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Small steps to great success

Small steps to great success

If you want to get ahead, financially, it’s necessary to take some steps to get there. It may seem daunting and overwhelming but like anything, if you have a professional guiding you along the way, small steps can lead to something great.

Step 1: Seek advice

It’s hard to achieve great success without a team of experts behind you and your wealth is no different. Getting professional financial advice means your adviser can work through a myriad of options with you and implement a strategy aligned closely to your financial goals. Retirement planning, tax-effective super strategies, investments and estate planning? Your financial adviser can help.

Step 2: Understand what role risk plays

One of the first things your financial adviser will do is work out your risk profile, which they will check at regular review meetings. Why? Because risk is related to return, and this will help drive the recommendations they make to you in terms of your financial plan. Generally, the higher the risk, the higher the return. While some people like higher risk investments because they have the potential to deliver higher returns, others prefer less risky investments. It’s important to remember that markets are cyclical and shares are a long-term investment so if the market wobbles, your financial adviser is best placed to keep an eye on your investments and determine if they remain aligned to your overall financial strategy.

Step 3: Check your super

Your superannuation could be your largest asset, other than your own home. Given it’s such a large sum that you have been contributing to for years and years, and you are relying on it to sustain you in your retirement, isn’t it something you want to get right? Sure, it’s a long-term investment, but it’s important that it is invested in-line with your risk profile and financial goals. And you DO have options. As well as your employer contribution, you can kick in a bit extra through salary sacrificing. Contributing more to super will not only boost your account balance, it could reduce the amount of tax you pay.

Step 4: Stick to a budget

Sounds boring, right? But a budget is not boring, it’s empowering!! Setting a realistic budget helps you understand where your money is going, what can be trimmed and where you can invest to save for your future. Understanding your overall financial health and having a budget aligned to your financial goals gives you a real understanding of the benefits of working with a financial adviser. You can start to see a real change in your circumstances. Having a budget doesn’t mean giving up things you want, it just means you plan for them and you make sure you can afford them BEFORE you spend the money. Setting and sticking to a budget is really the simplest way to help you get ahead.

 

Disclaimer: The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group. They cannot be reproduced in any form without the express written consent of the author.

 

The information provided in this document, including any tax information, is general information only and does not constitute personal advice. It has been prepared without taking into account any of your individual objectives, financial situation or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information please contact our office to opt out. RI Advice Group Pty Ltd ABN 23 001 774 125 AFSL 238429
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Intergenerational Wealth Monthly Market Wrap February 2021

Vaccination rollouts en masse

  • Global shares fell 0.8% and 0.4% in hedged and unhedged terms, respectively. Global equities were influenced in part by volatility in US markets. Sizeable retail-initiated positioning in certain small stocks triggered de-leveraging (selling positions) by investors and contributed to broader market weakness. In addition, concerns additional stimulus would not be forthcoming weighed on the US market.
  • Emerging markets rose 3.7% during January outperforming developed markets. This was due to a strong bounce back by Alibaba following the reappearance of co-founder Jack Ma and removal of US delisting fears following President Biden’s inauguration.
  • Australian shares outperformed global shares rising 0.3% in January. The market was led by strength from the financial (up 2.2%) and energy (up 1.3%) sectors. Energy stocks rose in line with continued strength in oil prices as investors anticipated economic recovery (and higher oil demand) after vaccination rollout.
  • The Australian dollar (AUD) fell 0.6% against both major currencies and the US dollar.
  • Fixed income returns were negative following rising bond yields domestically and internationally. Stronger economic results with Europe for example seeing a better-than-expected decline in Q4 economic activity stoked conviction in the recovery theme.

 

As coronavirus cases slow

Globally

  • Coronavirus case growth globally appears to be materially Vaccine rollouts appear to be having an impact with the rollout in Israel performing well in protecting more vulnerable elderly victims according to the Israeli Ministry of Health.
  • We saw an orderly transition to the new Biden Administration in the US with the signing of new Executive Orders flagging a commitment to climate change policy while President Biden also signalled plans for further fiscal stimulus.

Locally

  • The RBA left interest rates on hold at 0.1% while announcing a further $100bn in bond purchases at its February meeting. This is designed to keep borrowing costs low for both governments and businesses while also maintaining downward pressure on the Australian Dollar.
  • The unemployment rate fell to 6.6% in December, pleasingly declining from 6.8% in November thanks to continued strong jobs growth.
  • Geopolitical tensions with China remained but did not accelerate in January.

 

Major asset class performance

Asset classes1 month1 year5 years (p.a.) %
%%
Australian shares0.30%-3.10%10.00%
Global shares (hedged)-0.80%10.10%12.50%
Global shares (unhedged)-0.40%0.90%11.60%
Global small companies (unhedged)2.70%6.70%12.30%
Global emerging markets (unhedged)3.70%11.60%13.20%
Global listed property (hedged)-0.50%-15.30%3.50%
Cash0.00%0.30%1.50%
Australian fixed income-0.40%1.70%4.20%
International fixed income-0.60%2.60%4.10%
Source: Bloomberg & IOOF, 31 January 2021
Indices used: Australian Shares: S&P/ASX 200 Accumulation Index, Global shares (hedged): MSCI World ex Australia Net Total Return (in AUD), Global shares (unhedged): MSCI World ex Australia Hedged AUD Net Total Return Index; Global small companies (unhedged): MSCI World Small Cap Net Total Return USD Index (in AUD); Global emerging markets (unhedged): MSCI Emerging Markets EM Net Total Return AUD Index; Global listed property (hedged): FTSE EPRA/NAREIT Developed Index Hedged in AUD Net Total Return; Cash: Bloomberg AusBond Bank Bill Index; Australian fixed income: Bloomberg AusBond Composite 0+ Yr Index; International fixed income: Bloomberg Barclays Global Aggregate Total Return Index Value Hedged AUD
Please note: Past performance is not indicative of future performance

 

Currency marks

Exchange ratesAt close on 31/11 month1 year
changechange
%%
USD/AUD0.76-0.60%14.20%
Euro/AUD0.630.00%4.40%
Yen/AUD800.70%10.40%
Trade weighted index63-0.60%8.40%
Source: Bloomberg & IOOF, 31 January 2021. All foreign exchange rates are rounded to two decimal places where appropriate.
Please note: Past performance is not indicative of future performance.
Disclaimer: This report has been prepared by the IOOF Research team for RI Advice Group Pty Ltd ABN 23 001 774 125 AFSL 238429. RI Advice Group Pty Ltd is a company within the IOOF group of companies consisting of IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. This report is current as at the date of issue but may be superseded by future publications. The information in the report may not be reproduced, distributed or published by any recipient for any purpose without the prior written consent of RI Advice Group Pty Ltd. This report may be used on the express condition that you have obtained a copy of the RI Advice Group Pty Ltd Financial Services Guide (FSG) from the website. RI Advice Group Pty Ltd and/or its associated entities, directors and/or its employees may have a material interest in, and may earn brokerage from, any securities or other financial products referred to in this report, or may provide services to the companies referred to in this report. This report is not available for distribution outside Australia and may not be passed on to any third person without the prior written consent of RI Advice Group Pty. RI Advice Group Pty and associated persons (including persons from whom information in this report is sourced) may do business or seek to do business with companies covered in its research reports. As a result, investors should be aware that the firms or other such persons may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as a single factor in making an investment decision. This report has been prepared in good faith and with reasonable care. Neither RI Advice Group Pty nor any other person makes any representation or warranty, express or implied, as to the accuracy, reliability, reasonableness or completeness of the contents of this document (including any projections, forecasts, estimates, prospects and returns and any omissions from this document). To the maximum extent permitted by law RI Advice Group Pty, its related bodies corporate and their respective officers, employees, representatives and associates disclaim and exclude all liability for any loss or damage (whether foreseeable or not foreseeable) suffered or incurred by any person acting on any information (including any projections, forecasts, estimates, prospects and returns) provided in, or omitted from this report. General Advice Disclaimer: The information in this report is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this report, you should assess your own circumstances or seek advice from a financial adviser. Where applicable, you should obtain and consider a copy of the Product Disclosure Statement, prospectus or other disclosure material relevant to the financial product before you acquire a financial product. It is important to note that investments may go up and down and past performance is not an indicator of future performance.
For information regarding any potential conflicts of interest and analyst holdings; IOOF Research Team’s coverage criteria, methodology and spread of ratings; and summary information about the qualifications and experience of the IOOF Research Team please visit https://www.ioof.com.au/adviser/investment_funds/ioof_advice_research_process.
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What financial mistakes have you made? Could they have been avoided?

What financial mistakes have you made? Could they have been avoided?

Have you made a big financial mistake in the past? One that cost you a lot of time and money to fix? One that caused you a big headache? Financial stress can be a major trigger for a lot of people, it is a big burden to carry around, but not one you need to carry alone. Speaking to a professional Financial Adviser can set your mind at ease once you have a plan in place and a financial goal to build towards.

 

Financial stress

In a report conducted by ME Bank in 2018, they found that many Australian households struggled to afford the basics:

  • 17 per cent of households could not pay utilities on time
  • 19 per cent surveyed had turned to family or friends for help
  • 15 per cent surveyed had resorted to selling items to buy necessities
  • 45 per cent of households were digging into more than 30 per cent of their disposable income to pay off the mortgage.

This can take a toll on physical and mental wellbeing.

 

The value of advice

The value of financial advice can take many forms. It could be the knowledge a professional is looking at your situation objectively, the peace of mind you get when you have a plan in place, or it could be the financial benefits you gain.

A study by CoreData for Fidelity in 2019 revealed that 88.5% of Australians receiving advice believe it gave them greater peace of mind, financially, and 86.2% of Australians receiving advice believe it gave them greater control over their financial situation.

Research by the Financial Services Council showed that people who received financial advice were almost $100,000 better off at retirement. That’s a big financial gain achieved by working with someone who provided advice and guidance around a retirement goal.

Many Financial Advisers will often tell you that it is not their clients with the highest income that are the wealthiest. The clients who get advice early in their life, work at it, and take a sensible approach are usually the wealthy – and happy – ones.

 

Don’t let a past mistake deter you from a future goal

You don’t need to be wealthy or privileged to receive financial advice. It is accessible to every day Australians who are motivated to get ahead. You can book an introductory meeting with an adviser to better understand what they do and how they can help you – and this first meeting is at no cost. You also don’t need to feel that any financial mistakes you have made in the past mean that you won’t ever get ahead. Leave your mistake in the past, and talk to an adviser about your future.

 

Talk to us

We have capacity to take on new clients and welcome the opportunity to meet with you.

 

Sources:

Intergenerational Wealth
“Building sustainable wealth for generations”.
Phone: (03) 9326 1594 or (03) 9746 7643
Email: info@igwealth.com.au
Visit: www.igwealth.com.au

This editorial and the information within, including tax, does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information please contact our office to opt out. The views expressed in this publication are solely those of the author; they are not reflective or indicative of Licensee’s position, and are not to be attributed to the Licensee. They cannot be reproduced in any form without the express written consent of the author. RI Advice Group Pty Limited ABN 23 001 774 125, AFSL 238429.
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Little by Little becomes a Lot!

“Little by Little becomes a Lot!”

OPENING SOON – Intergenerational Wealth are pleased to announce we are weeks away from moving into our new Head Office in Pascoe Vale.
Stay tuned for more progress pictures and office announcements.

Intergenerational Wealth
“Building sustainable wealth for generations”.
Phone: (03) 9326 1594 or (03) 9746 7643
Email: info@igwealth.com.au
Visit: www.igwealth.com.au

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Staying cyber safe this year 2021

Staying cyber safe this year 2021

With the increased activity online – be it due to working from home, home schooling, or simply because we have found a great availability of engaging and interesting content and streaming services, we are online a lot more and need to consider if we are adhering to safe cyber practices at home. This means having the right protective measures in place, and ensuring we are discussing safe cyber practices with other members of our household.

Did you know the average household owns 17 internet-connected devices?*
*(Telsyte Australian IoT @ Home Market Study 2018).

Top tips for staying safe online at home
• Use strong passwords and two-factor authentication
• Update your software
• Have antivirus installed
• Be careful of the information you share online that can easily identify you and be used against you
• Never click on suspicious links.

Strong passwords
A good rule of thumb for passwords is – the longer the stronger! Consider a password that contains:
• at least 8 characters (14 characters is even better!)
• at least one upper case
• one lowercase
• one numeric
• one special character (not the % sign).

When you set up a password you should avoid using details that can easily identify you – such as your own date of birth, street number, age, name etc. These are too easy to guess.

Passphrases
A passphrase is similar to a password but is often more difficult to break as it is a sentence that is unique to you but easy to remember. It is generally longer and more complex than a password and ideally contains an uppercase, symbols and punctuation.

An example of a passphrase might be your favourite meal or activity:
• OnfridaysIorderfishnchip5
• NeverStartTheDayWithoutACoff33
• Weplays0ccer0naSaturday!

Keeping our client data safe
Protecting your personal information will always be a priority for us, and we will continue to make it easier, and safer, for you to work with us. If you have any questions or concerns, please get in touch with us.

Intergenerational Wealth
“Building sustainable wealth for generations”.
Phone: (03) 9326 1594 or (03) 9746 7643
Email: info@igwealth.com.au
Visit: www.igwealth.com.au

This editorial and the information within, including tax, does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information please contact our office to opt out. The views expressed in this publication are solely those of the author; they are not reflective or indicative of Licensee’s position, and are not to be attributed to the Licensee. They cannot be reproduced in any form without the express written consent of the author. RI Advice Group Pty Limited ABN 23 001 774 125, AFSL 238429.
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Intergenerational Wealth Monthly Market Wrap January 2021

Vaccine hopes remained high

  • Global shares rose 3.4% and fell 0.5% in hedged and unhedged terms, respectively. Global equities were weighed down by a rotation into stocks that stand to benefit from coronavirus vaccine rollouts such as oil producers. By contrast names that had gained from the “working-from-home” dynamic such as video conferencing tool Zoom saw its share price fall over 29%.
  • Emerging markets rose 2.5% during December in Australian Dollar (AUD) terms outperforming developed markets.
  • Australian shares outperformed global shares rising 1.2% in December. The market was led by strength from the technology (up 9.4%) and mining (up 8.8%) sectors. Continued strength in iron ore prices following strong Chinese demand and production issues in Brazil (reducing supply) drove names such as Rio Tinto and BHP to 2020 highs.
  • The Australian dollar (AUD) continued to appreciate rising 3.1% against major currencies and 4.8% against the US dollar. Strength in commodity prices, particularly iron ore, was a key driver.
  • Fixed income returns were negative domestically but positive internationally. Long-term government bond yields rose in December as economies are anticipated to recover with coronavirus vaccine rollouts.  The Australian market is dominated by government bonds more so than the global bond market. This helped explain the relatively weak returns in the month.

 

As the vaccinations commence

Globally

  • The second wave of coronavirus cases in Europe and the US escalated further after abating during November led by a new, more infectious strain in the UK.
  • The US Electoral College formally accepted Joe Biden’s victory, paving the way to inauguration on 20 January as the new US President.
  • New US stimulus payments began to be distributed to individuals.
  • The UK exit from the EU was successfully negotiated removing another geopolitical risk from markets.

Locally

  • November jobs growth surprised on the upside with the unemployment rate falling to 6.8%, down from 7% in October.
  • Job vacancies are now exceeding pre-coronavirus levels suggesting unemployment levels will fall further.
  • NAB Business and Westpac-Melbourne Institute consumer confidence surveys remain positive suggesting consumer and investment spending will continue to recover.

Major asset class performance

Asset classes1 month
%
1 year
%
5 years (p.a.) %
Australian shares1.2%1.4%8.7%
Global shares (hedged)3.4%10.6%11.4%
Global shares (unhedged)-0.5%5.7%10.9%
Global small companies (unhedged)2.7%5.9%10.6%
Global emerging markets (unhedged)2.5%7.8%11.5%
Global listed property (hedged)2.5%-13.7%2.9%
Cash0.0%0.4%1.5%
Australian fixed income-0.3%4.5%4.6%
International fixed income0.3%5.1%4.6%
Source: Bloomberg & IOOF, 31 December 2020

 

Indices used: Australian Shares: S&P/ASX 200 Accumulation Index, Global shares (hedged): MSCI World ex Australia Net Total Return (in AUD), Global shares (unhedged): MSCI World ex Australia Hedged AUD Net Total Return Index; Global small companies (unhedged): MSCI World Small Cap Net Total Return USD Index (in AUD); Global emerging markets (unhedged): MSCI Emerging Markets EM Net Total Return AUD Index; Global listed property (hedged): FTSE EPRA/NAREIT Developed Index Hedged in AUD Net Total Return; Cash: Bloomberg AusBond Bank Bill Index; Australian fixed income: Bloomberg AusBond Composite 0+ Yr Index; International fixed income: Bloomberg Barclays Global Aggregate Total Return Index Value Hedged AUD

Please note: Past performance is not indicative of the future performance

Currency markets

Exchange ratesAt close on 31/121 month
change
%
1 year
change
%
USD/AUD0.774.8%9.6%
Euro/AUD0.632.3%0.6%
Yen/AUD79.53.7%4.2%
Trade weighted index63.43.1%5.1%
Source: Bloomberg & IOOF, 31 December 2020. All foreign exchange rates are rounded to two decimal places where appropriate.

Please note: Past performance is not indicative of future performance.

Disclaimer: This report has been prepared by the IOOF Research team for RI Advice Group Pty Ltd ABN 23 001 774 125 AFSL 238429. RI Advice Group Pty Ltd is a company within the IOOF group of companies consisting of IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. This report is current as at the date of issue but may be superseded by future publications. The information in the report may not be reproduced, distributed or published by any recipient for any purpose without the prior written consent of RI Advice Group Pty Ltd. This report may be used on the express condition that you have obtained a copy of the RI Advice Group Pty Ltd Financial Services Guide (FSG) from the website. RI Advice Group Pty Ltd and/or its associated entities, directors and/or its employees may have a material interest in, and may earn brokerage from, any securities or other financial products referred to in this report, or may provide services to the companies referred to in this report. This report is not available for distribution outside Australia and may not be passed on to any third person without the prior written consent of RI Advice Group Pty. RI Advice Group Pty and associated persons (including persons from whom information in this report is sourced) may do business or seek to do business with companies covered in its research reports. As a result, investors should be aware that the firms or other such persons may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as a single factor in making an investment decision. This report has been prepared in good faith and with reasonable care. Neither RI Advice Group Pty nor any other person makes any representation or warranty, express or implied, as to the accuracy, reliability, reasonableness or completeness of the contents of this document (including any projections, forecasts, estimates, prospects and returns and any omissions from this document). To the maximum extent permitted by law RI Advice Group Pty, its related bodies corporate and their respective officers, employees, representatives and associates disclaim and exclude all liability for any loss or damage (whether foreseeable or not foreseeable) suffered or incurred by any person acting on any information (including any projections, forecasts, estimates, prospects and returns) provided in, or omitted from this report. General Advice Disclaimer: The information in this report is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this report, you should assess your own circumstances or seek advice from a financial adviser. Where applicable, you should obtain and consider a copy of the Product Disclosure Statement, prospectus or other disclosure material relevant to the financial product before you acquire a financial product. It is important to note that investments may go up and down and past performance is not an indicator of future performance.
For information regarding any potential conflicts of interest and analyst holdings; IOOF Research Team’s coverage criteria, methodology and spread of ratings; and summary information about the qualifications and experience of the IOOF Research Team please visit https://www.ioof.com.au/adviser/investment_funds/ioof_advice_research_process.
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Intergenerational Wealth Monthly Market Wrap December 2020

Market wrap December 2020

Welcome to the latest edition of our client newsletter. Our articles cover a range of topics which we hope you will find interesting. We aim to keep you informed of changes as they happen, but we also want to provide ideas to help you live the life you want, now and in the future.

Vaccine hopes surged

  • Global shares rose 7.7% and 12.2% in hedged and unhedged terms, respectively. Global equities were led on the upside by European equities with the German market up 15% and the French rising 20.1%, both in local currency terms. Positive vaccine trial results from the likes of Moderna and Pfizer were the major catalysts promising a closer end to the coronavirus pandemic.
  • Emerging markets rose 5.9% during November in Australian Dollar (AUD) terms lagging developed markets. This was due in part to underperformance by index heavyweight Alibaba which withdrew the planned listing of its subsidiary Ant Financial after a fierce regulatory backlash.
  • Australian shares outperformed global shares rising 10.2% in November. The market was led by strength from the energy (up 28.4%) and financial (up 15.2%) sectors. Energy stocks rose investors anticipated economic recovery (and higher oil prices) on vaccine news.
  • The Australian dollar (AUD) bounced back sharply rising 3.4% against major currencies and 4.5% against the US dollar.
  • Fixed income returns were flat domestically but positive internationally. Despite support from the RBA rate cut domestically this was more than swamped by the surge in “risk on” sentiment which benefited non-government bonds (that carry the risk of bankruptcy). The Australian market is dominated by government bonds more so than the global bond market. This helped explain the relatively weak returns in the month.

 

As trials deliver promising results

Globally

  • The second wave of coronavirus cases in Europe and the US appears to be abating with case growth falling from peak levels in recent weeks.
  • President Trump appears ready to allow an orderly transition to President elect Joe Biden, countering fears of a prolonged election battle with the Trump campaign failing to successfully contest the election.

 Locally

  • The RBA cut interest rates by 0.15% to a new low of 0.1% in part to reduce pressure on the AUD. This effort was thwarted by vaccine trial success that stoked optimism over stronger global growth and demand for Australian resources.
  • Geopolitical tensions with China intensified following an airing of grievances against Australia and punitive tariffs on Australian wine exports, hurting businesses such as Penfolds producer, Treasury Wine Estates.
  • Business surveys pointed to a bounce back in economic activity overall as Melbourne exited lockdown restrictions.

Major asset class performance

Asset classes1 month
%
1 year
%
5 years (p.a.) %
Australian shares10.2%-2.0%9.1%
Global shares (hedged)12.2%10.0%10.3%
Global shares (unhedged)7.7%5.6%10.6%
Global small companies (unhedged)11.2%3.8%9.5%
Global emerging markets (unhedged)5.9%10.6%10.7%
Global listed property (hedged)11.7%-16.1%2.5%
Cash0.0%0.4%1.6%
Australian fixed income-0.1%3.0%4.7%
International fixed income0.5%4.5%4.5%
Source: Bloomberg & IOOF, 30 November 2020

Indices used: Australian Shares: S&P/ASX 200 Accumulation Index, Global shares (hedged): MSCI World ex Australia Net Total Return (in AUD), Global shares (unhedged): MSCI World ex Australia Hedged AUD Net Total Return Index; Global small companies (unhedged): MSCI World Small Cap Net Total Return USD Index (in AUD); Global emerging markets (unhedged): MSCI Emerging Markets EM Net Total Return AUD Index; Global listed property (hedged): FTSE EPRA/NAREIT Developed Index Hedged in AUD Net Total Return; Cash: Bloomberg AusBond Bank Bill Index; Australian fixed income: Bloomberg AusBond Composite 0+ Yr Index; International fixed income: Bloomberg Barclays Global Aggregate Total Return Index Value Hedged AUD

Please note: Past performance is not indicative of future performance.

Currency markets

Exchange ratesAt close on 30/111 month
change
%
1 year
change
%
USD/AUD0.734.5%8.6%
Euro/AUD0.622.0%0.3%
Yen/AUD76.64.1%3.5%
Trade weighted index61.53.4%4.2%
Source: Bloomberg & IOOF, 30 November 2020. All foreign exchange rates are rounded to two decimal places where appropriate.

Please note: Past performance is not indicative of future performance.

Disclaimer: This report has been prepared by the IOOF Research team for RI Advice Group Pty Ltd ABN 23 001 774 125 AFSL 238429. RI Advice Group Pty Ltd is a company within the IOOF group of companies consisting of IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. This report is current as at the date of issue but may be superseded by future publications. The information in the report may not be reproduced, distributed or published by any recipient for any purpose without the prior written consent of RI Advice Group Pty Ltd. This report may be used on the express condition that you have obtained a copy of the RI Advice Group Pty Ltd Financial Services Guide (FSG) from the website. RI Advice Group Pty Ltd and/or its associated entities, directors and/or its employees may have a material interest in, and may earn brokerage from, any securities or other financial products referred to in this report, or may provide services to the companies referred to in this report. This report is not available for distribution outside Australia and may not be passed on to any third person without the prior written consent of RI Advice Group Pty. RI Advice Group Pty and associated persons (including persons from whom information in this report is sourced) may do business or seek to do business with companies covered in its research reports. As a result, investors should be aware that the firms or other such persons may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as a single factor in making an investment decision. This report has been prepared in good faith and with reasonable care. Neither RI Advice Group Pty nor any other person makes any representation or warranty, express or implied, as to the accuracy, reliability, reasonableness or completeness of the contents of this document (including any projections, forecasts, estimates, prospects and returns and any omissions from this document). To the maximum extent permitted by law RI Advice Group Pty, its related bodies corporate and their respective officers, employees, representatives and associates disclaim and exclude all liability for any loss or damage (whether foreseeable or not foreseeable) suffered or incurred by any person acting on any information (including any projections, forecasts, estimates, prospects and returns) provided in, or omitted from this report. General Advice Disclaimer: The information in this report is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this report, you should assess your own circumstances or seek advice from a financial adviser. Where applicable, you should obtain and consider a copy of the Product Disclosure Statement, prospectus or other disclosure material relevant to the financial product before you acquire a financial product. It is important to note that investments may go up and down and past performance is not an indicator of future performance.
For information regarding any potential conflicts of interest and analyst holdings; IOOF Research Team’s coverage criteria, methodology and spread of ratings; and summary information about the qualifications and experience of the IOOF Research Team please visit https://www.ioof.com.au/adviser/investment_funds/ioof_advice_research_process.
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inTouch Magazine Q4 2020

inTouch Magazine Q4 2020

Welcome to our quarterly magazine in this edition:

• Federal Budget summary
• Nominating your super beneficiary
• Cyber security – keeping your personal information safe
• Why insurance matters
• Understanding the 2020 lingo
• Season’s Greetings from all of us

inTouch magazine | Q4 2020

Please note: inTouch and informtion in this editorial is of a general nature only and neither represents nor is intended to give specific advice on any particular matter. This publication does not contain tax advice and it is recommended that you speak with a tax specialist about your circumstances. We strongly suggest that no person should act specifically on the basis of information contained herein but should obtain appropriate professional advice on their own personal circumstances. The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice’s position and are not to be attributed to RI Advice. They cannot be reproduced in any form without the express written consent of the author. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information please contact our office to opt out. Materials are published by RI Advice Group Pty Ltd. ABN 23 001 774 125 AFSL 238429. The information in this publication is current as of October 2019.
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Intergenerational Wealth Monthly Market Wrap November 2020

Pandemic concerns reappear…

  • Global shares fell -3.2% and -1.1% in hedged and unhedged terms, respectively. Global equities were led on the downside by both US and European equities with the German market down over -9.4%.
  • Emerging markets rose 4.2% during September in Australian Dollar (AUD) terms with the Chinese market performing strongly whilst other developing economies such as India continue to see slowing coronavirus case growth.
  • Australian shares outperformed global shares rising 1.9% in October. The market was led by strength from the banking (Financials up 6.3%) and tech sectors (up 8.96%).
  • The Australian dollar (AUD) acted as a buffer falling -2% against major currencies and -1.9% against the US dollar.
  • Fixed income returns were positive domestically but flat internationally. Speculation over another RBA rate cut, and additional quantitative easing was an important support. Rising US bond yields following a strong GDP result drove the flat outcome for global bonds even as corporate bonds had positive returns.

 

As cases escalated in Europe

Globally

  • The continued pace of cases in Europe accelerated further and triggered new lockdown restrictions across France, Germany and other major countries. This raised the risk of another quarter of negative growth in Europe.
  • US case growth also accelerated prompting renewed calls for further government stimulus.
  • President Trump appears to have been defeated in the 2020 US Presidential election by Democrat nominee Joe Biden.

Locally

  • The Federal Budget for FY21 was well received with consumer confidence bouncing strongly on the back of tax cuts being brought forward.
  • The RBA cut interest rates by 0.15% to a new low of 0.1% and announced further extension of its bond purchasing program intended to drive long-term borrowing costs lower and help reduce the attractiveness of our currency (by reducing the difference between our bond yields and other countries).
  • It appears that the September quarter this year was the end of the Australian recession with positive growth likely to be recorded as the relaxation of lockdowns across the country saw consumer spending recover (on a volume basis) while government stimulus in JobKeeper and JobSeeker remained supportive though tapering began in October).

Major asset class performance

Asset classes1 month
%
1 year
%
5 years (p.a.) %
Australian shares1.9%-8.1%6.8%
Global shares (hedged)-3.2%1.1%8.0%
Global shares (unhedged)-1.1%2.7%8.5%
Global small companies (unhedged)2.1%-1.9%7.1%
Global emerging markets (unhedged)4.2%6.2%8.3%
Global listed property (hedged)-3.4%-25.5%0.0%
Cash0.0%0.5%1.6%
Australian fixed income0.3%4.0%4.5%
International fixed income0.0%3.8%4.4%
Source: Bloomberg & IOOF, 31 October 2020

Indices used: Australian Shares: S&P/ASX 200 Accumulation Index, Global shares (hedged): MSCI World ex Australia Net Total Return (in AUD), Global shares (unhedged): MSCI World ex Australia Hedged AUD Net Total Return Index; Global small companies (unhedged): MSCI World Small Cap Net Total Return USD Index (in AUD); Global emerging markets (unhedged): MSCI Emerging Markets EM Net Total Return AUD Index; Global listed property (hedged): FTSE EPRA/NAREIT Developed Index Hedged in AUD Net Total Return; Cash: Bloomberg AusBond Bank Bill Index; Australian fixed income: Bloomberg AusBond Composite 0+ Yr Index; International fixed income: Bloomberg Barclays Global Aggregate Total Return Index Value Hedged AUD

Please note: Past performance is not indicative of future performance

 

Currency markets

Exchange ratesAt close on 31/101 month
change
%
1 year
change
%
USD/AUD0.70-1.9%1.9%
Euro/AUD0.60-1.2%-2.4%
Yen/AUD73.6-2.6%-1.2%
Trade weighted index59.5-2.0%-0.8%
Source: Bloomberg & IOOF, 31 October 2020. All foreign exchange rates are rounded to two decimal places where appropriate.

Please note: Past performance is not indicative of future performance.

Disclaimer: This report has been prepared by the IOOF Research team for RI Advice Group Pty Ltd ABN 23 001 774 125 AFSL 238429. RI Advice Group Pty Ltd is a company within the IOOF group of companies consisting of IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. This report is current as at the date of issue but may be superseded by future publications. The information in the report may not be reproduced, distributed or published by any recipient for any purpose without the prior written consent of RI Advice Group Pty Ltd. This report may be used on the express condition that you have obtained a copy of the RI Advice Group Pty Ltd Financial Services Guide (FSG) from the website. RI Advice Group Pty Ltd and/or its associated entities, directors and/or its employees may have a material interest in, and may earn brokerage from, any securities or other financial products referred to in this report, or may provide services to the companies referred to in this report. This report is not available for distribution outside Australia and may not be passed on to any third person without the prior written consent of RI Advice Group Pty. RI Advice Group Pty and associated persons (including persons from whom information in this report is sourced) may do business or seek to do business with companies covered in its research reports. As a result, investors should be aware that the firms or other such persons may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as a single factor in making an investment decision. This report has been prepared in good faith and with reasonable care. Neither RI Advice Group Pty nor any other person makes any representation or warranty, express or implied, as to the accuracy, reliability, reasonableness or completeness of the contents of this document (including any projections, forecasts, estimates, prospects and returns and any omissions from this document). To the maximum extent permitted by law RI Advice Group Pty, its related bodies corporate and their respective officers, employees, representatives and associates disclaim and exclude all liability for any loss or damage (whether foreseeable or not foreseeable) suffered or incurred by any person acting on any information (including any projections, forecasts, estimates, prospects and returns) provided in, or omitted from this report. General Advice Disclaimer: The information in this report is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this report, you should assess your own circumstances or seek advice from a financial adviser. Where applicable, you should obtain and consider a copy of the Product Disclosure Statement, prospectus or other disclosure material relevant to the financial product before you acquire a financial product. It is important to note that investments may go up and down and past performance is not an indicator of future performance.
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The value of having a financial adviser

Having an appropriate financial plan in place covers more than just investments and insurance. The same goes for a financial adviser – there are some you will just click with, who you will feel comfortable opening up to and working with over the long term, to improve your financial future.

 

You’re better off

Research by the Financial Services Council showed people who received financial advice were almost $100,000 better off at retirement1. That’s a big difference and could mean you are financially more comfortable for more retirement years.

Further studies by CoreData for Fidelity in 2019 revealed that 88.5% of Australians receiving advice believe it has given them greater peace of mind financially and 86.2% of Australians receiving advice believe it has given them greater control over their financial situation.

 

Keep on track

Over the long term investment markets tend to fluctuate. This can be difficult for some people, as they worry about whether they will have enough money for their goals- like renovating the home, international travel, or saving for a comfortable retirement. A concern may be whether to make adjustments now, to fund a better financial future.

Having an experienced financial adviser to help you structure your investment portfolio, based on your age and risk tolerance, will help you ride out any ups and downs.

Working with a financial adviser who understands you and your situation means they will look for opportunities for you, and make ongoing recommendations and changes to your plan. If you get worried about something, having an adviser to remind you about your long term financial strategy will help you see that short-term volatility is just part of your long term financial journey.

 

Stay protected

While you may already have some form of insurance in place, perhaps through your employer or super fund, do you really know how much you have and what it covers? Is it sufficient? What would be the financial impact if you were unable to work for extended period due to illness or injury? Reviewing insurance is one of those things that if delayed, the risks can get larger and larger.

An experienced financial adviser will be able to explain exactly what you are covered for, identify any gaps and recommend changes, so your future is protected and you can rest easy.

 

Realise your potential

To help you reach your full financial potential, an experienced financial adviser can discuss a wide range of financial topics. While there’s no doubt that investments and insurance are important when building your wealth, so too is managing your cashflow, budgeting, tax planning, transitioning to retirement, aged care and estate planning.

Seeking professional advice on your whole financial situation can go a long way to helping you make the most of what you have, whatever your age or income.

 

The comfort of having a professional financial adviser

Taking the time to find an experienced, professional financial adviser who makes you feel comfortable and at ease so you can have peace of mind when it comes to your financial future makes good sense.

As we say goodbye to a challenging 2020, let’s look forward to a brighter 2021. If your finances were hit with the full force of COVID-19, we can help get you back on track. We have capacity to take on new clients, so if this article is of interest to you, your friends or your family, we would love the chance to discuss them further.

Sources:
1The ‘Better off with savings advice’, 16 February 2011, research shows that a 30 year old would save an additional $91,000, a 45 year old would save an additional $80,000 and a 60 year old would save $29,000 more than those without a financial adviser.
2 https://www.fidelity.com.au/insights/investment-articles/the-value-of-advice/
This editorial and the information within, including tax, does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information please contact our office to opt out. The views expressed in this publication are solely those of the author; they are not reflective or indicative of Licensee’s position, and are not to be attributed to the Licensee. They cannot be reproduced in any form without the express written consent of the author. RI Advice Group Pty Limited ABN 23 001 774 125, AFSL 238429.
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