by Mark | Mar 4, 2015 | Education Series, Insights, Insurance
“One in two Australians will be diagnosed with cancer in their lifetime”. A scary statistic, and a good general interest piece about the warning signs not to ignore. http://www.smh.com.au/lifestyle/diet-and-fitness/cancer-symptoms-the-10-red-flag-warning-signs-20150209-139pch.html If it does happen to you, ensure your savings, home equity or investments aren’t eaten away funding treatment. Do you know that you can have insurance (and not just private health cover) to pay for these and other crisis...
by Mark | Mar 26, 2014 | Insights, Periodic Market & Investment Update
The activity in the world markets does not stop, and processing the recent changes requires a very patient mind. At the present time this will be important for anyone with investment exposure particularly within their superannuation which is the most common. In this update we have prepared a brief on the key issues, numbers and short points about our economy, investment markets, currencies and generally issues that impact our financial lives. Current Rates and Key Numbers Arrows indicate change over last 6 months: RBA Cash Rate: 2.50% ↔ 1-year bank deposit rate: 3.55%* ↓ Average Standard Variable Mortgage Rate: 5.15% ↔ Two Year Fixed Mortgage Rate: 4.99% ↔ AUD/USD: $0.9166 ↑ AUD/GBP: £0.5539 / $1.81 ↑ Australian Share Market: 5,396 points ↑ Average Dividend Yield of Australian Share Market: 4.85% ↑ *(average of major 4 banks) A Brief Review of What Has Been Happening around the World Australia Australian shares were quite volatile at the beginning of this year. January’s 3.0% decline in the S&P/ASX 200 Accumulation Index was followed by a 5.0% rise in February, pushing the market up towards its highest level since mid-2008. The Reserve Bank of Australia (RBA) held the cash rate steady at 2.5% for an eighth consecutive month at its March 2014 meeting. The RBA surprised some by explicitly removing its mild easing bias and reference to the Australian dollar (AUD) being “uncomfortably high”. The Board is now looking for a “period of stability in interest rates”. The RBA revised-up its growth forecasts by 0.25%, with GDP now expected to be 2.5% for the year. A return to near-trend growth of 3.0% per year is expected in the first half of 2015 (interest rates...
by Mark | Feb 18, 2014 | Education Series, Insights
INFLATION INFLATION INFLATION! Let’s start with a term that we hear every day, and in particular around the first Tuesday of each month when the Reserve Bank of Australia (‘RBA’) considers what will happen with interest rates. Inflation is an increase (or decrease in the case of deflation) in the general level of prices of goods and services in the economy. A core function of the RBA is to ensure inflation remains consistent in Australia each year between 2-3%, which is modest and manageable at the business and household level and often in line with wages growth. How does this work in practice? To understand how this works, imagine a world that only has two commodities: Oranges picked from orange trees, and paper money printed by the government. In a year where there is a drought and oranges are scarce, we’d expect to see the price of oranges rise, as there will be quite a few dollars chasing very few oranges. Conversely, if there’s a record crop of oranges, we’d expect to see the price of oranges fall, as orange sellers will need to reduce their prices in order to clear their inventory. These scenarios are inflation and deflation, respectively, though in the real world inflation and deflation are changes in the average price of all goods and services, not just one (i.e. food, petrol, electricity and so on). The key is ensuring your wage/income growth also keeps up – if the general cost of living increases by say 3% this year, but your wage remains the same, effectively your money will have less purchasing power than it did last year. What...
by Mark | Feb 4, 2014 | Insights, Key Alert
The Reserve Bank of Australia announced at 2:30pm (AEST) this afternoon that the cash rate will remain at 2.50%. RBA Governor Glen Stevens cited 4 key reasons behind their decision of continuing to keep interest rates at the same level since the last cut in August 2013: Global growth below trend, however an expectation this will increase over the course of the year. Unemployment has continued to edge higher Resources sector investment spending set to decline significantly Inflation in the December quarter was higher than expected. Looking forward: The Bank expects growth to remain below trend for a time yet however strengthening and; Unemployment to rise further before it peaks Expected further stability in interest rates (i.e. a ‘hold’ bias) The RBA’s next meeting will be on Tuesday 4th March. For more information...
by Mark | Jan 9, 2014 | Insights
What’s your financial goal for 2014? The above quote by author, entrepreneur, marketer, and public speaker Seth Godin may be true for some, however it seems to me that the people who get things done, who lead, who grow and who make an impact … have goals. It’s early 2014 and no doubt some New Year’s Resolutions have been made. Lose weight, improve fitness, quit smoking, save more money … they are all very common goals. Particularly the last one! To improve your financial position it is important to create a goal for the year. Creating a goal helps you identify what you want to achieve, measure your success and keep you motivated to stick to your strategy throughout the year. If you can see results, you are more likely to stick to it. According to global fund management firm Fidelity’s 2014 New Year Financial Resolutions Study, the top goals made for this year are: Save more money — 54% Pay off debt — 24% Spend less money – 19% Develop a long-term-goal plan — 13% Make/stick to a budget — 12% Pay down credit card debt – 8% Interestingly, only 12% had a financial resolution of making a budget. We have a not-so-secret concept for you: making and sticking to a budget can help you achieve the above resolutions. The 5 critical steps to setting up a financial budget plan are: 1) Identify your Specific Goals. Try not to leave it just at “save more money”. Dig down further and itemise each individual goal. Whether it is paying off the credit card, a holiday, new car or just paying...
by Mark | Nov 28, 2013 | Insights
Where to next? Going Up or Down? To Fix or Not to Fix? Leading economists predict there may be an interest rate cut in February or March 2014. We think the next rate rise won’t be until at least this time next year. What does this mean for your home loan rate until then? Since the last two interest rate cuts in May and August this year (0.50% in total), most Banks haven’t passed these cuts on to borrowers. Fixed rates have only fallen up to 0.2% over this period. This tells us lenders don’t think there will be many more interest rate cuts over the coming year. What to think about: Is it time to refinance? Is it time to consider an investment property and fix your rate – giving you certainty on what your expenses will be? Let’s do the sums. Be sure to take a look at your current rate today! Shop around. Lean on your current lender for a better deal. Contact us for more information or for advice on your personal...
