Money Magazine June 2017

“A budget is telling your money where to go instead of wondering where it went.” Dave Ramsey, author Whatever your thoughts are on our cover story – and, by the way, I would love to hear – I want to make it very clear that I’m a big supporter of superannuation. As founder of, and ambassador for, Money/ASFA’s Super Booster Day, I believe in super and encourage all to take advantage of the tax perks it has to offer. Having said that, the biggest issue to confront many people is that as they accumulate more assets they progressively lose the age pension. Now, having too much wealth to qualify for the age pension is a good thing, right? Well, that depends. After receiving an email from one of our readers…

Perseverance pays off It pays to seek a second opinion. Recently I sought to invest a significant sum in a term deposit. The personal rate on offer was 3.20%pa for a two-year term. I asked if this rate applied to our two-member self-managed super fund with a corporate trustee only to be told, no, the business rate of 2.20%pa would apply. Following emails and phone calls to bank administration I managed to find my answer: the personal rate applied to an SMSF with either an individual trustee or a corporate trustee structure as long as there are four or fewer members. I returned to the same bank three days later and, after educating the local branch, got 3.20%pa for a two-year term. Lyall, Vic Investment in a career I think…

Home ownership’s unexpected expenses Here is some food for thought for all those young people bellyaching about not being able to buy a house and how hard it is to save a deposit. Never mind the deposit; it’s all the unexpected expenses that can come with a house or unit once it is yours. I bought my house nearly four years ago. Things are tight as I pay more than I need to offset my mortgage to brace for the interest rate rise that is coming. But now the 20-year-old timber retaining wall that runs along the border of my property needs to be replaced. This will cost $20,000 to $30,000 and my neighbour is not keen to contribute towards the project. So now the stress begins. Do I just…

EFFIE ZAHOS Effie is Money’s editor and author of The Great $20 Adventure. Effie says: “Can you tax your way to surplus? Time will tell but I did like the distinction between good debt and bad debt, plus am happy to pay a little more in Medicare if it means it’s retained and available for all.” SAVANTH SEBASTIAN Savanth is a senior economist at CommSec. Savanth says: “The government is right to focus on the need to build our infrastructure assets. And especially on transport assets. Increased spending on infrastructure is positive for a raft of industry sectors including building materials, transport, industrials, developers and contractors and consumer discretionary sectors.” SAM HENDERSON Sam, CEO of Henderson Maxwell, says: “My highlight was the ability for ALL over 65s to downsize their…

“I do feel that we should, like all other first world economies, provide more incentives for the genuine homeowner and less for investors” In the last issue I thought it was worth writing about the so-called “housing price bubble” in the big cities in the eastern states, and also the vexed issue of housing affordability. You are correct if you are thinking that they are pretty much the same issue. But apart from bumping up interest rates, population growth slowing or declining or our economy going into recession, property prices in Sydney, Melbourne and Brisbane, while likely to slow after a long boom, are not likely to fall. My position on property is built around very basic common sense. We have a rapidly growing population in Australia and globally. As…

The federal government’s sweeping changes to the 457 visa scheme have created confusion and concern among employers and workers across many industries, including IT, mining, oil and gas, retail and hospitality. The 457 program has worked effectively as a demand-driven, temporary-skilled visa program, with the number of visas granted rising and falling with changing circumstances in the labour market. For example, according to the government’s own statistics, cooks, IT programmers and restaurant managers were the top three occupations granted 457 visas in the second half of 2016. The changes affect the hospitality and IT sectors, and others, by tightening criteria, removing the right of some skilled workers to apply for a 457 visa or by reducing the visa term from four years to two. Under the changes, workers such as…