You Won't Live Forever But Your FaceBook Posts Might
You won’t live forever but your posts on Facebook might!
Posts on Facebook, comments on YouTube and photos on Instagram will live on after death, raising estate planning considerations.
The number of Facebook accounts held by people who are dead could outnumber those of the living by 2060.
This is only going to become more pronounced as entire generations grow up using social media.
Ownership of digital assets is a difficult legal area, as legislation and the social media platforms have struggled to keep up with developments, but it
is nevertheless an area that should be considered in your estate planning.
Digital wallets such as PayPal can have amounts of money stored on them, internet domain names can have value and can sometimes be sold, and articles from
bloggers can even be a type of intellectual property,
For investors in bitcoin and other types of cryptocurrency such as ethereum or litecoin this can be an even bigger consideration.
A bank will put a stop on your account when informed by an executor and account assets are considered in the probate process.
This will not necessarily be the case for your digital assets.
We should factor our digital assets into our estate plan, with instructions on the location and access of these assets.
Estate lawyers can advise you on the best process.
Plan for a memorable wedding day, not a memorable wedding bill
According to the latest Easy Weddings wedding planning survey, the average cost for Australians to get married is $30,000.
No doubt there is a large range of budgets for couples on their special day, but undoubtedly it is a big commitment financially as well as personally.
Still, for many it is the most important day of their lives and should be a memorable one. This doesn’t necessarily mean you need to put yourself in debt
or sacrifice your savings.
Here are some tips on how to look for major costs, what you might be able to compromise on, and hidden expenses you might not have thought of. Have a look
at the ‘Wedding Thrills minus the Endless Bills’ newsletter for more detail here:
Wedding Bills (149 KB)
Some things of mention which could have a sizable impact on your budget are: package deals, venue extras, overseas weddings, and taxes/service charges.
So how can you make your wedding more economical?
1.Wedding on a weekday?
2.Budget clothes – a non-traditional dress might be cheaper, perhaps hiring is better than buying outfits you and the bridal party will only wear once.
3.Looking/buying online –some research into wedding rings online before walking into the nearest jewellery
store could amount to a big saving.
4.Making your own decorations.
5.Keeping that guest list down – politely say you’re only having a small affair; who are you inviting out
So what does this all have to do with financial planning? Advice regarding budgeting, saving and creating wealth is something I can help you with.
For a no obligation chat at my cost, give me a call on 8299 9927 or email me at email@example.com
My Top 10 Tips for Building Wealth Sensibly
There are a lot of ‘rules’ for wealth floating around – especially after the New Year. I’ve read a few, and many of them are great. I thought I’d share
my personal “Top Tips” that I use towards building wealth sensibly.
This is general advice only – to know what works best for you I need to speak to you in person to take your individual circumstances and goals into
Online and On-Demand
In today’s world we are seeing more and more services move to the online environment. We can now order tickets, food, gadgets and other products that we
used to go to a physical shopfront for.
In addition to this we can book services online, and many will even offer a full service such as an online degree, online technical help, and even lodging
your tax return.
Some of the benefits of moving a business online can include cost savings in rent and staffing, flexibility in service and product delivery (for customers
who are far away), access outside of hours for people who work a 9-5 day, and efficiency of having it all in the one place. Let’s face it, when was the last time you visited a physical branch at your bank?
But what about those services where we value the human interaction? What does everyone think of self-service
checkouts at supermarkets? Would you want to talk to a lawyer or accountant via online chat?
Given that financial advice requires disclosing both personal and financial information, would you be willing to pay for financial advice online if it
were cheaper, and could it still be properly regulated and supervised?
It will be interesting to see how everything changes in the next decade.
Until then, I hope that my clients benefit from interacting with me in person as much as I enjoy talking to all of them.
Traditional Employment Is Changing, So What About Super?
According to the Association of Superannuation Funds of Australia (ASFA) there is a ‘gig economy’ trend arising, and it may significantly affect superannuation
The gig economy is where buyers and sellers of goods and services transact via the web (such as independent contractors or online sellers).
See a recent article by the ABC for a summary of the findings here.
The rise of the gig economy will see a shift towards more independent work arrangements where workers may not be covered by the Superannuation Guarantee
(SG). In the absence of any policy reforms, this will mean lower superannuation balances at retirement for those who receive their income from the likes of Uber, Deliveroo and eBay- or those who have a second job which they work sporadically.
Research by ASFA warned of "sham contracting", where employers mask an employment agreement as ‘independent contracting’ to evade paying the superannuation guarantee .
ASFA said: “Almost one-quarter of self-employed people have no superannuation” which is undoing many of
the protections Australia has worked so hard to achieve by current policies and laws.
Noting the issues, ASFA is pushing for the SG to remove the $450-a-month in pay threshold before employers are required to pay super, and to enforce employers
who “contract out” workers to start paying Australian employees the super that they are entitled to.
You might think retirement is too far away, however it is never to early to start planning. Even a small
amount extra will make a big difference over forty years. Talk to Katherine Hann on 08 8299 9927 about your super.
Effective Goal Setting
Have you thought about what you want from life? How much time have you spent thinking about it? Have you actually set yourself a plan to how you will get
A key barrier to achieving goals is the inability to map it out in clear steps. Some other reasons are a lack of belief, a lack of confidence, unrealistic
timeframes, and fear of failure.
So here are some tips that you can take to get on track:
Create your big picture and work from there.
So you have an over-arching but vague plan of “work life balance” – that’s great but you’ll need to meet a few smaller targets to get there. How about
“I need stable working hours”, “I need a flexible employer”, “I need to organise my time better”?
Be specific with the goals you are setting.
These should be measurable, and defined. Determine what you want. This seems pretty obvious but are you sure you know what you need, or are you constantly
changing your mind? Does the plan seem to change once you start?
Challenge yourself but be realistic.
An easy goal doesn’t give you much reward, but an impossible goal gives you even less. Set them in relation to your own ability and past achievements,
that way you won’t feel frustrated and give up.
Instead of “I need to make less mistakes” or “I want to get rid of my winter weight” try thinking about what you need to do and what you would like to have at the end.
Have a strategy, and commit to it.
An athlete might be trying to increase their performance, so a training plan with key requirements to do x activities on a certain number of days is vital.
Review, evaluate and update.
How is your performance going? Give yourself feedback. If it isn’t quite up to scratch, change your strategy and revise your goal. You can still get there
with a few little amendments.
Moving in Together - What About the Money?
So you and your partner have decided to take that next step in your relationship and move in together.
I’m sure you’ve had your fill of advice from family and friends (and of course the internet) on the do’s and don’ts when getting settled in together.
From this time on, it is important to look at your relationship from an emotional perspective AND a
Money issues are often a cause of separation for couples. It is important to communicate early and figure out what works best for both of you.
Instead of simply telling you what to do, I’d like to share some examples of how couples have effectively shared their expenses.
Have a look through the link here and think about what approaches you can take.
Do you agree with these, or are there any other ideas you might have? What did you do when you first moved in with your significant other? I’d love to hear from you.
Are Young People Being Priced Out of The Property Market?
We’ve been seeing a slew of media reports about the soaring house prices Australia-wide, and we’ve certainly heard a lot of talk about ‘bubbles’ and ‘entitlement’.
Our government is working at applying more pressure to financial lending practices for investors- which tells us they’ve seen the problem too.
But is the situation really as bad as it sounds, or are we just too focused on hotspot areas around Sydney and Melbourne?
The March residential prices from the ABS (found here)
give us a better idea of what is really going on. Investor activity has caused a boom in certain pockets around Australia.
Perhaps you’ve heard something about your state becoming an investor haven, but where? If you’re looking near the CBD or a trendy suburb then
this may be your cause for worry.
While property prices from March 2016-March 2017 have increased by 14.4% in Sydney, they have decreased by 5.9% in Darwin, and Adelaide has only seen a
Yes it’s true that the proportion of owner-occupier loans to First Home Buyers was at 13% in February, which is a small comparison to the proportion of
loans to investors sitting at 50%.
This does mean it is harder for those just starting out- but doesn’t mean it is impossible.
It is important to focus on what you can do, not what you can’t control.
If you’d like some help with selecting investments or budgeting, I can help you get there, so don’t hesitate to give me a call or send me an e-mail and
we can arrange a no-obligation meeting to discuss your financial goals.
Where Should Generation Y's Actually Put Their Cash?
Let us put the avocado references aside for once, what should Generation Y's be doing with their money?
ABC asked some experts, and their response can be found here.
It might sound confusing or even a bit overwhelming, and that is why you need the help of an expert to guide you.
So call Katherine Hann today on 8299 9927 or e-mail firstname.lastname@example.org for a free, no-obligation appointment.
4 Ways To Prevent Fights About Money With Your Partner
4 Ways to prevent fights about money with your partner
My Mum used to say to me while I was growing up that couples only ever fought about two things: sex and money. Here are some tips about the money side of things I have learnt through being a financial adviser and through life experience:
1) Be honest
Let your partner know about your income, expenses, assets (those things you own) and your debt and ask the same of them.
2) Be Open
In many relationships, one partner can earn more money than the other and therefore cover more of the expenses. It might be that one of you is staying
home to look after children. Check with each other regularly that you are both still happy with how this is working.
3) Have ‘Fun’ money
As you’re setting your budgets and planning a financial future together, be sure to set a little aside for yourself each pay. This could be to go out with
friends or treat yourself to something that makes you happy. This ensures that both partners feel that they’ve maintained some independence when it
comes to their own financial situation.
4) Create a shared financial vision and plan
Not enough people have any sort of plan in place when it comes to their own finances. You have committed to a relationship, and money becomes a significant
part of that. Sit down with a financial adviser and start mapping out your financial plan.
Contact Katherine Hann on (08) 8299 9927 for a no obligation first appointment.
How to help your Gen Y's understand money
How to help your Gen Y’s understand money
As many of you may know Gen Y's (that is our adult children) are staying at home longer and their Baby Boomer parents (us!) are having to pay for it.
A lot of the time this makes financial sense – as long as the child is contributing and paying their own way (or at least some of it). However, even
though we know it is sometimes best to so NO! to our children, it is often the hardest thing to do.
What we are actually doing is teaching them to be dependent on us instead of self-sufficient, so what can we do to help them? Here are some tips to
help you get you started:
1. Be clear about how much money you will provide-set limits on what you are giving and agree on what it is for. Work with your children
to establish a budget by reviewing essential living expenses and debts.
2. Organise a monthly money review-regular money meetings keep your child accountable, but they can also be motivational, especially
if they realise the gains made toward reducing expenses, paying debt or savings for something special.
3. Loan money like the banks-If you’re planning on lending your child money, make it official with a written agreement. Outline a
repayment plan along with a deadline so your child knows to take your money seriously.
5. Charge rent if your child is living at home- I didn’t want to do this either as it was such a tough conversation to have but my
daughter must have seen it coming because she was ok with it by the time the conversation came around. Your children are probably already talking about
this with their friends and expect it.
6. Teach smart tracking-After years of scraping by and eating two-minute noodles, many Gen Ys fall into the trap of spending all of
their income or more when they begin earning a regular salary. This can cause more debt and stress than they or you want. Help them find and install
apps that will track and understand their spending and saving habits.
If you really want to help you children start on the path to financial success,
it is never too early for them to see a financial planner. My Gen Y children refer their friends to me-you can too!
Women and Super-bridging the gap
Women and super – bridging the gap
Did you know that the average super balance for men in the work force age between 58 and 62 years is approximately $210,000 and for women that balance is $95,000?
Only a small proportion of retired women live on incomes above $50,000 and more than half have incomes of less than $30,000, while 77% of women rely on some form of Age Pension in retirement.*
Scary, isn’t it! Below are some of the reasons why:
• Part-time work: if women decide to have children they generally work part- time for some of their career. This can be anywhere up to 20 years which leads to significantly less money contributed to super compared with men.
• Gender pay gap: the difference in average weekly pay packets between men and women has risen to its highest level yet of 18.2%. This gender gap effectively translates to women working five days but only being paid for four.
• Starting a family: when women decide to take a break to have kids it can often extend from the 12 month maternity leave to up 5 years, once the kids start school, this generally means no contributions to super.
• Small business owners: once they have children, some women choose to start their own small business to create more flexibility. As self-employed individuals they will no longer receive the 9.5% employer contributions to super.
• Elderly parents: women are significantly more likely to take time off to care for elderly parents or relatives.
So what can women do to help themselves to a comfortable retirement?
• Determine your financial goals and objectives and have a plan to educate yourself and make the best or your money.
• Start planning early by making extra contributions into super before tax (salary sacrifice).
• Take advantage of the government co-contribution by making after tax contributions to your super.
• Simplify your super by rolling all your super accounts into one. Consolidating your accounts and/or tracking down your lost or unclaimed super could save you thousands of dollars in unnecessary super fund administration fees.
Super will probably be your biggest asset outside your home. Getting personal advice can make a really positive impact on your retirement well-being.
So sit down with a trusted Financial Adviser, like Katherine Hann, identify all your super accounts, check your balances, work out what you'll need to retire on, calculate the gap, and then find out if there is anything you can afford to do to help bridge the gap.
Call Katherine for a no obligation first appointment on 08 8299 9927.
*Source: Australian Institute of Superannuation Trustees, Super-poor but surviving: experiences of Australian Women in Retirement, 2011
I recently sat down and had a chat with a young woman who had just started her first job after university. This is a very smart, highly educated and professional woman in a well paid role.
She wanted to know what she had to do about her super and what her choices were. I started to speak with her about asset classes and realised that she didn't understand what I was saying.
It was not that she couldn't understand but that nobody had ever shown her. Below is a very simplified list of what the asset classes are in what I think of as plain language,
Cash-this is similar to the money in your bank account such as a higher saver account or a term deposit.
Fixed Interest-think of this as you lending money to the government (government bonds), they will pay you an amount to invest in the country.
Australian Shares-this is reasonably straight forward, think of buying Telstra, Commonwealth Bank or BHP shares.
International Shares-think of investing in Microsoft, MacDonald's or Target.
Property-this is not the same as buying your own home or an investment property but your share in commercial property such as a bridge, high rise building or warehouse.
You can invest in all or some combinations of these in your superannuation fund depending on how comfortable you are with the risk involved.
I hope this helps you understand your super a little more.
Are bank accounts like shoes?
I promised to show you how to organise those 3 bank accounts and I wanted you to be able to relate this to something we all love.
Think about those 3 bank accounts like shoes, yes shoes!
So how do you organise your shoe cupboard? Or in this case your bank accounts?
1. Your every day bank account are your favourite pair of boots, you can use them every day, they are comfortable, durable and you know they will last forever.
All of your salary or wage is deposited into this account. It will not pay a high interest but it won't cost you much to run.
2. Your bills account are your favourite pair of court shoes, you can wear them to work or out to dinner and they are reliable;
you know exactly how they feel and they are there whenever you need them.
You need to work out what your regular bills are and how often you need to pay them.
The MoneySmart website has a fantastic budget calculator using an excel spread sheet.
It is easy to use and thinks of things you spend your money on that you may not have thought of yourself.
Work out your yearly bills and divide them by 26, put this money by automatic transfer into your bills account every fortnight when you get paid.
Here is the link, or you can find it on my resources page:
3. Finally, your savings account is your favourite pair of sparkly, high heel shoes that you wear to that special event.
You don't wear them often, sometimes they are uncomfortable but they give you exactly the look you want.
Remember that you want that new car! Pay yourself in savings first (again you can organise an automatic transfer with your bank).
Transfer between 5% and 10% of your salary to your savings account each fortnight.
If you are on a salary of $50,000 per annum, this will be $159 per fortnight.
If you can afford more, fantastic, you will reach your goal even faster!
Yes Virginia, you really can have a convertible
Ok, you might have had a part time job in high school, but let's face it, you probably spent all you had each week. You just had to have that outfit for Saturday night, petrol to go and see your friends or pay your phone bill.
Now you have your first full time job and you have all this money you never had before - but where did it all go?
Here are some simple things to do to keep track and maybe even save for something important to you.
Yes Virginia - you really can have that car!
- Know what you get paid each week or fortnight - that is your income.
- Check your payslip against what goes into the bank - remember that your payroll department will take out taxation and superannuation payments.
- You may know how to use internet banking and find it easy but if you don't, learn how. Your bank will teach you!
- Set up 2 more savings accounts so that you have 3 accounts in total - it shouldn't cost you anything and if it does - change banks.
What do you need 3 savings accounts for?
- General account - this is the one your pay goes into
- Bills account - this is where you put money away to pay for those bills you know are coming
- Savings - this is where the money will come from for that car!
Next time, I will talk about how to work out what to put away in each account, so stay tuned and you will get better about understanding your own money. It is called Financial Literacy and you can do it!