2014-15 Federal Budget – 7 Things Working Families Need to Know

Budget Changes For Working Families

Budget Changes For Working Families

 

You’ve won some, you’ve lost some. The biggie here is the rise in the retirement age, which the government has been telegraphing for a while. Working an extra 3 to 5 years (depending on when you were born) is going to have a big impact on most people’s long term financial planning.

1. There will be a new Paid Parental Leave Scheme.

2. Some child benefits will be discontinued when a child reaches the age of 6 as opposed to the current age of 16.

3. Family assistance thresholds will be reduced.

4. Doctor visits will no longer be free – a fee of $7 will be charged.

5. The Energy Supplement will stay in place and the government estimates the average family will benefit to the tune of $550 due to the abolition of the Carbon Tax.

6. The cost of running a car will rise – the gasoline tax that has been frozen since 2001 will now be indexed to inflation twice a year.

7. If you were born after 1965 your retirement age will be raised to 70.

If you want to find out more about how the 2014/15 Budget will affect your financial future, phone Wealthwise on 08 9380 6333 to speak to one of our advisers or use our Contact Form.

 For Federal Treasurer Joe Hockey’s full statement check out the government’s budget website.

2014-15 Federal Budget – 4 Things Pensioners Need to Know

Retirement at 70

Retire At 70?

Pensioners are not being hit as hard as some other segments of society but they will see some changes. The 4 most important ones are:

1. Asset and associated income test thresholds will be indexed between now and 2017, but then remain at fixed levels for three years.

2. From 2017, pension increases will be linked to inflation instead of wages. As wages generally increase faster than inflation this saving for the government will mean a loss to pensioners.

3. The Annual Seniors Supplement will be abolished.

4. Untaxed superannuation will be included in the income test for new recipients of the Commonwealth Seniors Health Card.

If you want to find out more about how the 2014/15 Budget will affect your financial future, phone Wealthwise on 08 9380 6333 to speak to one of our advisers or use our Contact Form.

For Federal Treasurer Joe Hockey’s full statement check out the government’s budget website.

 

2014/15 Federal Budget – 5 Things Businesses Need to Know

2014-15 Federal Budget

2014-15 Budget Crunch

Business organisations have generally welcomed the budget because they feel it introduces some fiscal discipline to a growing debt burden. High earners will be the big losers.

 

The 5 highlights as far as businesses are concerned are as follows:

1. The Carbon Tax and Mining Tax will be abolished.

2. 800,000 small businesses will have their company tax cut by 1.50%

3. The government will pay up to $10,000 to businesses that employ a person who has been on unemployment benefits or the Disability Support Pension for six months.

4. Expanding overseas markets with new free trade agreements with Korea and Japan.

5. Top marginal tax rate to increase by 2.00% for those earning over $180,000. This Temporary Budget Repair Levy will last for 3 years.

If you want to find out more about how the 2014/15 Budget will affect your financial future, phone Wealthwise on 08 9380 6333 to speak to one of our advisers or use our Contact Form.

For Federal Treasurer Joe Hockey’s full statement check out the government’s budget website.

 

2014-15 Federal Budget – 4 Things Students and Young People Need to Know

Vocational Training Is A Winner

Vocational Training Is A Winner

 

The Treasurer has placed quite an emphasis on young people and education this year. Vocational training is the big winner.

1. The government will start viewing vocational training in a similar light to higher education. They will provide apprentices doing a four year training with Trade Support Loans of up to $20,000. Those studying for diplomas and sub-bachelor degree courses will also be eligible for government support.

2. From 2016, universities will be allowed to set their own tuition fees. However, if you are already studying, you are ‘grandfathered in’ until 2020.

3. Fees only become repayable when students are in the workforce and earning over $50,000 per year.

4. Newstart for those unemployed under the age of 25 will become Youth Allowance, while those jobless under the age of 30 face a six-month wait before they can claim benefits.

 

If you want to find out more about how the 2014/15 Budget will affect your financial future, phone Wealthwise on 08 9380 6333 to speak to one of our advisers or use our Contact Form.

For Federal Treasurer Joe Hockey’s full statement check out the government’s budget website.

 

 

 

Merry Christmas From The Wealthwise Team

The Wealthwise team would like to wish all our clients, friends and partners a Merry Christmas and a Prosperous 2014!

We’ll be closed from 5.00pm Friday 20th December and reopen on Monday 6th January, 2014 at 8.30 am.

 

5 Websites To Help Make Your Christmas Special

 

The Wealthwise team have chosen 5 website that we think will help to make your Christmas 2013 special.

1. First up, don’t forget to watch that Christmas classic, the Snowman. A beautiful story and haunting music combine to make it the ultimate feelgood kids movie. 

2. Perth is becoming world-famous for the Christmas decorations outside its private hours. Use this website to plan your tour.

http://www.kids-around-perth.com/christmas-lights.html

3. Music impresario Andre Rieu wowed Perth audiences last month. If you’re suffering from withdrawal symptoms you still have time to register for his Advent Calendar giveaway – concert tickets and music downloads are among the goodies.

http://christmas.andrerieu.com/2013/welcome.html

4. If you’re stuck for last minute festive recipe or activity ideas check out the Christmas ideas section of this popular Aussie site

http://www.kidspot.com.au/christmas/

5. And last, but definitely not least, add to your kids’ Christmas magic by joining NORAD in tracking Santa from the North Pole to Perth.

http://www.noradsanta.org/

Have a great Christmas!

Wealthwise Wins 3 Financial Industry Awards

 

Award-winning Wealthwise Team

Award-winning Wealthwise Team

In the last month, Wealthwise has received 3 prestigious financial planning industry awards.

The company received the Financial Wisdom Quality Recognition  and WA Practice of the Year awards while adviser Paul Turner won the Financial Planning Association’s WA Value of Advice Runner-up.

The Financial Planning Association of Australia (FPA) is the professional association for qualified financial planners in Australia while Financial Wisdom is a financial planning organisation that has built a reputation over the last 18 years for “considered thinking” in offering financial advice.

Because these two organisations have such high standing in Australia’s financial planning industry, Wealthwise see this as a notable achievement.

 “We’re very proud to receive this recognition from our peers in the financial planning industry,” says Jamie Luxton, principal of the Perth-based company. “There are a lot of companies out there doing great work for their clients, so for us to win 3 awards in one month is something very special. We are a very service-focused company and this demonstrates what a great job Wealthwise advisers and office staff are doing for our clients.”

The General Manager of Financial Wisdom, Mark Ballantyne, also congratulated Wealthwise on their achievement:

 “Wealthwise are an active contributor to the Financial Wisdom network and we are pleased that they have been recognised through a number of award. The Quality Recognition Award is voted by the team that audits the files and sets the Licensee Standards we all adhere to so this is high praise. This, on top of Paul Turner’s runner-up in the WA FPA awards and Wealthwise winning the WA State Practice of the Year for Financial Wisdom, rounds out a very successful year for Wealthwise.”

 

RBA Cut Rates to Record Low – Dollar Rises. Confused?

Rates Down, Dollar Up?

Rates Down, Dollar Up?

Amid continuing concern about the direction of the economy, the Reserve Bank of Australia has cut interest rates by 25 basis points to a record low of 2.5%, a level not seen since 1959. And yet, perversely, the dollar rose against the greenback.

So what happened to this basic economic formula:

Cut interest rates = currency less attractive = money flows out of the country = currency falls

In his statements regarding the 8 interest rate cuts since November 2011, RBA  Governor Glenn Stevens has consistently highlighted the expensive Australian dollar as a concern that needs the attention of government instruments. At first , the cuts seemed to have the opposite effect and the Aussie remained strong, but since April it has lost around 15%.

Goal achieved.

But now we see a slight rise for the Australian dollar and some pundits thinking it may even strengthen a few more cents. What is happening?

It seems this anomaly is due to a couple of factors:

1. An expectation that the latest cut will encourage spending and stimulate growth

2. Analysts reading between the lines saying Stevens’ statement is not indicative of any future cuts

Or perhaps it’s because people have stopped believing the doom and gloom about Australia’s “economic woes”?

During  a recent business conference at the Institute of Australian Institute of Company Directors in Sydney , Goldman Sachs CEO Lloyd Blankfein was asked for his take on the parlous state of the Australian economy.

“No, it’s awful – you’ve now sunk to a level that we’re trying to get up to. So, my heart goes out to you,”

In other comments, Blankfein seemed mystified by  the negative mindset of Australians.

Add to that this recent observation from Citigroup’s Chief Economist Professor Willem Buiter

”Australia’s position is not without issues, but [its] problems are luxury problems compared to those in the rest of the advanced economy universe.”

 

and you have to wonder if Australians are trying to talk themselves into a recession.

Budget 2013 – Throwing The Baby Out With The Bathwater?

2013-14 Budget

As predicted by the pundits, there were few surprises in Treasurer Wayne Swan’s 2013-14 Budget.

Going from a small surplus to a deficit of $18 billion in 2013-14 didn’t seem to raise many eyebrows given the ongoing revelations about the government’s over-optimistic estimates of revenue from the mining industry.

As for the nitty gritty of the budget, It seems to be more of a case of jam tomorrow and a bit of pain today.

The government is promising substantial investment in transport infrastructure  in Melbourne, Brisbane and Sydney (a total of $5.9 billion), $9.8 billion for schools from 2014-15,  a 10% increase in defense spending over 4 years, and $21.4 billion towards the construction of the National Broadband Network (again over a four year period).

However, what might hurt the government most in the forthcoming September 2013 General Election is the measures that will more immediately impact voters. Whatever the electorate might tell polling organisations, in the end, they usually vote with their wallets. Scrapping the cash payment to parents of newborns and capping family payments might not seem a big deal but hitting families is never a good idea in an election year. For those with older kids, higher education will also become more expensive because of $2.3 billion in cuts. Added to that is the 33% increase in the Medicare levy from 1.5% to 2.0%.

The so-called ‘double taxation’ of earnings of more than $100,000 of superannuation pensions will, while only applying to a small number of retirees, be another stick for the Opposition to beat the government.

Taking candy from the mouths of babes and pensioners?  Not an auspicious start to an election campaign.

 

RBA Cuts Interest Rates to Historic Low

Yesterday, the RBA cut interest rates to an historic low of 2.75%

                                                                                                                                                                                                                                                      Governor Glenn Stevens, in the RBA statement explaining the Reserve Bank’s thinking, seemed to be generally

RBA Cuts Interest Rates to 2.75%

RBA Cuts Interest Rates to 2.75%

 upbeat about the Australian economy but again was worried about the high Australian dollar.

As we commented on a previous interest rate cut, when you have the best economy in the world, it’s surprising that the experts are surprised by a strong currency.

Anyway, in the words of Mr Stevens

“The Board has previously noted that the inflation outlook would afford scope to ease further, should that be necessary to support demand. At today’s meeting the Board decided to use some of that scope. It judged that a further decline in the cash rate was appropriate to encourage sustainable growth in the economy, consistent with achieving the inflation target.”

No doubt Reserve Bank will be surprised again in 6 months’ time at the robustness of the Aussie. Maybe they can just copy and paste this from the current press release.

“The exchange rate, on the other hand, has been little changed at a historically high level . . . “