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Future
In order to avoid any conflict of interests in regard to product
choice our Financial Planners work on a fee for service basis and do not
participate in any programs that reward increasing business volumes,
choosing rather to pass savings back to our clients to keep product fees
as low as possible. Recently we were advised of our eligibility for a cash
rebate that we are unable to return to Clients.
Rather than except this payment
the Financial Services team decided to choose a charity to support and
nominated the National Breast Cancer Foundation. The National Breast
Cancer Foundation is Australia's only national not-for-profit foundation
established to promote and support research Into every aspect of breast
cancer. Since being established in 1994, they have funded 160 research
projects and provided research equipment in every State and Territory, to
a total of $40 million.
Like many millions of Australians our business has been touched by breast
cancer and we are aware of the benefits that this research can provide. We
hope that our ongoing contributions can help the National Breast Cancer
Foundation with their ultimate goal of funding a cure for breast cancer.
David Page CFP®
- Senior Financial Planner
Market Update
The source of recent market volatility goes back to 2007 and the US
housing market when problems arising from defaults in the sub-prime
mortgage component of the US housing market spread to global asset markets
in the latter half of last year.
The ripple effect of those problems on the US and global economy is what's
behind the market conditions we've seen recently, with global share
markets falling as much as 25% in January on concerns that we're headed
for a global recession.
How the Australian market performs in the near-term will rest on the
underlying fundamentals, which from Phillips's perspective represent the
corporate profits and associated dividends paid to shareholders, and
whether or not a global slowdown will spill into the local economy and
undermine those fundamentals.
We think that question is yet to be answered, but economists are largely
expecting global growth this year to be positive and the Australian
economy to remain relatively robust despite this growing volatility.
This reinforces the importance of looking at the market over the long term
as the following two graphs highlight.
Rising market volatility has seen the Australian share market fall...
[S&P/ASX All Ordinaries Index - Six months to 31 January 2008]
...but it remains at elevated
levels over the long-term, up 118% over the last 10 years...
[S&P/ASX All Ordinaries Index - 10 years to 31January 2008]
Kevin Moore CFP®
- General Manager |
Salary Continuance
within Super
A recent tax determination by the ATO has made it more attractive to
hold Salary Continuance within your Superannuation Fund:
In the past we have shied away from recommending that you hold Salary
Continuance in Superannuation because of a limit of a 2 year benefit
period. The ATO have revisited this limitation and have agreed to enable a
full deduction for cover through to age 65. This is a good opportunity to
review your current insurance structure.
The advantages of owning salary continuance insurance through a superfund
include:
- Less Impact on cosh flow if the
premiums are deducted from superannuation savings.
- Premiums may be cheaper.
(Policy may be more restrictive).
The disadvantages of owning salary
continuance insurance through a super fund include:
- The superannuation rules for
satisfying a claim can be tougher than the insurer's policy rules.
- Premiums deducted from the
super fund will reduce the balance.
These changes have provided some
more flexibility In how you hold your Salary Continuance cover. We still
feel that the best place to hold this cover is outside Super because of
the stronger policies that are available but where cash flow is an issue
then this is an excellent option.
I firmly believe that all working Australians particularly those with
dependants and/or debt should have Salary Continuance cover. If this
change means that more people can afford cover then it is a good thing.
"Tax deductibility for Salary Continuance inside Super extended to polices
with benefit periods through to 65".
Gordon Elder CFP®
- Senior Financial Advisor
Family Financial Planning
At a recent Professional Development day some real life examples were
presented that reminded us of the need to not only consider the needs of
our Clients, but also look at the needs of the children of our Clients. In
the current world of high Interest rates, housing affordability problems
and Investment volatility the sooner debt reduction, savings and insurance
strategies can be put in place the better.
With this In mind we are offering free risk and strategy assessments for
relatives of our Clients. If we can offer nothing else we will point them
in the right direction.
Contact Details
Phone: (03) 8586 9333
Mary Direct: (03) 8586 9329
Email: info@phillipsfs.com.au
Website: www.phillipsfs.com.au
Address: 1236 Nepean Hwy
Cheltenham VIC 3192
Phillips Financial Services
FPA - FINANCIAL PLANNING ASSOCIATION of Australia Limited PRINCIPAL MEMBER
austbrokers - AN AUSTBROKER MEMBER
Disclaimer
This newsletter has been prepared based on information that is believed to
be accurate at the time of writing however investment or financial
decisions should not be made solely based on this Information without
obtaining advice specific to your circumstances. |
