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The Advertiser
2 days ago
- Business
- The Advertiser
Now is the perfect time to take stock and set financial goals
Welcome to a new financial year. Once again, we've lived through an eventful stretch, full of bold predictions about what might happen if Donald Trump returned to the White House. My inbox was flooded "Should I sell everything? Will the markets collapse?" But my answer never changed. If you hold a well-structured share portfolio, the smart play is to stay the course. Long-term investing means riding out the inevitable turbulence. And we sure got some turbulence. In early April 2025, global markets took a dramatic turn. On 2 April, President Trump announced sweeping tariffs, triggering what's now called the "Trump Thump": a historic two-day plunge in which the S&P 500 fell 10.5 per cent, wiping out over $3 trillion in value. But by 9 April, the US administration had paused the tariff rollout, sparking a powerful rebound. Major indices posted their biggest gains in years, with the S&P 500 back in positive territory by 13 May. That rollercoaster reminded us how sensitive markets are to political shocks. There's no doubt markets - especially overseas - are volatile, with wild price swings now the norm. Two key drivers are behind it. First, traders chasing quick profits jump in and out, fuelling the noise. Second, investor psychology kicks in: people reacting emotionally to headlines. One great benefit of shares is their liquidity; you can sell quickly if needed. But liquidity is a double-edged sword - it makes markets more jumpy. Traders play games, while mums and dads panic and bail out - often at the worst possible time. The start of a new financial year is the perfect time to take stock and set goals for improvement. Start by listing your assets and liabilities, because the best map is useless if you don't know where you are. That simple exercise often shows exactly where to focus. If you've got a housing loan, ask yourself: could you shop around for a better rate? It's worth doing, especially if you have strong equity in your home. But if your equity is under 20 per cent, don't bother; lender's mortgage insurance (which isn't transferable) will most likely kill the deal. If you're 50 or over, your goal should be to have your mortgage paid off, or at least well under control, by the time you retire. The most effective strategy is to maximise your concessional super contributions, now capped at $30,000 a year. That includes what your employer pays, so if they're putting in $12,000, you can top up with another $18,000. It's far better than making extra mortgage repayments, because those come from after-tax dollars, whereas super contributions are pre-tax and tax-deductible. When you retire, you can pull a lump sum out of super, tax-free, to pay your mortgage out in full. For senior Australians, an essential question is: "Where do I want to be living in a few years?" As we age, we're likely to need some help. Is your current home suitable if your health or mobility changes? If you love the area, you might modify the home and stay put. But for many, especially those in big older houses with rising maintenance costs, downsizing may be the smarter long-term option. Also, make sure you have an enduring power of attorney and, if needed, an advance health directive. Many people never get around to completing or reviewing these documents, and the consequences can be dreadful if there have been major changes since they were last done. Another key task is estate planning. When did you last check your will? Update it to reflect any births, deaths, marriages, separations, or changes in your assets. Question: I refer to your response regarding the transfer of superannuation upon death. As I understand it, a dependant does not need to take a tax-free lump sum - they can instead be nominated as a reversionary beneficiary and continue receiving the super pension after the spouse's death. Would this have any impact on how Centrelink assesses the asset? If you nominate your estate (rather than a non-dependant individual) as the beneficiary, I understand the estate will pay the 15% tax, but no Medicare levy applies. The funds can then be distributed to non-dependants. Is this correct? Answer: Usually, only a spouse will be eligible to receive a death benefit super pension following the death of their partner. Centrelink will assess the super pension received by the surviving spouse under the current rules, subject to the pension type. You are correct that where the estate is nominated as a beneficiary, the estate will pay tax of 15% on the taxable component of the lump sum death benefit. No Medicare levy is payable. It can then be distributed to beneficiaries to non-dependants as stated in the Will. Question: We are a block of four company-share flats in St Kilda. Three of us are owner-occupiers. We often wonder if there's a viable alternative to being tied to a strata management company. More often than not, we reject the tradies and builders they recommend because the quotes are excessive - instead, we source our own people and pay directly. The sticking point is building insurance. That's tough to arrange independently, as it seems the strata managers use brokers who can access deals the rest of us can' really appreciate any suggestions for alternatives - maybe retired accountants, or different insurance avenues? Answer: Strata expert Frank Higginson tells me plenty of small blocks feel the same. The truth is, nobody's really lining up to manage the little ones. Doing it yourselves might sound good in theory, but it can make life harder, especially when it comes to insurance and tradies. Most insurers prefer dealing with brokers, and many tradespeople are reluctant to take on jobs with small owner-run bodies corporate - it's often more hassle than it's worth for them. And if it's true company title (rather than strata), that adds another layer of complexity - the compliance is usually even tougher. In short, no easy answers here. You can go it alone, but make sure everyone's ready to carry their share of the load - and the risks. Question: I'm 57, mortgage-free, and have been a full-time carer for many years, living mainly on the Carer Pension. My super is modest - mostly built up in the early 90s before I had a family, with a few part-time jobs during school years adding to it. I now want to improve my dental health and am exploring ways to fund dental implants. Can I access my super to help pay for it? My husband isn't working - he's been building our home - and his super is minimal, as he's only been in Australia since 2004. Answer: Yes, it's possible - but only under strict rules. The ATO allows early access to super on compassionate grounds to pay for certain medical treatments, including dental work - but only if it's to treat a serious or chronic condition or relieve significant pain. You'll need two medical reports (one can be from your dentist), a treatment plan, and a detailed quote. The application goes through the ATO via your myGov account. If approved, the ATO notifies your super fund and you arrange the release from there. Just be aware - the payment is taxed like a normal withdrawal. So if you're approved to receive $10,000, you'll get that in your hand, but more is taken from your fund to cover the tax. It's a good option for the right situation - just be sure you meet the medical criteria and have all your paperwork ready. Welcome to a new financial year. Once again, we've lived through an eventful stretch, full of bold predictions about what might happen if Donald Trump returned to the White House. My inbox was flooded "Should I sell everything? Will the markets collapse?" But my answer never changed. If you hold a well-structured share portfolio, the smart play is to stay the course. Long-term investing means riding out the inevitable turbulence. And we sure got some turbulence. In early April 2025, global markets took a dramatic turn. On 2 April, President Trump announced sweeping tariffs, triggering what's now called the "Trump Thump": a historic two-day plunge in which the S&P 500 fell 10.5 per cent, wiping out over $3 trillion in value. But by 9 April, the US administration had paused the tariff rollout, sparking a powerful rebound. Major indices posted their biggest gains in years, with the S&P 500 back in positive territory by 13 May. That rollercoaster reminded us how sensitive markets are to political shocks. There's no doubt markets - especially overseas - are volatile, with wild price swings now the norm. Two key drivers are behind it. First, traders chasing quick profits jump in and out, fuelling the noise. Second, investor psychology kicks in: people reacting emotionally to headlines. One great benefit of shares is their liquidity; you can sell quickly if needed. But liquidity is a double-edged sword - it makes markets more jumpy. Traders play games, while mums and dads panic and bail out - often at the worst possible time. The start of a new financial year is the perfect time to take stock and set goals for improvement. Start by listing your assets and liabilities, because the best map is useless if you don't know where you are. That simple exercise often shows exactly where to focus. If you've got a housing loan, ask yourself: could you shop around for a better rate? It's worth doing, especially if you have strong equity in your home. But if your equity is under 20 per cent, don't bother; lender's mortgage insurance (which isn't transferable) will most likely kill the deal. If you're 50 or over, your goal should be to have your mortgage paid off, or at least well under control, by the time you retire. The most effective strategy is to maximise your concessional super contributions, now capped at $30,000 a year. That includes what your employer pays, so if they're putting in $12,000, you can top up with another $18,000. It's far better than making extra mortgage repayments, because those come from after-tax dollars, whereas super contributions are pre-tax and tax-deductible. When you retire, you can pull a lump sum out of super, tax-free, to pay your mortgage out in full. For senior Australians, an essential question is: "Where do I want to be living in a few years?" As we age, we're likely to need some help. Is your current home suitable if your health or mobility changes? If you love the area, you might modify the home and stay put. But for many, especially those in big older houses with rising maintenance costs, downsizing may be the smarter long-term option. Also, make sure you have an enduring power of attorney and, if needed, an advance health directive. Many people never get around to completing or reviewing these documents, and the consequences can be dreadful if there have been major changes since they were last done. Another key task is estate planning. When did you last check your will? Update it to reflect any births, deaths, marriages, separations, or changes in your assets. Question: I refer to your response regarding the transfer of superannuation upon death. As I understand it, a dependant does not need to take a tax-free lump sum - they can instead be nominated as a reversionary beneficiary and continue receiving the super pension after the spouse's death. Would this have any impact on how Centrelink assesses the asset? If you nominate your estate (rather than a non-dependant individual) as the beneficiary, I understand the estate will pay the 15% tax, but no Medicare levy applies. The funds can then be distributed to non-dependants. Is this correct? Answer: Usually, only a spouse will be eligible to receive a death benefit super pension following the death of their partner. Centrelink will assess the super pension received by the surviving spouse under the current rules, subject to the pension type. You are correct that where the estate is nominated as a beneficiary, the estate will pay tax of 15% on the taxable component of the lump sum death benefit. No Medicare levy is payable. It can then be distributed to beneficiaries to non-dependants as stated in the Will. Question: We are a block of four company-share flats in St Kilda. Three of us are owner-occupiers. We often wonder if there's a viable alternative to being tied to a strata management company. More often than not, we reject the tradies and builders they recommend because the quotes are excessive - instead, we source our own people and pay directly. The sticking point is building insurance. That's tough to arrange independently, as it seems the strata managers use brokers who can access deals the rest of us can' really appreciate any suggestions for alternatives - maybe retired accountants, or different insurance avenues? Answer: Strata expert Frank Higginson tells me plenty of small blocks feel the same. The truth is, nobody's really lining up to manage the little ones. Doing it yourselves might sound good in theory, but it can make life harder, especially when it comes to insurance and tradies. Most insurers prefer dealing with brokers, and many tradespeople are reluctant to take on jobs with small owner-run bodies corporate - it's often more hassle than it's worth for them. And if it's true company title (rather than strata), that adds another layer of complexity - the compliance is usually even tougher. In short, no easy answers here. You can go it alone, but make sure everyone's ready to carry their share of the load - and the risks. Question: I'm 57, mortgage-free, and have been a full-time carer for many years, living mainly on the Carer Pension. My super is modest - mostly built up in the early 90s before I had a family, with a few part-time jobs during school years adding to it. I now want to improve my dental health and am exploring ways to fund dental implants. Can I access my super to help pay for it? My husband isn't working - he's been building our home - and his super is minimal, as he's only been in Australia since 2004. Answer: Yes, it's possible - but only under strict rules. The ATO allows early access to super on compassionate grounds to pay for certain medical treatments, including dental work - but only if it's to treat a serious or chronic condition or relieve significant pain. You'll need two medical reports (one can be from your dentist), a treatment plan, and a detailed quote. The application goes through the ATO via your myGov account. If approved, the ATO notifies your super fund and you arrange the release from there. Just be aware - the payment is taxed like a normal withdrawal. So if you're approved to receive $10,000, you'll get that in your hand, but more is taken from your fund to cover the tax. It's a good option for the right situation - just be sure you meet the medical criteria and have all your paperwork ready. Welcome to a new financial year. Once again, we've lived through an eventful stretch, full of bold predictions about what might happen if Donald Trump returned to the White House. My inbox was flooded "Should I sell everything? Will the markets collapse?" But my answer never changed. If you hold a well-structured share portfolio, the smart play is to stay the course. Long-term investing means riding out the inevitable turbulence. And we sure got some turbulence. In early April 2025, global markets took a dramatic turn. On 2 April, President Trump announced sweeping tariffs, triggering what's now called the "Trump Thump": a historic two-day plunge in which the S&P 500 fell 10.5 per cent, wiping out over $3 trillion in value. But by 9 April, the US administration had paused the tariff rollout, sparking a powerful rebound. Major indices posted their biggest gains in years, with the S&P 500 back in positive territory by 13 May. That rollercoaster reminded us how sensitive markets are to political shocks. There's no doubt markets - especially overseas - are volatile, with wild price swings now the norm. Two key drivers are behind it. First, traders chasing quick profits jump in and out, fuelling the noise. Second, investor psychology kicks in: people reacting emotionally to headlines. One great benefit of shares is their liquidity; you can sell quickly if needed. But liquidity is a double-edged sword - it makes markets more jumpy. Traders play games, while mums and dads panic and bail out - often at the worst possible time. The start of a new financial year is the perfect time to take stock and set goals for improvement. Start by listing your assets and liabilities, because the best map is useless if you don't know where you are. That simple exercise often shows exactly where to focus. If you've got a housing loan, ask yourself: could you shop around for a better rate? It's worth doing, especially if you have strong equity in your home. But if your equity is under 20 per cent, don't bother; lender's mortgage insurance (which isn't transferable) will most likely kill the deal. If you're 50 or over, your goal should be to have your mortgage paid off, or at least well under control, by the time you retire. The most effective strategy is to maximise your concessional super contributions, now capped at $30,000 a year. That includes what your employer pays, so if they're putting in $12,000, you can top up with another $18,000. It's far better than making extra mortgage repayments, because those come from after-tax dollars, whereas super contributions are pre-tax and tax-deductible. When you retire, you can pull a lump sum out of super, tax-free, to pay your mortgage out in full. For senior Australians, an essential question is: "Where do I want to be living in a few years?" As we age, we're likely to need some help. Is your current home suitable if your health or mobility changes? If you love the area, you might modify the home and stay put. But for many, especially those in big older houses with rising maintenance costs, downsizing may be the smarter long-term option. Also, make sure you have an enduring power of attorney and, if needed, an advance health directive. Many people never get around to completing or reviewing these documents, and the consequences can be dreadful if there have been major changes since they were last done. Another key task is estate planning. When did you last check your will? Update it to reflect any births, deaths, marriages, separations, or changes in your assets. Question: I refer to your response regarding the transfer of superannuation upon death. As I understand it, a dependant does not need to take a tax-free lump sum - they can instead be nominated as a reversionary beneficiary and continue receiving the super pension after the spouse's death. Would this have any impact on how Centrelink assesses the asset? If you nominate your estate (rather than a non-dependant individual) as the beneficiary, I understand the estate will pay the 15% tax, but no Medicare levy applies. The funds can then be distributed to non-dependants. Is this correct? Answer: Usually, only a spouse will be eligible to receive a death benefit super pension following the death of their partner. Centrelink will assess the super pension received by the surviving spouse under the current rules, subject to the pension type. You are correct that where the estate is nominated as a beneficiary, the estate will pay tax of 15% on the taxable component of the lump sum death benefit. No Medicare levy is payable. It can then be distributed to beneficiaries to non-dependants as stated in the Will. Question: We are a block of four company-share flats in St Kilda. Three of us are owner-occupiers. We often wonder if there's a viable alternative to being tied to a strata management company. More often than not, we reject the tradies and builders they recommend because the quotes are excessive - instead, we source our own people and pay directly. The sticking point is building insurance. That's tough to arrange independently, as it seems the strata managers use brokers who can access deals the rest of us can' really appreciate any suggestions for alternatives - maybe retired accountants, or different insurance avenues? Answer: Strata expert Frank Higginson tells me plenty of small blocks feel the same. The truth is, nobody's really lining up to manage the little ones. Doing it yourselves might sound good in theory, but it can make life harder, especially when it comes to insurance and tradies. Most insurers prefer dealing with brokers, and many tradespeople are reluctant to take on jobs with small owner-run bodies corporate - it's often more hassle than it's worth for them. And if it's true company title (rather than strata), that adds another layer of complexity - the compliance is usually even tougher. In short, no easy answers here. You can go it alone, but make sure everyone's ready to carry their share of the load - and the risks. Question: I'm 57, mortgage-free, and have been a full-time carer for many years, living mainly on the Carer Pension. My super is modest - mostly built up in the early 90s before I had a family, with a few part-time jobs during school years adding to it. I now want to improve my dental health and am exploring ways to fund dental implants. Can I access my super to help pay for it? My husband isn't working - he's been building our home - and his super is minimal, as he's only been in Australia since 2004. Answer: Yes, it's possible - but only under strict rules. The ATO allows early access to super on compassionate grounds to pay for certain medical treatments, including dental work - but only if it's to treat a serious or chronic condition or relieve significant pain. You'll need two medical reports (one can be from your dentist), a treatment plan, and a detailed quote. The application goes through the ATO via your myGov account. If approved, the ATO notifies your super fund and you arrange the release from there. Just be aware - the payment is taxed like a normal withdrawal. So if you're approved to receive $10,000, you'll get that in your hand, but more is taken from your fund to cover the tax. It's a good option for the right situation - just be sure you meet the medical criteria and have all your paperwork ready. Welcome to a new financial year. Once again, we've lived through an eventful stretch, full of bold predictions about what might happen if Donald Trump returned to the White House. My inbox was flooded "Should I sell everything? Will the markets collapse?" But my answer never changed. If you hold a well-structured share portfolio, the smart play is to stay the course. Long-term investing means riding out the inevitable turbulence. And we sure got some turbulence. In early April 2025, global markets took a dramatic turn. On 2 April, President Trump announced sweeping tariffs, triggering what's now called the "Trump Thump": a historic two-day plunge in which the S&P 500 fell 10.5 per cent, wiping out over $3 trillion in value. But by 9 April, the US administration had paused the tariff rollout, sparking a powerful rebound. Major indices posted their biggest gains in years, with the S&P 500 back in positive territory by 13 May. That rollercoaster reminded us how sensitive markets are to political shocks. There's no doubt markets - especially overseas - are volatile, with wild price swings now the norm. Two key drivers are behind it. First, traders chasing quick profits jump in and out, fuelling the noise. Second, investor psychology kicks in: people reacting emotionally to headlines. One great benefit of shares is their liquidity; you can sell quickly if needed. But liquidity is a double-edged sword - it makes markets more jumpy. Traders play games, while mums and dads panic and bail out - often at the worst possible time. The start of a new financial year is the perfect time to take stock and set goals for improvement. Start by listing your assets and liabilities, because the best map is useless if you don't know where you are. That simple exercise often shows exactly where to focus. If you've got a housing loan, ask yourself: could you shop around for a better rate? It's worth doing, especially if you have strong equity in your home. But if your equity is under 20 per cent, don't bother; lender's mortgage insurance (which isn't transferable) will most likely kill the deal. If you're 50 or over, your goal should be to have your mortgage paid off, or at least well under control, by the time you retire. The most effective strategy is to maximise your concessional super contributions, now capped at $30,000 a year. That includes what your employer pays, so if they're putting in $12,000, you can top up with another $18,000. It's far better than making extra mortgage repayments, because those come from after-tax dollars, whereas super contributions are pre-tax and tax-deductible. When you retire, you can pull a lump sum out of super, tax-free, to pay your mortgage out in full. For senior Australians, an essential question is: "Where do I want to be living in a few years?" As we age, we're likely to need some help. Is your current home suitable if your health or mobility changes? If you love the area, you might modify the home and stay put. But for many, especially those in big older houses with rising maintenance costs, downsizing may be the smarter long-term option. Also, make sure you have an enduring power of attorney and, if needed, an advance health directive. Many people never get around to completing or reviewing these documents, and the consequences can be dreadful if there have been major changes since they were last done. Another key task is estate planning. When did you last check your will? Update it to reflect any births, deaths, marriages, separations, or changes in your assets. Question: I refer to your response regarding the transfer of superannuation upon death. As I understand it, a dependant does not need to take a tax-free lump sum - they can instead be nominated as a reversionary beneficiary and continue receiving the super pension after the spouse's death. Would this have any impact on how Centrelink assesses the asset? If you nominate your estate (rather than a non-dependant individual) as the beneficiary, I understand the estate will pay the 15% tax, but no Medicare levy applies. The funds can then be distributed to non-dependants. Is this correct? Answer: Usually, only a spouse will be eligible to receive a death benefit super pension following the death of their partner. Centrelink will assess the super pension received by the surviving spouse under the current rules, subject to the pension type. You are correct that where the estate is nominated as a beneficiary, the estate will pay tax of 15% on the taxable component of the lump sum death benefit. No Medicare levy is payable. It can then be distributed to beneficiaries to non-dependants as stated in the Will. Question: We are a block of four company-share flats in St Kilda. Three of us are owner-occupiers. We often wonder if there's a viable alternative to being tied to a strata management company. More often than not, we reject the tradies and builders they recommend because the quotes are excessive - instead, we source our own people and pay directly. The sticking point is building insurance. That's tough to arrange independently, as it seems the strata managers use brokers who can access deals the rest of us can' really appreciate any suggestions for alternatives - maybe retired accountants, or different insurance avenues? Answer: Strata expert Frank Higginson tells me plenty of small blocks feel the same. The truth is, nobody's really lining up to manage the little ones. Doing it yourselves might sound good in theory, but it can make life harder, especially when it comes to insurance and tradies. Most insurers prefer dealing with brokers, and many tradespeople are reluctant to take on jobs with small owner-run bodies corporate - it's often more hassle than it's worth for them. And if it's true company title (rather than strata), that adds another layer of complexity - the compliance is usually even tougher. In short, no easy answers here. You can go it alone, but make sure everyone's ready to carry their share of the load - and the risks. Question: I'm 57, mortgage-free, and have been a full-time carer for many years, living mainly on the Carer Pension. My super is modest - mostly built up in the early 90s before I had a family, with a few part-time jobs during school years adding to it. I now want to improve my dental health and am exploring ways to fund dental implants. Can I access my super to help pay for it? My husband isn't working - he's been building our home - and his super is minimal, as he's only been in Australia since 2004. Answer: Yes, it's possible - but only under strict rules. The ATO allows early access to super on compassionate grounds to pay for certain medical treatments, including dental work - but only if it's to treat a serious or chronic condition or relieve significant pain. You'll need two medical reports (one can be from your dentist), a treatment plan, and a detailed quote. The application goes through the ATO via your myGov account. If approved, the ATO notifies your super fund and you arrange the release from there. Just be aware - the payment is taxed like a normal withdrawal. So if you're approved to receive $10,000, you'll get that in your hand, but more is taken from your fund to cover the tax. It's a good option for the right situation - just be sure you meet the medical criteria and have all your paperwork ready.
Yahoo
17-03-2025
- Business
- Yahoo
This is when the stock market bottom may occur: Yardeni
-- The recent stock market correction, which Yardeni Research has dubbed the "Trump Thump," has seen the S&P 500 fall 10.1% since February 19. Despite Friday's rally and "extremely bearish sentiment readings, which tend to be bullish from a contrarian perspective," the firm is not convinced the correction is over. In past downturns, such extreme sentiment often prompted a "Fed-Put easing response." However, Yardeni sees that as unlikely when Fed Chair Jerome Powell holds his presser following Wednesday's FOMC meeting, as he is expected to reiterate that "the Fed is in no hurry to lower interest rates." Meanwhile, Treasury Secretary Scott Bessent "said this morning that there are 'no guarantees' that there won't be a recession"—a comment that weighed on futures. Yardeni notes that the market may be searching for a bottom but remains "tarrified" by Trump's tariff threats and actions." The firm suggests that the market "might bottom after April 2, when Trump imposes reciprocal tariffs all around the world if they lead to tariff-reduction negotiations." The correction has largely been due to "falling valuation multiples, especially for the Magnificent-7 stocks," as concerns over tariffs and recession risks mount. However, the firm states that industry analysts "haven't gotten either the tariff memo or the recession memo," as S&P 500 forward earnings per share hit a record $278.59 during the March 13 week. Historically, the S&P 500 "tended to bottom when the index was more than 20% below its 200-day moving average." The index is currently only 1.8% below its 200-dma, suggesting further downside risk. Meanwhile, "most foreign stock markets have outperformed the US stock market," which Yardeni sees as a sign that Trump's tariffs "are more likely to depress the US economy than those in the rest of the world." Related Articles This is when the stock market bottom may occur: Yardeni Stellantis invests $41 million in Italy to make EV engine parts Brazil's economic activity sees unexpected growth in January Sign in to access your portfolio
