not enough time or money - supercharge your clients’ super · geoffrey chaucer - “time and tide...
TRANSCRIPT
Not enough time or money - Supercharge your clients’ super
Michael Harkin, National Manager – Training and Advice, Topdocs
What we will be discussing
1. Time and Money
2. Retirement Lifestyles
3. Supercharge Options
2015 SMSF Association National Conference www.smsfassociation.com
Time and Money
2015 SMSF Association National Conference www.smsfassociation.com
Time and Money
Geoffrey Chaucer - “Time and tide wait for no man”
2015 SMSF Association National Conference www.smsfassociation.com
Time and Money
Geoffrey Chaucer - “Time and tide wait for no man” Benjamin Franklin - “Time is money”
2015 SMSF Association National Conference www.smsfassociation.com
Time and Money
Geoffrey Chaucer - “Time and tide wait for no man” Benjamin Franklin - “Time is money” Shirley Temple - “Time is money - Wasted time means wasted money means trouble”
2015 SMSF Association National Conference www.smsfassociation.com
Time and Money
Geoffrey Chaucer - “Time and tide wait for no man” Benjamin Franklin - “Time is money” Shirley Temple - “Time is money - Wasted time means wasted money means trouble” Dr Seuss - “How did it get so late so soon”
2015 SMSF Association National Conference www.smsfassociation.com
Time and Money
= Age Money =
2015 SMSF Association National Conference www.smsfassociation.com
Retirement Lifestyles
How long will my super last?
2015 SMSF Association National Conference www.smsfassociation.com
Retirement Lifestyles
• Longevity
• Accumulated Super
• Spending/Saving Habits
• Generation
2015 SMSF Association National Conference www.smsfassociation.com
Retirement Lifestyles
Age Male Female Age Male Female
55 26.95 30.53 63 20.14 23.35
56 26.08 29.61 64 19.34 22.48
57 25.20 28.70 65 18.54 21.62
58 24.34 27.79 66 17.76 20.76
59 23.48 26.89 67 16.99 19.92
60 22.63 26.00 68 16.24 19.08
61 21.79 25.11 69 15.49 18.24
62 20.96 24.23 70 14.76 17.42
Table 1 – Life Expectancy Rates
Source: Australian Life Tables 2005-07
2015 SMSF Association National Conference www.smsfassociation.com
Retirement Lifestyles
Effective Earning
Rate % 1 2 3 4 5 6 7 8
Drawdown %
5% 22.43 25.80 31.00 41.04
6% 18.32 20.48 23.45 28.01 36.72
7% 15.49 16.99 18.93 21.60 25.68 33.40
8% 13.42 14.53 15.90 17.67 20.10 23.79 30.73
9% 11.84 12.69 13.72 14.99 16.62 18.85 22.23 28.55
10% 10.59 11.27 12.07 13.02 14.21 15.73 17.79 20.91
11% 9.58 10.13 10.77 11.52 12.42 13.53 14.95 16.88
12% 8.74 9.21 9.73 10.34 11.05 11.90 12.94 14.27
13% 8.04 8.44 8.88 9.38 9.95 10.62 11.43 12.42
Table 2 – How long before my savings run out?
2015 SMSF Association National Conference www.smsfassociation.com
Retirement Lifestyles
Pigeon holes: • Not enough
• Improvement
• Comfortable
2015 SMSF Association National Conference www.smsfassociation.com
Retirement Lifestyles
Time and Money Helps Hinders Supercharging Super
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options
• Grow
• Preserve
• Plan
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Growth
• Contributions
• Investment
• Borrowing
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Growth
Contributions
• Personal Injury
• CGT Cap Amounts
• Missed Contributions
• Consolidating Superannuation
• Excess Contributions
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Growth
Personal Injury
• Personal Injury • Structured Settlements
• Compensation Orders
• No Limits/Contribution Caps
• Work Test
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Growth
CGT Cap Amounts
• Small Business 15-Year Exemption
• Small Business Retirement Exemption
• Structures
• Work Test
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Growth
Investment
• Adviser Role
• Risk Profile
• Prudent Investment
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Growth
Borrowing
• Returns +/-
• Risk Profile & Prudent Investment
• Business Premises
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Preservation
• Pensions
• Costs
• Penalties
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Preservation
Pensions
• Early
• One size fits all
• Tax environments
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Preservation
Costs
• Taxation
• Documentation
• Consolidation
• Penalties
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Preservation
Penalties
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Preservation
Penalties
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Planning
• Transition to Retirement
• Insurance
• Estate Planning
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Planning Transition to Retirement
Do nothing Salary sacrifice + TRIS Package $122,000 $122,000 SG (included in package) -$10,585 -$10,585 Salary sacrifice - -$24,415 Year 1 taxable salary $111,415 $87,000 Year 1 TRIS - $19,720 Year 1 gross income $111,415 $106,720 Year 1 tax on gross income -$29,171 -$24,476 Year 1 total net income $82,244 $82,244 Balance accumulation account - end year 1 $326,847 $29,750 Balance TRIS - $301,280 Balance total super $326,847 $331,030 Difference - Year 1 - $4,183
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Planning
Insurance
• Temporary Disability
• Total and Permanent Disability
• Death
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge Options - Planning
Estate Planning ‘Lifecycle’
• Enduring Power of Attorney
• SMSF Strategies
• Equalisation of Benefit
2015 SMSF Association National Conference www.smsfassociation.com
Supercharge your Clients’ Super “How did it get so late so soon?” “Time and tide wait for no man”
2015 SMSF Association National Conference www.smsfassociation.com
Disclaimer
© Michael Harkin, Topdocs 2015
This presentation is for general information only. Every effort has been made to ensure that it is accurate, however it is not intended to be a complete description of the matters described. The presentation has been prepared without taking into account any personal objectives, financial situation or needs. It does not contain and is not to be taken as containing any securities advice or securities recommendation.
Furthermore, it is not intended that it be relied on by recipients for the purpose of making investment decisions and is not a replacement of the requirement for individual research or professional tax advice. This presentation was accompanied by an oral presentation, and is not a complete record of the discussion held. No part of this presentation should be used elsewhere without prior consent from the author.