Plannng for life - not just retirement, willpower and protecting your super legislation
Winter is upon us as is the end of the financial year once again! Time to get those last minute super contributions in, bring forward any expenses etc as outlined previously, and get organised for the rest of the year. I know many of you are also heading North to chase the sunshine so enjoy that!
In this months newsletter we have included an article on financial willpower which is so important for young people these days. Good habits start early. My son Ethan got his licence earlier this year and bought his first car from his savings (with a little tipped in by his parents). Now that he is not saving for a car, the cashflow from his gymnastics coaching job while he is studying has improved, but the saving has reduced. His girlfriend is planning a trip to Bali at the end of this year and wants to get the airfares sorted in the next few months. She did casually say to Ethan that if he didn't have enough money, she would find a friend to go with. Yes - tough love, but guess what - savings has started again with earnest.............A goal is a wonderful motivator.
On another note, you may or may not be aware about the Federal Government’s Protecting Your Super Package Act that comes into effect on 1 July 2019. The package is designed to protect Australians’ superannuation savings from unnecessary erosion by fees and insurance costs.
The legislation includes changes to fees, the transfer of inactive low-balance accounts to the Australian Tax Office (ATO), and stopping insurance for inactive accounts.
An inactive account is any account that hasn’t received any contributions or rollovers for more than 16 months.
If a person’s insurance is cancelled they will no longer be covered.
Before taking action, your super provider must tell you that you’re at risk of having your insurance cancelled and give you the opportunity to choose to keep your insurance. You can stop your insurance being cancelled by letting your super provider know that you want to keep your insurance. However, your superannuation provider may find it difficult to contact you if they don’t have up to date contact details.
If you think this legislation will affect you please take action.
Lastly, we have included the latest market update. If you have any questions or know of someone that we may be able to help please let us know. We have also included our latest Financial Services Guide for your records.