or has had children with more than one partner.

If that describes your situation, then consider this real life story as a cautionary tale when you leave instructions in your Will for distributing your assets after you pass away.

The Problem

Some time ago, a client whose father had passed away got in contact with me.

Obviously, they were very upset about the passing of their dad. However, the emotional turmoil for my client and their siblings was amplified because of concerns about their father’s Will.

The father had been married twice, and was living with his second wife when he died. The home they lived in was still mortgaged, and his wife was hoping to get the proceeds from his superannuation insurance to pay off the house.

The children, including my client, were from his first marriage. They were concerned that they may not have been remembered in their father’s Will.

Complications

As it turned out, the children had nothing to worry about. Their father had completed a binding death nomination for his superannuation in favour of his children, and so the proceeds from his superannuation insurance policy were going to go to his kids.

While this was good news for the kids, their stepmother was now in a position where she may not be able to continue to pay the mortgage on her home, meaning it may need to be sold before it was repossessed by the bank.

As you can imagine, it wasn’t a great scenario. Especially for ongoing, amicable family relationships between the man’s children, and his widow.

Protecting Your Legacy

This situation wasn’t inevitable.

If the father had sought professional advice about the appropriate personal risk protection plan for his complicated circumstances, a solution could have been designed that would have been fair to his children, and to his second wife.

If your family situation is similarly complicated, then I urge you to seek professional advice now to avoid leaving a legacy of heartache and family strain in the future.

If you would like to learn more about how you can best to treat all family members fairly, please contact me at K2 Wealth on (07) 3368 2002.

 

Any advice contained in this article is of a general nature only and does not take into account your circumstances or needs. You must decide if this information is suitable to your personal situation or seek advice.

F.G.P. Pty Ltd T/A K2 Wealth ACN 121 446 204 is a Corporate Authorised Representative (No. 314978) of Clearview Financial Advice Pty Limited ABN 89 133 593 012 AFS Licence No. 331367

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Making a Life, TPD, Trauma, or Income Protection Claim

Insurance is designed to protect you (and often your loved ones) when something negative and unexpected happens.

s640q75It’s a bit of a cliché, but the best insurance is one you never have to make a claim on.

Insurance is designed to protect you (and often your loved ones) when something negative and unexpected happens. In the case of life insurance products, it’s usually designed to cover you for unexpected accidents, disasters, and other losses.

Never making a claim on your life insurances means that you never experience any of these untoward events. And I don’t think any of us would complain about that!

However, if something does go wrong, and you experience a loss or other circumstance that’s covered by your insurance policy, then the good news is that you’ll be able to make a claim. This article discusses – in general terms – how you should go about doing that.

Minimising Stress

If you’ve just experienced a trauma or the loss of a loved one, or if you’re currently sick or injured, then chances are you’re already experiencing a great deal of stress.

That’s one of the reasons you’ll often hear advice about getting insurance through a financial advisor. If you take out insurance with an advisor, then when it comes time to make a claim, they’ll be able to guide and assist you through the process. They may even advocate for you if the insurance company is trying to avoid paying. This added support from a financial advisor is designed to minimise any additional stress during an already stressful time.

Keeping Loved Ones “In The Loop”

In the case of term life insurance (often just called “life insurance”), or in situations where you’ve been incapacitated, your loved ones may need to make an insurance claim on your behalf. To do so, they’ll need to know who your insurer is, and/or who your financial planner is. Do your loved ones know that information?

Claiming Through Your Advisor

In my experience, the following steps help to ensure that making an insurance claim will be as easy as possible:

  • Contact your financial advisor as soon as practical after the event occurs
  • Organise any documentation or other information that may be required, such as medical evidence, doctors’ reports, your ID, a death certificate, and financial evidence for income protection (this is by no means an exhaustive list, so talk to your financial planner to discuss what you need to provide)
  • Keep your paperwork together so it’s easy to access and use
  • Don’t be afraid to ask questions – after all, your financial advisor is there to help you!

Every situation and circumstance is different, so I can’t stress the last point enough – talk to your financial planner and ask questions so you can discover exactly what you need to do.

Claiming Without a Financial Advisor

As discussed, taking out insurance through a financial advisor should make claims time much less stressful. They will help you make the claim, at no additional cost to you.

That said, if you have an insurance policy that you’ve taken out independently, you can of course still make a claim for the events and circumstances that your policy covers. Most financial advisors won’t be able to help you with your claim. However, if you need assistance with a claim, we’re happy to help, for a fee.

Any Questions?

If you have any specific questions about what we’ve discussed in this article, pleaseleave a note in the comments, or give K2 Wealth a call on (07) 3368 2002. We look forward to helping you better understand the insurance claims process.

 

Information current as at 26 March 2015
Any advice contained in this article is general in nature only. Before acting you should consider the appropriateness of the information with regard to your personal objectives, financial situation, and needs. You should read the relevant Product Disclosure Statement (PDS) and Policy Document before making any decision about a product. For personalised life insurance advice, contact K2 Wealth on (07) 3368 2002.

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