An introduction to managed funds

Managed funds may give you access to a broader range of investment types by pooling your money together with other investors. Find out how they work and if they’re for you. If you want to diversify your investment portfolio and spread potential risk within and across different asset classes, sectors and geographic markets, you may find you’re limited by the...

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Want to earn more and keep your Age Pension?

Many people continue, or even start, working once they’ve reached Age Pension age. This may be for social reasons, personal fulfilment or to maintain their standard of living. With the higher cost of living at the moment, even more pensioners are taking up work. But what does this mean if you’re receiving the Age Pension? The government’s Work Bonus means...

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The transfer balance cap – how does it work again?

In the 2016 Federal Budget, the Government introduced the transfer balance cap as part of a broader superannuation reform package. The transfer balance cap imposes a lifetime limit on the amount of superannuation that can be transferred into a tax free retirement pension account. While it may appear straightforward, understanding its nuances is essential for effective retirement planning. What is...

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Mortgage vs super: where should I put my extra money?

It’s a dilemma many of us face – are we better off directing extra money to our mortgage or super? As with most financial decisions, it’s not a one size fits all approach and here are some factors to consider in deciding what’s right for you. Key takeaways: There may be tax advantages when you contribute to super, especially if...

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Falling inflation – what does it mean for investors?

Key points Inflation is in retreat thanks to improved supply and cooling demand. A further fall is likely this year. Australian inflation remains relatively high – but this mainly reflects lags rather than a more inflation prone economy. Profit gouging or wages were not the cause of high inflation. The main risks relate to the conflict in the Middle East...

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Economic and market overview

A rally in the second half of the month helped global share markets generate solid gains in January, extending the rally from November and December. The latest indicators suggest economic conditions are holding up quite well in most regions, which augurs well for corporate earnings. With inflation still above central bank targets, investors pared back their expectations for interest rate...

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Australian household wealth

Australian household wealth Is high Australian household wealth a source of support for consumers? Key points Australia ranked as having one of the lowest rates of disposable income growth per capita amongst OECD countries in mid 2023. An increasing income tax burden and mortgage repayments have weighed on income growth, despite solid wages and salaries. But, household balance sheets in...

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As scams evolve, so can you

As scams continue to evolve, it’s important to stay on top of the latest information. Here are some tips for staying protected against some of the most common scams impacting Australians today and red flags to watch out for. What can you do to stay protected? Anyone can fall victim to a scam. As well as learning more about the...

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5 tips for managing your SMSF

Setting up your SMSF is just the beginning. Make sure you’re aware of your obligations as an SMSF trustee and get the most out of your fund with this quick guide. While the list of SMSF administrative tasks and responsibilities may seem daunting, it’s there for a good reason: to ensure your fund’s decisions protect your retirement savings and provide...

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Understanding market volatility

Many investors become concerned when volatility occurs in global financial markets – particularly about the impact on their superannuation and other investments. In times like these, it’s important to understand the causes of market movements and how to minimise your risk. Why do markets move so much? Markets are influenced by many things – industrial, economic, political and social factors...

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Three reasons to err on the side of optimism as an investor

Introduction The “news” as presented to us has always had a negative bend, but one could be forgiven for thinking that it’s become even more negative with constant stories of disasters, conflict, wrongdoing, grievance and loss. Consistent with this it seems that the worry list for investors is more threatening and confusing. This was an issue prior to coronavirus –...

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The importance of rebalancing

Investing is more than choosing different assets. It also involves managing your portfolio on an ongoing basis to achieve personal goals. Your starting point In the initial stages of constructing a portfolio of diverse investments, it is likely you will have made a deliberate decision about how much money to hold in different asset classes. For example*, you may decide...

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Super fund performance and unlisted assets

Differences in the returns of various super funds have primarily been driven by whether the funds are invested in unlisted or listed assets. Super fund returns are always in the spotlight around the end of the financial year. This is when funds publish their annual performance results and send statements to members, and when researchers publish tables comparing fund returns....

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Should you fix your home loan?

Key takeaways An understanding of the benefits of fixing your home loan, including payment stability, protection from rate hikes and certainty over long term financial planning. The potential drawbacks to consider when choosing to fix, such as missing out on rate drops, higher initial repayment rates and restrictions on the level of additional repayments. When contemplating home ownership or refinancing...

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Seven key charts for investors to keep an eye on

Introduction At the start of this year, we thought shares would have reasonable  returns albeit it wouldn’t be smooth sailing given ongoing issues around inflation, interest rates, the risk of recession and geopolitics. So far so good. This note updates seven key charts we see as critical for the investment outlook. Chart 1 – global business conditions PMIs A big...

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Seven key charts for investors to keep an eye on

Introduction At the start of this year, we thought shares would have reasonable  returns albeit it wouldn’t be smooth sailing given ongoing issues around inflation, interest rates, the risk of recession and geopolitics. So far so good. This note updates seven key charts we see as critical for the investment outlook. Chart 1 – global business conditions PMIs A big...

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Factor Investing explained

Global markets are made up of dozens of asset classes and millions of individual securities, making it challenging to understand what really matters for your portfolio. But there are a few important drivers that can help explain returns across asset classes – these are known as Factors. Factor investing, also commonly called “smart beta” has become prominent in recent years...

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Economic update

October was another difficult month for financial markets, partly reflecting an acceptance among investors that interest rates are likely to remain high for longer than was previously anticipated. Geopolitical risk ramped up too, following conflict in Israel and Palestine. Australian shares were down nearly 4% over the month and overseas stock markets closed lower too, not helped by a third...

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Term deposit vs savings account: what’s the difference?

Term deposits offer certainty and savings accounts offer flexibility. Here are some other common features and benefits of each. Putting your money into a savings account, or in the alternative, a term deposit, are two common methods of saving. Working out whether either of these options are right for you depends on your personal and financial circumstances, as well as...

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Your guide to gearing

There are a number of considerations when it comes to gearing, the investment assets you may choose to gear and the way you structure your debt. A gearing strategy can be set at three levels: Positive gearing - where income from the investment exceeds the interest payable on the loan. Neutral gearing - where income from the investment is equal...

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Understanding your investment options

Investing is full of jargon and technical terms that can make getting started or managing your investments seem intimidating. Here are some of the key terms to help you better understand the different options available to you. Common investing terms There are a few terms that you’ll see repeated when we’re talking about investing. Bonds – Bonds are a way...

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Some recent questions on Australian inflation Key points The Australian inflation rate peaked in the December quarter but has been slower to decline than some global peers. While interest rate rises are helping to reduce inflation (especially as discretionary consumer spending slows), rises in domestic energy prices, a tight rental market and a lagged pick up in wages have contributed...

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How to monitor carried forward concessional contributions

You may be eligible to make concessional contributions that are greater than the annual cap if you haven’t fully used your concessional cap in an earlier year. This could help you to save even more for retirement, while also managing tax. What are concessional contributions? There are a number of ways you can contribute to superannuation. Depending on certain factors,...

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How to help grow your money through compound interest

Earning interest on interest: learn how the power of compounding can send your savings rocketing. Key takeaways Compound interest enables you to earn interest on interest which is accumulated over time. The effect of compound interest becomes extremely powerful over a long timeframe as the amount of interest earned grows. Investing in your super is one of the most effective...

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Granny flat arrangements within the context of the gifting rules

There are special rules for granny flat arrangements that may prevent the deprivation rules from applying. However they must satisfy a range of requirements. Retirees wanting to downsize their home may consider the option of living in a granny flat or an extension to / spare room of a relative or friend's home. Money, the transfer of an asset or...

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Economic update

July was a relatively uneventful month in financial markets and volatility remained low. Generally speaking, risk assets continued to perform well despite a sharp increase in the oil price. In fact July was the best month for oil since January 2022. Inflation seems to be coming off the boil in most key regions, reducing the likelihood of significant further increases...

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Are you getting the Age Pension you’re entitled to?

If you receive the Age Pension, recent changes to means testing for retirees could put more money in your pocket. These changes impact the assessment of certain lifetime income streams that began on or after 1 July 2019 (including any that you take up now). Lifetime income streams There are two main types of lifetime income streams: lifetime superannuation pensions,...

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Where is the recession

Key points A progress report on inflation: Inflation appears to have peaked, led by improvements in core goods prices and rate sensitive sectors like housing. The policy focus has shifted to labour market normalisation where early signs of progress are emerging. Is a soft landing in sight? The Fed remains committed to doing “whatever it takes” to bring inflation to...

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Economic update May 2023 Investment markets were relatively calm in April, following a period of heightened volatility in March when banking failures in the US and Europe had shaken confidence. Most major share markets closed the month around 2% higher, extending gains in the calendar year to date. Overall there was increasing optimism that major economies might be able to...

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