TRADE SECRETS

May 2019 Edition

The 2019 Federal Election provided a political result that many never saw coming. Both the polls and the bookies predicted a Labor victory and if this were the case, this opening article would have taken a very different tone, considering the proposed taxation policies the Labor party described throughout the campaign. Many of you are aware of what the Labor party wanted to do, particularly around the cessation of individuals receiving cash refunds on franking credits. Over the past few months, the time the first question clients asked us, and our peers, “what does this mean for me and my retirement”?

No one asked any questions about what a Coalition government meant for them, their retirement and superannuation savings. And for an obvious reason too – very few of us expected the Coalition would hold another term in parliament. So, what changes to superannuation should we now expect from the government?

Having already dramatically changed the superannuation landscape in the 2016 Budget, there will not be any substantial changes to superannuation. Last month Prime Minister Scott Morrison promised ‘No new superannuation taxes’ (but we don’t know how long this promise will be held).

A few minor changes to superannuation have been proposed, all of which are for the positive. The previously shelved changes to Self-Managed Superannuation Funds are likely to be reconsidered, including the reintroduction of the bill to increase the number of SMSF members from four to six following the bill’s removal earlier in the year. Other election promises made by the Coalition included;

• Maintaining the more recent introduction of allowing individuals to contribute excess funds, following the sale of their home, into superannuation. We have written about the downsizer contribution rules in this Trade Secrets edition.
• Continuing to allow SMSF’s to hold non-recourse loans (primarily used for property purchases).
• Making it easier for older Australian’s to make voluntary concessional (pre-tax) and non-concessional (after-tax) contributions into superannuation by increasing the age limit from 64 years to 66 years from 1 July 2020. Currently, those aged 65 and 66 years need to meet the work test (40 hours of paid work in 30 days), before superannuation contributions, either pre or post-tax, can be made.
• Easing the rules around spouse contributions by also lifting the age of the receiving spouse. From 1 July 2020, it’s proposed that spouses receiving the contribution do not have to work if they are under age 66. Further, the government is looking at increasing the age threshold from 69 to 74. Currently, individuals have to be under 70 years of age to receive a spouse contribution.

Individuals and small and medium businesses are also beneficiaries of a Coalition government too. The current personal income tax brackets are due to change in future years. In Treasurer Josh Frydenberg’s first government budget delivered in April this year, he focused on Middle-income earners. Given the Coalition’s win, low and middle come earners are likely to receive a tax reduction of up to $1,080 (assuming the Budget is passed through government) as early as this year. The 32.5% taxation bracket (currently those on an income between $90,001 and $180,000) is proposed to decrease to 30% by 2024-25.

Small and medium businesses maintain the instant asset write-off threshold, a measure has already passed parliament and will run to 30 June 2020. It will also increase from $20,000 to $30,000 and expanded to include medium businesses with a turnover of up to $50 million.

Finally, the first home buyers will be happy. Both sides of parliament indicated they will assist this group with a new First Home Loan Deposit Scheme partnered with private lenders, will be available to first home buyers who have been able to save a deposit of at least 5%. This allows these buyers to access 95 per cent loan-to-value ratios. Further lenders mortgage insurance for these low-deposit holders is also likely to be enforced too. These measures, along with Labors proposed changes to negative gearing and capital gains tax no longer being on the table, we’re likely to see a reprieve to the falling home prices and hopefully a spur on the Australian economy.

All this aside, we expect Prime Minister Morrison has a long road ahead to get the Australian economy up and running. Both inflation and GDP growth is expected to remain around 2% for the next few years. With the financial support maintained for the strong pipeline of infrastructure projects, and a small increase in household income through reduced taxes and sweeteners for first home buyers, positives do exist. To use Morrison’s election by line, the Coalition is likely ‘to get on with the job’ of continuing to run Australian’s economy, with no upheaval. The unknown for Australia is now what happens on the international front, with the unpredictable nature of the continuing trade war between the US and China.

Rose has kindly written the article below on her family, working life and the relationship she has had with our company since 2009. We appreciate Rose’s contribution to Trade Secrets.

When Paul Nicol was initially recommended to me by my friend Campbell in 2008, I had just bought my first home in East Brunswick. At the time, I was a single woman who was working as a corporate lawyer, on a steady, moderate income. I quickly developed a fierce resolve to pay down non-tax-deductible debt! My only financial goal at that time was to pay off the mortgage on my home. The trusting relationship that I have built with Paul Nicol since then has been key to my financial confidence and independence.

Since I first engaged Paul for advice, I have built my advisory firm Worklogic set up a family trust and a Self Managed Super Fund (SMSF), and bought and successfully sold a commercial property in the Melbourne CBD which my business rented from my Family Trust. In 2007 I was married to Jeff Daniels, a New York native and documentary filmmaker. Our daughter Mia was born in 2011.

In my professional life, I run Worklogic which employs 20 people and has offices in Melbourne and Sydney. We work with Australian employers to address poor conduct in the workplace – with a focus on bullying, harassment and fraud – and to build healthy, ethical workplace cultures. We work with companies from BHP to World Vision, running training programs, settling conflict through mediation, and conducting private investigations of misconduct allegations. Together with my business partner Grevis Beard, I have published two books with international publishers – Workplace Investigations with CCH Wolters Kluver and Fix Your Team with Wiley.

I undertook the Vincent Fairfax Fellowship in Ethics and Leadership in 2009, and a Human Rights Law Fellowship with Mercy Global Action at the United Nations in New York in 2016. In addition to running Worklogic, I’m a professional Board Director at Australian Home Care Services and the Queen Elizabeth Centre. This year I was a Finalist in the Telstra Business Women’s Awards.

Being a small business owner brings some interesting challenges and opportunities, from a personal wealth perspective. Income can be variable and risks higher, with commensurate rewards. I’ve enjoyed talking with Paul as a fellow business owner. He is ambitious for my family and me, as well as what my business is achieving.

It’s clear from how Paul and the GFM team consistently operate, that they demonstrate integrity, transparency and trustworthiness. We both always act in the interests of our clients.

The practical advice that Paul has provided over the last 11 years has been invaluable – in goal-setting, our family’s financial structure, tax-related issues, and investments. Back in 2007, the most tricky question I asked Paul was whether to pay down the home loan first or contribute more to superannuation. Now we discuss Small Business CGT exemptions, Asset Allocation and SMSF governance!

Paul has also given me great practical advice on life issues like budgeting for maternity leave and taking a sabbatical in 2016. I thought Paul would tell me I was mad when I suggested taking 6-months off work to study oil painting and volunteer at the United Nations, but instead, he said ‘Go for it – life experiences like that are priceless’.

Personal finance has become a real passion for me over the last two years. Avidly consuming podcasts, Money magazine and personal finance books, I’ve built on what I’ve learned through working with Paul. Driven by my wish to provide financially for our daughter Mia, I get a real kick out of knowing what I own, what I owe, and being in the financial front seat. Working with Paul has been empowering and enriching, and I look forward to the next decade of building my financial security. Thanks to Paul, Witi, Mai and the rest of the team at GFM.

On Friday the 8th February, we celebrated at Spice Temple to acknowledge those team members that have been with the company for more than ten years. We congratulated Kushal Sharma on reaching ten years and welcomed him to the Club. Kushal is the SMSF Accountant at GFM Gruchy Accounting.

It is quite amazing to think that with 26 staff members, fifteen have now been with the company for more than ten years. We are looking forward to other staff members joining the ten year club in the next few years.

This is our 9th celebration and is an annual event. The team members are:

• Kushal Sharma – 10 years
• Jacqui Umali – 11 years
• Andrew Goldman – 11 years
• Miryam – 12 years
• Denise Slattery – 13 years
• Annie An – 13 years
• Bryan Meehan – 14 years
• James Malliaros – 17 years
• Patrick Malcolm – 17 years
• Lorraine Miller – 18 years
• Paul Nicol – 20 years
• Maree Meehan – 22 years
• Witi Suma – 22 years
• Mai Davies – 29 years
• Phil Gruchy – 41 years

We held our annual Staff Conference on Thursday 21st and Friday 22nd March in the beautiful Yarra Valley at Balgownie Estate. All our staff were in attendance, and we were blessed with beautiful weather.

Our annual Staff Conference is an opportunity for our team to get together to focus on our business plans for the coming 12 months without the distraction of our day to day office duties. Of course, we also make sure there is a fun element to the event as we rarely get the chance to socialise as a group with our busy work and family commitments.

This focus of this year’s conference was the current regulatory environment for the Financial Planning industry with several sessions devoted to how we continue to best position our business in this environment. We also allocated significant time and discussion on how we can further enhance our client’s service experience. Our team had some fantastic ideas.

A highlight of the conference was the Hot Air Balloon flight over the Yarra Valley, catching the sunrise, floating above the clouds, and enjoying the views. Here is a photo of some of the team enjoying the balloon ride.

Melany joined GFM Wealth in July 2014 as a Senior SMSF Administrator when we were still at Toorak Road. It was obvious to everyone very quickly that we had struck gold with the employment of Melany who brought with her an enormous level of SMSF knowledge combined with an incredible work ethic.

After 12 months of employment, Melany was asked to take on the role of the Senior Manager of our SMSF Accounting, Compliance and Administration team at GFM Gruchy. After the acquisition of GFM Gruchy, Melany was asked to integrate the GFM Wealth and GFM Gruchy SMSF offering allowing us to realise our long term ambition of completing SMSF Accounting in-house. This was an enormous task which Melany completed allowing us to run a scaleable SMSF offering now completing over 600 SMSF tax returns each year.

In July 2018, Melany was then promoted to the role of General Manager at GFM Wealth. After many years of significant growth at GFM, we realised it was impossible for the directors and advisers of the business to also run the business on a day to day basis. To ensure we continue to manage the growth of our business while still providing a high level of client service it was essential to have a General Manager who provided internal leadership looking at ways to improve our system and procedures, manage the growth of the business and provide strategic direction. Melany has a lot on her plate at the moment with the ever-changing regulatory landscape of Financial Services, but already Melany has been instrumental in providing strategic strength to our business.

Here’s a quick Q & A with Melany:

Q. Your family

A. Our family unit consists of my husband, Neil, and our two children, Hana, who is 17 and Angus, who is 15. Hana is currently completing her VCE-year and, despite being a little stressed, amazes me every day at how well organised and committed she is to her study-plan. Angus is in Year 10 and spends far less time with his books than with his football, but, I have faith this will change next year!

Q. Favorite holiday destination?

A. I prefer Sun over Snow, so, I like it best anywhere there is a beach and warm weather.

However, the rest of our family have a very distinct preference to ski on holidays. So, I tend to get outvoted when we chose holiday destinations. With so much to see in the world, we also try and avoid going to the same destinations any more than once, except for Germany and Japan, where my side of the family resides.

Q. Hobbies?

A. With two busy teenage children and a full-time job, sadly there is little time for hobbies. When I do get a chance to get away, I enjoy playing golf. Time permitting, one day, I would also like to take up horseback riding again, which I adored when I was a lot younger.

Q. Favorite food/drink?

A. Being half-Japanese, my favourite cuisine is from Japan, with fresh Sashimi topping the list.

Throughout my life, I have also lived in different countries including the Philippines, Indonesia, Hong Kong (China), Japan, Germany, Vietnam, the UAE and Egypt. So, any tastes from these countries bring back fond memories and are, therefore, also on my Favourite-Foods-List.

Drinks-wise, I am currently very partial to the White Negroni served at Di Stasio Citto!

Q. Your proudest moment?

A. This one is tricky to narrow down to one. Naturally, my proudest moments relate to our children, so there have to be at least two!

For our daughter, Hana, it is her completing a 3-day Solo Hike through the mountains of Victoria equipped only with her backpack, a map and a compass & with zero phone-range. For a city girl, who loves Uber, loves being social and needs her friends around at all times, this solo-achievement was incredible! Neil and I were pretty worried throughout her trekking, but so proud when she finished it!

Our son, Angus, is an avid sportsman. He recently made it into his school’s First XVIII Footy team and, being only 15; he is the youngest player to make the team. It was a pretty proud moment to see him so chuffed when he was presented his footy jumper.

Q. What sports do you follow?

A. Much to my husband’s disappointment, I don’t enjoy watching sport on TV. I do, however, enjoy watching our children participate in sport. Given our son, Angus is devoted to both AFL and Rowing, we spend the majority of our weekends at the sides of a footy ground or on the banks of a river, so I think this counts as the two sports I currently follow!

Q. Best part of working at GFM

A. I have been fortunate enough to work in different roles across both GFM Gruchy Accounting and GFM Wealth Advisory, and it is this element that I enjoy the best at GFM – the diversity and opportunities provided. We also have a fantastic team at GFM that make coming into work enjoyable each day.

Hana, Melany, Neil and Angus in Mykonos

On 14 February 2019, the Government passed legislation amending the means testing of lifetime income streams commenced on or after 1 July 2019.

The changes are intended to encourage people to use their retirement savings in a way that supports their needs and helps manage the risk of running out of money as they get older.

There is no change for account-based or marked linked income streams and lifetime annuities commenced before 1 July 2019 grandfathered under the current rules.

Annuities can be a valuable strategy for generating a reliable income to help fund your retirement. They provide a guaranteed income for life, regardless of market movements or interest rate fluctuations. There can be flexibility around withdrawal values, benefits payable on death, reversionary and beneficiary options as well as indexation. Annuities exhibit zero volatility and are issued by APRA regulated life companies. When combined with the Age Pension and other income sources, lifetime annuities can provide more certainty of having an essential level of income for life.

Regardless of how much you have saved for retirement, it is important to build a portfolio that will provides you with the best chance of your desired level of income for the rest of your life.

Means Testing

The income and assets tests assess what personal resources retirees have available to support themselves, and then calculate how much Age Pension is offered according to the lower result from the two tests.

For example, a homeowner couple can hold up to a combined $853,000 (homeowner singles $567,250) of assessable assets and generate up to $79,736 p.a. (singles $52,120 p.a.) of income and still receive a Part Age Pension.

Some assets and income receive favourable means test treatment. Your principal residence and pre-paid funerals, as examples, are fully exempt. Before 20 September 2003, some annuities were exempt from the age pension assets test. Between September 2003 and September 2007 the Centrelink asset value was assessed at 50% of the amount invested, and then for new annuities purchased from 20 September 2007 onward, the full amount of the investment was counted as an asset, with annual reductions based on life expectancy.

Proposed Changes

The new means test treatment applies to lifetime income products purchased after 1 July 2019.

For new Lifetime income streams that meet the definition of a lifetime income streams as per legislation, the new means test treatment is as follows:

• Income Test: 60% of payments as assessable income; and
• Assets Test: 60% of the purchase price as an assessable asset until age 84, or for a minimum of 5 years, and 30% after that

The proposed treatment may be beneficial where a Part Age Pension would be determined under the assets test, as up to 40% of the annuity purchase price would be immediately exempt. Part Age Pensioners in this category could achieve an increased Age Pension payment if they use part of their investable assets to purchase a lifetime income stream after 1 July 2019.

Case Study

Consider Linda and Leon (both age 66) who retired with $783,000 in an account based pension. They are balanced investors with a 60/40 growth/defensive asset allocation. They also have personal assets of $40,000. They desire $58,000 p.a. income to fund their retirement but as a minimum require $49,000 to meet needs and essentials such as food, clothing, utilities and health expenses.

They have decided to allocate $313,200 (40% of their portfolio) to a lifetime annuity from their existing account based pension to help fund their needs and wants in retirement. This also ensures they’re never solely reliant on a single source of income. The annuity has created a guaranteed income above the Age Pension in the first year of $13,189.

This lifetime annuity is a Flexible Annuity with Reducing Liquidity and has the following features for Linda and Leon:

• Provides monthly payments for life, indexed to inflation, while providing some access to capital
• Reversionary to Leon, so in the event that Linda passes away, payments will continue for Leon
• A withdrawal period of 11 years, which is half of Linda’s life expectancy. Linda and Leon have the flexibility to withdraw and be paid a lump sum if their circumstances change
• The voluntary withdrawal value reduces in a straight line from 100% of the purchase price at commencement to 0% at the end of 22 years. The voluntary withdrawal value can be impacted by changes in interest rates
• A death benefit equal to 100% of investment amount during the first 11 years, which is half of Linda’s life expectancy

The table below details Linda and Leon’s cash flow in the first year of the lifetime income portfolio (account based pension and lifetime annuity) versus only the account based pension:

	Account Based Pension	Lifetime Income Portfolio
Age Pension	$2,332	$12,121
Annuity	$ -	$13,189
Account Based Pension	$55,668	$32,690
TOTAL:	$58,000	$58,000

As a couple, it is expected that at least one of Linda and Leon will still be alive in 29 years time. There is a 75% chance one will still be alive in 24 years and a 25% chance one will still be alive in 31 years.

The chart below compares the projected annual retirement income comparison in present doillar terms based on constant (fixed) rates of return of 6.75% p.a. on growth assets and 2.75% p.a. on defensive assets, after fees and taxes, and assuming inflation of 2.5% p.a.

The cumulative total retirement income paid over 29 years has increased by $105,888 (in present dollar terms) in the lifetime income portfolio versus only the account based pension.

Because in reality investment returns are never constant, both the Account-based pension portfolio and the lifetime retirement portfolio have been stress tested using returns that change over time.

To do this, 2000 market scenarios have been modelled and analysed over 40 years (stochastic modelling). Each market scenario has different asset class returns and related market indicators such as the level of inflation. The scenarios are designed to be representative of how real-world markets could behave in the future. The stress test enables a direct comparison of how the lifetime retirement portfolio performs compared to the Account-based pension portfolio under a range of different market conditions.

The chart below summarises the results under the stress test:

	% of times ‘needs’ income of $49,000 was met		% of times ‘needs & wants’ income of $58,000 was met
	Account Based Pension	Lifetime Income Portfolio	Account Based Pension	Lifetime Income Portfolio
Couple Life Expectancy	76%	100%	74%	90%
Couple Life Expectancy plus 3 years	61%	100%	58%	83%
Couple Life Expectancy plus 6 years	46%	100%	43%	76%

As can be seen, the chance of needs ($49,000 p.a.) being met is 100% under all scenarios with the lifetime income portfolio. This is because the annuity has created a guaranteed income in addition to the age pension that meets their needs. The chance of needs and wants ($58,000 p.a.) being met to life expectancy plus six years has increased by 33%, from 43% to 76%.

Not every situation is going to be the same. There will be some scenarios where the use of an annuity will provide access to some age pension where they may have previously been locked out by the current means testing. There are also scenarios where the use of annuity is sub-optimal. Every case is different.

At GFM, our job is to analyse the personal situations of our clients to find the best combination of outcomes that is right for each one.

We will be exploring these strategies in further detail in the new Financial Year.

From 1 July 2018, superannuation legislation changed for those who are aged 65 or over and sell their principal home. These changes introduced the ability for eligible individuals to make a downsizer contribution of up to $300,000 (or $600,000 combined for a couple) into superannuation.

The downsizer contribution allows people to invest any excess proceeds from the sale of their primary residence into the concessionally taxed super environment without having to meet the work test or contribution caps.

To be eligible to make a downsizer contribution, key criteria (noted below) need to be met. The required documentation, supplied by the ATO needs to be completed and given to your superannuation fund trustee when making, or before making, the contribution.

Please note that the downsizer contribution funds still become an assessable asset under the Centrelink/DVA assets and income tests.

In addition to the required documentation, for a contribution to qualify as a downsizer contribution:

• Contracts for the sale of the main residence must have been exchanged after 1 July 2018.
• Individuals must be aged 65 or over at the time of the contribution. No other age or work tests apply.
• The contribution must be sourced from the proceeds of the sale of one main qualifying residence.
• Either you, your spouse or your former spouse (or a combination) must have had an ownership interest in the main residence for at least ten years immediately before the sale.
• The contribution into superannuation must be made within 90 days of receipt of the sale proceeds from settlement of the main residence.

Key features of the main residence:

• The property must be in Australia and includes up to two hectares of land on the same title. The sale proceeds cannot be from a caravan, houseboat or another form of mobile home.
• The downsizer contribution can only be used once, in relation to one dwelling. That is the downsizer contribution can’t apply for the sale of a second home.
• If you sell your home and are eligible, and you choose to make a downsizer contribution, there is no requirement for you to purchase another home. The $300,000 can be made up of multiple contributions, over the 90 days.

The dwelling will qualify as a ‘main residence’ for downsizer contributions if the proceeds came from a property that is:

• eligible for a full or partial CGT main residence exemption or
• would qualify for a full or partial CGT main residence exemption, except for the fact that it was acquired before 20 September 1985.

Proceeds from the sale of an investment property that is not eligible for any main residence CGT exemptions are not eligible.

The downsizer contribution cap is limited to the lesser of:

• $300,000 per person, less any downsizer contributions already made to that person’s superannuation fund from the sale of the same main residence, or
• capital proceeds received by a person (and their spouse, if relevant) from the sale of a main residence, less any downsizer contributions already made in respect of that person and their spouse (if applicable) from the sale of the same main residence.

Other points of note:

Downsizer contributions are not tax deductible. Therefore, a tax deduction on a contribution elected to be a downsizer contribution cannot be claimed.

The ability to make a downsizer contribution is not impacted by an individual’s total superannuation balance. Therefore, if a person’s total superannuation balance exceeds the $1.6 million cap, they can still make a downsizer contribution. However, once the downsizer contribution has been made, it may impact the ability to make future non-concessional contributions as it increases the future total superannuation balance.

More and more investors are seeking investment opportunities that mirror their values in respect of social and environmental issues, with a shift away from only looking at short-term returns to a broader focus on long-term value creation and the impact a company is having on the world around them.

In his 2017 letter to the CEOs of the companies his firm invests in, Blackrock CEO Larry Fink highlighted this exact issue noting that “To proposer over time, every company must not only deliver financial performance but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate”.

While terms like ethical, impact and sustainable investing are often used interchangeably, each of these terms relate to a specific type of responsible investing, depending on what the investment is trying to achieve.

Ethical investing is one of the most common investment strategies among investors, with the primary purpose of the approach to exclude specific industry sectors, companies, practices or even at times countries, based on an investor’s preference to avoid being invested in these activities.

Traditional ethical investment strategies seek to avoid issues like tobacco, weapons, gambling and pornography. However, investors are becoming increasingly interested in avoiding sectors linked to climate change or human rights issues.

Impact investing is a relatively new investment concept with the intention of investment the most pressing consideration. An impact investment should be aligned to creating a positive social or environmental impact; these cannot be a bi-product of normal business behaviour. As an example, an impact investment may target a specific issue, such as homelessness or renewable energy, or it may be more broadly themed, focusing on businesses that have a measurable social impact on a range of areas, for example, job creation or medical research.

In contrast, sustainable investing is a responsible investment strategy that considers environmental, social and governance (collectively known as ESG) issues in an investment, alongside standard financial measures when assessing a company’s performance. Questions that are considered may include a company’s employee relationship, executive remuneration and anti-money laundering legislation and how it manages issues like climate change or corruption.

As a result of investors wanting to adopt a more sustainable investment strategy, sustainable investing naturally lends itself to longer-term investment horizons and strategies, as more companies are encouraged to behave sustainably and address ESG concerns and opportunities within their business.

Many investment managers use ESG knowledge and data in their decision-making process, to help inform their analysis of risk, innovation, operating performance, competitive and strategic positioning, quality of management, corporate culture and governance. An example of this theory in practice may be assessing a company’s interaction with the environment (such as air and water pollution), social factors like employee diversity and the company’s governance such as how the board is structured and their compensation structure. The ESG approach seeks to add value and manage risks through a broader, more comprehensive investment analysis coupled with engagement with the companies being considered for investment.

While the investment opportunities available in these areas are somewhat limited at this time, there is no doubt that companies will be forced to consider their social and environmental impact on the world around them as investors become more knowledgeable and their desire to invest in line with their values grows.

We held our first seminar for the year on “Our Preferred Investments for 2019 and Why” on Wednesday 27th February at Riversdale Golf Club. This topic was extremely popular amongst our clients and their guests, with the seminar being fully booked.

The presenters on the night were GFM advisers – James Malliaros, Patrick Malcolm and Paul Nicol.

Their presentation provided an insight into how GFM Wealth selects investments, constructs portfolios, and provided information on our research and investment selection process.

The topics covered included:

• The GFM research process and investment committee
• With so many available investments, how do we filter down which companies or investments to research?
• What available tools do we (GFM) have to give us the edge when selecting investments and to construct portfolios?
• Why reliable yield is critically important to investment returns
• Constructing lower risk investment portfolios
• Our preferred investments for 2019

The feedback from attendees was positive, with 94% rating the relevance/usefulness of the topic as “Excellent”.

We concluded the evening with some drinks and canapés. Our team enjoyed the opportunity to have a drink and a chat with our clients.

We held our first Quarterly Business Lunch for the year on “Navigating the Centrelink System” on Wednesday 10th April at Leonda by the Yarra. This topic was extremely popular amongst our clients and their guests, with the session being fully booked.

The presenters on the day were GFM advisers – James Malliaros, Paul Nicol and Patrick Malcolm.

The presentation provided an overview and an understanding of the Centrelink and Age Pension System including the very significant changes over the last few years, and recently the introduction of new income and asset test assessments for lifetime income streams which commence from 1 July 2019.

The topics covered included:

• Overview of the Centrelink/DVA Age Pension
• Eligibility – Asset and Income Tests
• Deeming
• Pensioner Concession Card
• Low Income Health Card
• Commonwealth Seniors Health Card
• Case Studies
• New Means Test Treatment of Lifetime Income Streams
• The Benefits of Seeking Advice

In this edition of Trade Secrets, we have prepared a case study relating to the new means test treatment of Lifetime Income Streams.

We held our 17th Annual Golf Day at Riversdale Golf Club on Friday 29th March 2019, attended by 86 of our keen golfing clients. The day started perfectly with rain forecast for the afternoon. Although the wind picked up, we were very fortunate for the rain to have held off.

It was great to have some new players join us this year. The course was in perfect condition, and we had some terrific prizes on offer.

Congratulations to Jan Boag, Chris Boag, John Negri and Peter Bell who were our winners on the day with a score of 55.70.

The Runners-Up with a score of 56.77 were Ken Planner, Gerry Griffiths, Steve Fletcher & Jim Fuller.

The photos from the day can be found here

The SMSF Association is the peak body representing Financial Advisers, Accountants, Auditors and Trustees of the SMSF sector. We commenced membership of the SMSF Association back in 2003, and 8 of the GFM team are SMSF Association Specialist Advisers.

The Association runs an intensive three-day annual conference providing up to date SMSF legislative, taxation and estate planning training and education. This year the annual conference was in Melbourne, and all our SMSF Specialist Advisers attended. We certainly picked up lots of valuable information which will help us fine-tune our SMSF advice and service offering.

The SMSF sector is in good shape and well regulated, and continues to grow at a steady pace. We remain committed to the delivery of high-quality advice in the SMSF area.

GFM IS NOW ON LINKEDIN

GFM have recently established a company LinkedIn page, and we are posting interesting and informative content regularly. Many of our team are also on LinkedIn, and we invite you to follow GFM and connect with the team. Below is the link to our company page below. Follow us for regular updates.

Disclaimer: This document is not an offer or invitation to any person to buy or sell any interest in or deposit funds with any institution. The information here is of a generic nature, and does not take into account your investment objectives or financial needs. No person should act upon this information without firstly seeking competent professional advice specifically relating to their own particular situations.

Copyright: © This publication is copyright. Subject to the conditions prescribed under the Copyright Act, no part of it may, in any form, or by any means (electronic, mechanical, microcopying, photocopying, recording or otherwise) be reproduced or transmitted without permission. Enquiries should be addressed to GFM Wealth Advisory.