February 21, 2018

Potential pension minefields

It has been a big year for the SMSF industry given the major policy changes the federal government made to super in the 2016 budget. Last week the Self-managed Super Fund Association held its national conference in Sydney and it provided a natural forum for the leading practitioners in the SMSF industry to reflect on and debate the impact of the changes on SMSF trustees and how it will affect the operation of funds in the future. Industry practitioners – be they advisers, accountants or lawyers – have had a busy 12 months getting to grips with a myriad of […]
February 14, 2018

How to make your term deposits work harder

Despite continued record low interest rates, there’s still a place for term deposits in an investment portfolio. In 2011, the average term deposit could earn you around 6 percent per annum. Since then, the times, they have a-changed – and so have term deposit rates. Since the Global Financial Crisis (GFC) we remain a little nervous around risk, so despite average term deposit rates now being closer to 2.5 percent, they’re included in our portfolios for the capital security and diversification components they offer. The Reserve Bank of Australia (RBA) sets the cash rate via its monetary policy. The aim is […]
February 7, 2018

Should we be worried about the recent falls in stock markets?

No, but read on to find out why: It looks like the market will finally get something that happens, on average, about once a year: a 10+% percent drop—the definition of a market correction.  They aren’t.  Corrections are unnerving, but they’re a healthy part of the economy—for a couple of reasons. Reason #1: Because corrections happen so frequently and are so unnerving to the average investor, they “force” the stock market to be more generous than alternative investments.  People buy stocks at earnings multiples which are designed to generate average future returns considerably higher than, say, cash or bonds—and investors […]