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Why income insurance is an important part of protecting a subcontractor’s assets.

Subcontractors find themselves in a unique position. They don’t have a boss or a regular paycheck, meaning that they don’t have access to workers’ compensation or sick leave. If they become too sick or injured to work, they don’t have a financial “cushion” upon which to lean on. That is why many purchase income insurance, or “income protection insurance.”

How Income Protection Insurance Works

Simply stated, if you are hurt or ill and unable to work, income protection insurance can replace as much as 75% of your income until you are able to go back to work. This comes in handy for feeding your family and paying bills while you are unable to produce income through working.

Every income protection insurance policy has three parts:

Benefit Amount

This is the amount of money you will

Can astute financial planning, such as an AMP Super Fund, help quell fears of Australian men worried about their retirement?

The Survey

Recently, The Digital Edge conducted an exclusive survey for News Corp Australia, entitled, “Men and Money.” 1,000 men from various parts of Australia were surveyed on the impact of financial difficulty on their lives. The survey participants were from diverse backgrounds, but there were many commonalities in their answers, much to the surprise of those conducting the survey.

The biggest takeaway: one out of three men said they had difficulty living on their current incomes. In South Australia, that number jumped to 49%. More than 50% of those who responded feel that they are under “financial stress” 365 days a year. Lack of savings, current expenses and the spectre of future expenses were most often cited as the sources for stress.

Close to 70% of the men surveyed said that financial stress had led to problems with their health or relationships at least once in their lives. Loss of family, depression, drinking, heart problems and even thoughts of suicide were among the most common complaints.

One common theme was that those men who allowed themselves to be interviewed on the record said that they were more likely to keep their worries to themselves as opposed to burdening their spouses.

The best way to understand life insurance is to realise that there is nothing to be afraid of when discussing it.

By its very nature, life insurance can be scary because it involves accepting one’s mortality and setting affairs in order to protect them from the aftermath of events that nobody likes to talk about. This scares a lot of people off and keeps them from learning what they need to know about life insurance.

Did you know that many policies actually help support you in your recovery when you are stricken by a major illness or life event involving injury? Here are some various types of life insurance products.

Two Basic Classes of Life Insurance: Temporary and Permanent

Temporary

Temporary life insurance is purchased for a fixed period of time, such as twelve months. When the term is over, you renew the policy or purchase a different one. Insurance policies classified as temporary are seen as providing greater flexibility and are the more popular of the two classes.

What aspects of finance can be improved by financial planning and why superannuation regulations in Australia can be difficult to navigate without qualified help.

Many Australians ask whether or not they need a financial planner. While we cannot give blanket advice to anyone, we can give you an idea of situations in which a financial planner can be helpful. Ultimately, the decision of whether or not you need a financial planner is yours to make. Here are some services we provide that may be difficult to perform on your own.

Retirement Planning

Different people attach different meanings and goals to the word “retirement.” A financial planner can help you formulate a customised retirement plan that can help you retire with the income that you want. The sooner you begin planning for retirement, the easier it is to get you there with the lifestyle you want to live.

Superannuation

Superannuation is designed to provide Australians with a vehicle for investing in and saving for retirement. A good superannuation strategy can help you maximise tax concessions in conjunction with any government benefits you may or may not be receiving to ensure a comfortable retirement.

How the unique structure of trauma insurance in Australia can be beneficial to cancer sufferers.

Trauma insurance is a type of insurance that covers you if you sustain an illness that is included in the policy. Trauma insurance protects those who become ill. Although policies differ from company to company, most trauma insurance protects from cancer, heart attack and stroke.

Cancer is covered in most trauma insurance policies, but not all types of cancer are always included, so we always recommend that you read your policy thoroughly so that you know what is covered and what isn’t.

Not only are some covered and some not, but many policies have different cover for different forms of cancer. Cancers that are classified as pre-malignant conditions such as many forms of skin cancer are often excluded from coverage. Your insurance consultant will be glad to help you fully understand your policy.

How Insurance Companies Define Cancer

In 2010, AMP published a Risk Bulletin in which it provided the public with information on how they define cancer. According to the bulletin, “AMP will pay if a person suffers from a malignant tumor.” For prostate cancer, they go on to describe a complicated process of deciding which tumors are covered.

Superannuation helps secure the future of many in Australia. Here are some of the benefits.

Superannuation is designed to help us prepare for retirement as part of a three-pronged approach. For many Australians, a well-conceived super fund can be the difference between comfortable retirement and a constant struggle in the years when it is the most painful. Here are some of the reasons why we like superannuation.

Tax-Effective Savings

Superannuation is designed to help Australians become self-sufficient when they retire. It is set up with a series of tax breaks to encourage contributions.

Salary Sacrifice

Those who utilise salary sacrifice can reap huge savings because earnings that go towards salary sacrifice are only taxed at a rate of 15%. For someone in a tax bracket of 45%, this represents huge savings.

Why do so many property investors use a home loan broker? Read further.

Recently, the Property Investment Professionals of Australia (PIPA) surveyed 800 property investors in conjunction with the magazine Smart Property Investment. More than 70% said that they use the services of a home loan broker. In sister magazine The Advisor, Ben Kingsley, who is the Chair of PIPA, shared a broker’s view of why so many property investors use mortgage brokers.

Engagement

Many officers in banks or other lending institutions don’t have the time to “go the extra mile” for customers due to heavy workloads and limited selection of credit products. Mortgage brokers, on the other hand, have plenty of time and specialise in finding a custom solution for each individual based on their financial situation, goals and ability to meet mortgage repayments.

Brokers Provide More Access

A home loan broker has access to a lot more credit products than any single lender, because they use multiple lenders. This gives us the flexibility to find a loan that is tailored to your situation. We also help you with your paperwork because we know that it may be the difference between obtaining the right loan and being turned down.

Insurance provider in Perth explains how a disability insurance scheme is benefitting many Australians who suffer from total permanent disabilities.

One of the main advantages to bundling is that you can work with one insurance agent and develop a plan that is both customised and comprehensive, without the inconvenience of managing multiple policies.

Bundling TPD and life insurance can be particularly beneficial if someone becomes totally and permanently disabled and then dies shortly thereafter. However, collecting TPD payments can often reduce the life insurance benefit. For example, if you have $500,000 worth of TPD cover and $1 million in life insurance, collecting the $500,000 for TPD will change your payout for life insurance to $500,000 with a standard policy.

TPD Buyback and Double TPD

Some policies allow the user to “buy back” whatever life cover was affected by collecting TPD money. Restrictions vary from policy to policy.

Other policies have a “double TPD” feature in which there is no life cover reduction when collecting TPD. In addition, some policies state that a buyer who collects TPD is no longer responsible for paying the premiums on their life insurance.

A sound SMSF investment strategy can go a long way towards providing peace of mind and a prosperous retirement.

Many Australians are taking advantage of the opportunity to set up their own SMSFs. However, this can be a double-edged sword. While a brilliantly-maximised SMSF can provide a prosperous lifestyle during retirement, mistakes in strategy can cost thousands of dollars. Due to the highly-regulated nature of SMSFs, it is our belief that one should always seek the help of professionals who are trained in the regulations and in maximising investments such as an SMSF.

To manage an SMSF, you must register as a Trustee. One of your mandatory duties as an SMSF trustee is to formulate and document an investment strategy. This is a financial plan that takes into consideration the current and future needs of every SMSF member, even if you are the only member.

Every SMSF is required to pass a test from the ATO called a “Sole Purpose Test,” which requires all investments “to have the sole purpose of providing retirement benefits or death benefits to the Beneficiaries of the SMSF.”

One of the most-cited benefits of an SMSF is having control of your investments. The SIS Act requires all trustees to formulate, execute and document all investment decisions and to monitor their performance on an ongoing basis. The SMSF investment strategy is an essential and mandatory part of this process.

The Investment Strategy Dictates Investment Results

Since all investments in the SMSF must be invested according to the investment strategy, the strategy must be sound in order to produce optimum results. All factors must be considered in an SMSF investment strategy. This includes assessing risk against possible return on investment.

It also includes the composition and diversity of the investments and maintaining a degree of liquidity within the fund. The SMSF must also have the ability to discharge any existing liabilities.

Putting It All Together

A sound SMSF investment strategy will contain diverse investments such as property, shares and cash. The SMSF must be able to pay expenses and should be protected by adequate insurance. It must also be able to pass an independent audit conducted on an annual basis.

To learn more, call our financial planners in Perth: (08) 6462 0888.

Why financial planning is worth the fees you may pay for their services and how you can benefit from a great financial planner.

Hiring a great financial planner can make the difference between a prosperous retirement and a small nest egg, but many people don’t know exactly what a financial planner does. Here are some services you can reasonably expect from most financial planners.

Assess Your Financial Situation and Ask about Your Goals

Your first appointment, more of a “getting to know you” than a strategy session, allows the planner to know what you want and what resources you have at your disposal. He or she will compare your income and assets against your expenses and debts to gain an accurate picture of your situation.

During the first session, you can tell the financial planner what your goals are and together you can figure out how much money you need to attain them.