Quarterly Newsletter October to December 2006

Thu Jan 18 2007

Merry Christmas from the team at Spectrum!

It?s hard to believe the silly season is upon us again. This year has seen some dramatic changes in our economy; namely superannuation reform and interest rate rises.

This quarter, we look at the five biggest mistakes of self managed superannuation fund trustees, we look at how to start the savings habit, give an economic update and we tell you which of our staff members is off to South Africa to represent  Australia in touch football.

From the Management and team at Spectrum Financial Partners, we wish you and your families a Merry Christmas and a prosperous New Year. We look forward to being of service to you in 2007!

 
Spectrum will be closed
       from Friday 22nd
     December and will
    re-open on Monday
     8th January 2007

--------------------------------------------------------------------

2006 Tax Deadlines Fast Approaching!

We would like to thank the majority of our clients for bringing in your information for earlier lodgement and management of your tax affairs. For those who have not already done so, we urge you to review your 2006 information over the holidays and drop them in early in January 2007 so we can schedule the completion and lodgement of your work by the due dates. 

----------------------------------------------

Starting the Savings Habit

It is about this time of year that many teenage children enter the workforce for the first time in a serious way. Whether it is a holiday job or entering the workforce for the first time after completing school or tertiary studies, it is a time of uncertainty and adventure.

All of a sudden these children are now adults and are finding themselves with surplus cash to do whatever they like with. This is the time for some sensible savings habits to be established. 

Back in the 1950?s George S Glason published ?The Richest Man in Babylon?. One of the simple messages from this book is to save 10% of what you earn. For our children who are now entering the workforce, have them arrange for 10% of their pay to be diverted to a high interest, low fee savings account.

Once they build up savings of $1000 or so, it can then be invested in a managed fund or perhaps some quality direct shares. The earlier we start the savings process, the easier it is to adjust to having less income to live on. It is amazing at just how quickly our savings can grow. In the fullness of time, these accumulating savings, wisely invested, will generate additional income that will allow us to afford an even better lifestyle than if we just spend everything we get paid.

Add a copy of ?The Richest Man in Babylon? to your teenage or your adult?s Christmas stocking!

Source: Peter Kelly - Professional Investment Services

-------------------------------------------------

Economic Update

The Reserve Bank of Australia (RBA)?s delivered the widely expected 0.25% interest rate increase in early November which marks the third increase in six months and the eighth such move over a lengthy four year period. There is now (finally) some evidence that the May and August rate hikes are starting to have an effect, with retail sales quite soft in September (rising by just 0.1%), and growth in both housing and personal credit starting to moderate. Similar to the previous two moves, the RBA should take time to watch for the impact of the November rate hike over the coming months. With growth figures starting to slow and with the impact of the drought to contend with, the November rate hike may well be the last of the current cycle?.

Source: Mark Teale - Professional Investment Services

 -------------------------------------------------------       

Press ReleaseThe Five Biggest Mistakes of Self-Managed Super Fund Trustees that Cost their Families Dearly
SYDNEY, NSW, FEBRUARY 27 2006:

 

Self Managed Superannuation funds hold more than $180 billion in assets - 24% of all superannuation fund assets. However, the individuals that start these funds to control their superannuation investments make five big mistakes. Mistakes that cost them not only in terms of their retirement income but also may mean imprisonment.

There are five big mistakes made by trustees of self managed superannuation funds according to Grant Abbott, Principal of SMSF Strategies, a leading Australia SMSF adviser and author of the CCH publication; ?Guide to SMSF?s?.  Those five big mistakes are:

1. Thinking that you can use the fund for your own financial gain before you are allowed under the law.

2. Not taking time to manage the fund?s investments. Not only is this required by law but less time means less returns and less retirement income.

3. Not getting a set of fund rules that they can read and understand. Many of the transactions that the member trustees undertake are prevented by their own rules - the one?s that they put in place but never read.

4. Not putting in place an estate plan for the family of the fund.

Superannuation is not part of the Will and to many dependents surprise, the remaining trustees can take all of the deceased member?s super.

5. Not having a specialist SMSF adviser. The rules relating to trustees are complex and many accountants and financial planners working on funds are not specialists and in some cases not licenced to give advice.

?If you make even one of these mistakes then it can have a serious impact on your retirement income?, says Abbott, ?but make two or more, get caught, and that can see it all gone?.

Please contact the team at Spectrum to review your Self-Managed Superannuation Fund needs, or to discuss your personal superannuation.

-------------------------------------

 

Don?t forget about our great business
            tools on our website at www.spectrumfp.com.au
         Password: Specmem

or pop in to the Spectrum office for a
            free hard copy version!

 

----------------------------------------------

 Spectrum employee
to represent Australia!

Supervisor Nathan Jones is off to Stellenbosch, South Africa to represent Australia at the Touch World Cup. Nathan will play in the Open Mens Touch team in the tournament, which will run from 17-21 January 2007. There are currently 56 teams entered from 18 countries, and this tournament is considered the pinnacle of international touch football.  We wish Nathan the best of luck, and we are sure he will do Australia proud!

------------------------------------------------------

Trivia - Fabulous Facts

Q1. Australians hold the world record for which amazing feat?

a) Fastest beer bottle opening
b) Largest Christmas Cracker
c) Most sheep sheared in 24 hours
d) Largest chicken dance

Q2. Approximately how many rabbits are there in Australia today?

a) 3 million
b) 30 million
c) 300 million
d) 3,000 million

Q3. Which of the following in not an Australian innovation?

a) Chiko roll
b) Lawn sprinkler
c) Plastic bank notes
d) Dual flush toilet
e) Wine cask

Answers:
1) B - Largest Christmas Cracker
2) C - 300 million
3) B - Lawn SprinklerTax

-----------------------------------------------------

Show Me The Money!

Are you cash flow poor? Do you want to know where your cash is going and how to improve your business cash flow?

If you answered ?yes? to the questions above, please don?t hesitate to call Spectrum Accountants on
1300 55 65 35 to arrange an appointment today!

--------------------------