Financial Planners

[robots]

ROFL!!!

This from a Real Estate Agent!!

hello,

ah yes but a "re agent" wont get you to invest in dodgy mezzanine companies will they?

they are selling you a title and at initial purchase you pay not one fee,

thankyou

robots

 

[tech/a]

Builder---someone mentioned Builder.

Well thats my lot---add some developement in there as well.
Already told my story once.
Invested (wasted ) $1000 on 2 "Highly recommended" financial Planners.

Their advice was pure rubbish.

(1) Invest $58k a year in Super---If I cant have my $58K do better than a managed fund I'll go he!
(2) Diversification into a number of various funds---basically the same as (1) with a twist.

Could they outperform my own returns over the last 5 yrs----urrr no!
Could they keep up with them----urrr no!
Could they get close to them----urrr no--

When it comes to creating Real wealth they really dont have any more answers than Builders---Infact less.

The best result I have found is a partnership.

I make it and my CPA makes sure I keep as much of it as possible.

 

[Julia]

Their advice was pure rubbish.

(1) Invest $58k a year in Super---If I cant have my $58K do better than a managed fund I'll go he!

Tech, Super is simply the vehicle for investing in whatever you choose.
It's not something you invest in of itself. Investing in managed funds is a separate matter.

The obvious advantage of having investments of whatever variety in Super is the tax advantage, i.e. only 15%.

So, on the basis that you would be in the highest tax bracket, the financial planner's suggestion of putting some funds into investments under the umbrella of Super would appear to be pretty reasonable.

 

[tech/a]

Tech, Super is simply the vehicle for investing in whatever you choose.
It's not something you invest in of itself. Investing in managed funds is a separate matter.

The obvious advantage of having investments of whatever variety in Super is the tax advantage, i.e. only 15%.

So, on the basis that you would be in the highest tax bracket, the financial planners suggestion of putting some funds into investments under the umbrella of Super would appear to be pretty reasonable.

Let me then qualify the Pure rubbish statement then.

Firstly they find out what time you have breakfast,and with this copious amount of information pigeon hole you into type of investor THEY think you are or should be.

So they know where you've come from--Financially.

If I have $58k a year surplus then it would be reasonable to assume,I can generate income from investment---they KNOW I can and spent masses of paper to find out.

They know my return on Trading/Property/Development/and business.
Yet all they can come up with is SUPER---wow ----does commission fees and servicing ring a bell?

Super is the biggest con in Australia today.
Soon as funds are in Super that's it you cant use them until you retire.
If the government were serious about people being self funded they wouldn't have ANY tax on super savings.They'd allow broader usage of funds.Theyd allow creation of genuine wealth---but no they are greedy---they want both--tax and self funded retirees.

What could/do I do with that $58k a year surplus?
(1) Buy another excavator to add to the fleet---nett $50/hr average 37hrs a week.
(2) Add another $120K to the margin account Even with my tax rate I'll out perform any managed fund.---well 99% of them.
(3) Use the funds to service a carving up of a 1200 meter house block to 3 400 meter development blocks.Doubling investment in 12 mths with ease.
Even in these "depressed times".
(4) Service a duplex development.

I sit there at the second interview and go through these and many more looking at these Experts and I get---blank stupid looks.---Financial planners---plan what!

What do I do for super?
I have one investment only.
My business warehouse and property,in my SMSF created in 2005 through to 2007 taking advantage of the bulk funding opportunity's tax savings I couldn't ignore nor the Rent!
Having these funds tied up has been at a cost---one went by which I couldn't fund due to so much being tied up in the SMSF---wasn't recognised.
It was/is an industrial subdivision which would have doubled my investment---sadly for me someone else is doing this now!.

Still it was a decision I made---who's Idea?
CPA.

By the way retirement scares me to death.

 

[theasxgorilla]

Super is the biggest con in Australia today.
Soon as funds are in Super that's it you cant use them until you retire.
If the government were serious about people being self funded they wouldn't have ANY tax on super savings.They'd allow broader usage of funds.Theyd allow creation of genuine wealth---but no they are greedy---they want both--tax and self funded retirees.

Thats a big statement. As a tax advantaged way of investing for and funding ones retirement I actually thought the current Australian super arrangements were pretty darn good.

 

[Macquack]

Did I say I wanted a pat on the back.

What is fair and reasonable, charging someone $30,000 for a deck or extension which you make $20,000. Is that reasonable Mr Builder. I estimate my time to precision on the jobs that I do. My hourly rate is $200 but I reckon yours is much higher.

Have I seen you contribute to threads in this website in a positive and constructive way and provide information consistently that others here would not know. I guess being a builder gives you an opportunity to tell others about all of the super rules doesn't it.

Then again if you made an appointment to see me I would not keep you waiting but if you were to come round to give me a quote on a job I would still be waiting. Now there are some generalisations for ya!!!

Not one of you best posts, TheRage.

 

[tech/a]

Thats a big statement. As a tax advantaged way of investing for and funding ones retirement I actually thought the current Australian super arrangements were pretty darn good.

Yes let me explain.

I remember one poster here Kris who placed everything he could get his hands on into super.
I find this tragic---why.

Well once your disposable savings are in super particularly at a young age they cant be accessed for years. Your basically living from day to day until you can access your savings.
Now how they perform relative to inflation over those years is beyond your control. I'll bet there are many here who have been in super (not their own funds) who are disillusioned by fees and poor performance.

Anyway back to my point.
Kris didn't have any spare funds then to take advantage of any entrepreneurial opportunities that came his way.
Lets say he wanted to start or buy a business---no funds all in super.
Lets say he wanted to take part in the last or any future property Appreciation---cant do no funds all in super.
Lets say he became a very good trader---no good no funds all in super.

Thats why its a con.
This tax saving deludes people into the be all and end all of investment strategies.
The tragedy is that
A--they are leaving their future to others.
B--The cannot take advantage of their capital.
C--- by the time they realise it its too late.

Money does unfortunately make money and if you have it countless opportunities present themselves---without it you look on in wonder and sometimes regret---as I did.

happy to be convinced otherwise.

 

[Temjin]

Yes let me explain.

I remember one poster here Kris who placed everything he could get his hands on into super.
I find this tragic---why.

Well once your disposable savings are in super particularly at a young age they cant be accessed for years. Your basically living from day to day until you can access your savings.
Now how they perform relative to inflation over those years is beyond your control. I'll bet there are many here who have been in super (not their own funds) who are disillusioned by fees and poor performance.

Anyway back to my point.
Kris didn't have any spare funds then to take advantage of any entrepreneurial opportunities that came his way.
Lets say he wanted to start or buy a business---no funds all in super.
Lets say he wanted to take part in the last or any future property Appreciation---cant do no funds all in super.
Lets say he became a very good trader---no good no funds all in super.

Thats why its a con.
This tax saving deludes people into the be all and end all of investment strategies.
The tragedy is that
A--they are leaving their future to others.
B--The cannot take advantage of their capital.
C--- by the time they realise it its too late.

Money does unfortunately make money and if you have it countless opportunities present themselves---without it you look on in wonder and sometimes regret---as I did.

happy to be convinced otherwise.

So what are your suggestions to the million other Australians who does not know ANYTHING about saving/investing for their retirement and does not possess the knowledge / experiences to do so? Do it yourself? But what if these million Australians are too busy with their life to learn about building wealth, or have absolute no interest in such topic?

All the anti-FP comments that I generally hear usually comes down to two things. I know how to manage my wealth and invest better than the recommendations from FPs. And that the FPs are acting in their own interest for commissions only.

And for the super part, at least I agree that it is pointless for those who are still relatively young. In fact, the study materials actively discourage such strategies! (yes, it's from the first module as well!) Any FPs who hard sell super products to these young people are definitely acting in their own interest only. So I can't blame those who are pissed off with it.

 

[tech/a]

So what are your suggestions to the million other Australians who does not know ANYTHING about saving/investing for their retirement and does not possess the knowledge / experiences to do so? Do it yourself?

Yes absolutely take the time and effort IF you have an interest in your financial future to become experienced enough to take control of your life financially.

But what if these million Australians are too busy with their life to learn about building wealth,

I would suggest that if they're "Too Busy" Then they either have no interest in future financial security or are locked into the financial merry go round which they actually seek to get off.
Doing the same thing day in day out expecting a DIFFERENT result!

or have absolute no interest in such topic?

They have no need for the likes of me or an F/P.

All the anti-FP comments that I generally hear usually comes down to two things. I know how to manage my wealth and invest better than the recommendations from FPs. And that the FPs are acting in their own interest for commissions only.

Their recommendations are at best mediocre is another
They are so hog tied by possible litigation that they cannot advise outside of a very closed circle even if they could or wanted to.---is another.
They have (in the most part) no practical experience beyond what they learn from Industry experts---

And for the super part, at least I agree that it is pointless for those who are still relatively young. In fact, the study materials actively discourage such strategies! (yes, it's from the first module as well!) Any FPs who hard sell super products to these young people are definitely acting in their own interest only. So I can't blame those who are pissed off with it.

And the advice for these people is?

 

[TheRage]

Not one of you best posts, TheRage.

Why not? Where is your pithy reply. My original point was not to cast everyone with the same brush becasue people are crooks in ever industry including yours Mr Builder. People always talk about Financial planners putting them into Westpoint or Fincorp. Guess what Lawyers and Accountants also got involved in these little treasures. For the record I did not just have a dig at accountants or lawyers I am merely pointing out that all industries have crooks.

 

[TheRage]

Tech,

I respect your technical charting experience but I think your personal experiences regarding financial planners have clouded your judgement on this one.

Superannuation as Julia said is an investment vehicle. If a planner wants you to make a 100,000 concessional contribution each year to super it is so that you can get a full deduction on this amount and apply it to your taxable income. This would only be relevant if you were older anyway as you would be limited to $50,000 if you were younger. I agree young people should not lock up all of their money in Super but providing legislation is still reasonable into the future you can't beat the tax effectiveness of Super for wealth accumulation. 15% earnings tax, 10% capital gains sounds pretty reasonable to me. Hit age 60 and retire and you can withdraw the whole lot tax free if that is what you want to do. Again a yound person would not build their entire wealth this way for the reasons you have mentioned about access to capital.

To make the suggestion that everyone in the world should be like you and become financially savy enough to completely control their finances is absolutely ridiculous. If everyone was smart enought to manage their money and the markets were completely effecient then unfortunately you would never make more than what your neighbour made no matter how smart you were because we would all be doing the same thing. I agree for most people becoming a multimillionaire is beyond their reach and no financial planning will ever help this but for others it's not about being millionaires it's about achieving their goals and valuing what is important to them. Did any of your planners ever have a value based conversation with you Tech? Did any of them ask you what is important in your life. Don't tell me it is money becasue money only facilitates what is important. Most people don't even know what they value until they are confronted with it. Some it is God, other's its family, and others it is the ability to travel every year and still retire comfortably. I think good financial planners can assist people with achieving what they see as being valuable and help prepare strategies to achieve this.

 

[Portfolio]

Tech you have some good points but i think you are going too far to make your points heard.......

What could/do I do with that $58k a year surplus?
(1) Buy another excavator to add to the fleet---nett $50/hr average 37hrs a week.

So your advice to a client is keep reinvesting everything into their small business? I agree small businesses can earn higher rates of return than equities or property (passive investments) but money isnt everything to everyone. At some stage you will have enough that you can sit back and take the returns that are given by the asset classes - property, shares, fixed interest. You wont want to work harder (even though by adding that extra excavator you would make more money).

(2) Add another $120K to the margin account Even with my tax rate I'll out perform any managed fund.---well 99% of them.

I dont think you believe this....i think you are just sticking the boot in. If you can outperform 99% of managed funds why dont you forget about excavators and become a fund manager? Maybe you think you can as you have over the last few years due to the bull market. Maybe you are comparing your highly risky speculative returns with ASX200 managed funds which arent designed to compete with what you are doing. You are right in that most fund managers will give you the index ASX200 or whatever +-5%. But when you reach the point that you have enough money and are happy with equity like returns they will suit you. You wont want to keep punting your money on speccy shares.

(3) Use the funds to service a carving up of a 1200 meter house block to 3 400 meter development blocks.Doubling investment in 12 mths with ease.
Even in these "depressed times".

"doubling your investment in 12months with ease". I dont think you believe this either. If this were possible why isnt there a listed share that would harness these very attractive returns? Answer. The returns wont continue.

(4) Service a duplex development.

??

 

[Macquack]

Why not? Where is your pithy reply. My original point was not to cast everyone with the same brush becasue people are crooks in ever industry including yours Mr Builder. People always talk about Financial planners putting them into Westpoint or Fincorp. Guess what Lawyers and Accountants also got involved in these little treasures. For the record I did not just have a dig at accountants or lawyers I am merely pointing out that all industries have crooks.

Get over it Rage, I never called you a crook.

All I said was you want a "big pat on the back". Hardly an insult.

 

[awg]

I sit there at the second interview and go through these and many more looking at these Experts and I get---blank stupid looks.---Financial planners---plan what!

What do I do for super?
I have one investment only.
My busines

##############################

Hi Tech A and others.

How do you feel about Super as an investment, in regard to trading within an SMSF in the pension phase?

No tax at all on capital gains or income, if over 60.

very low tax if over 55, or otherwise entitled.

margin and shorting via CFD.

A very significant increase in return is available under these conditions.

Availability of Capital is also a lot more flexible.

(This is the strategy I am using and developing, so any improvements/criticisms would be welcome)

regards tony

 

[tech/a]

Tech you have some good points but i think you are going too far to make your points heard.......

True and it is personal experience.
Others maybe very happy.
I'll not post on this topic again.I have nothing more to add.

 

[robots]

hello,

for many super should be looked upon as a savings account only, as it is the "pure" injection of capital that gives the "balance" in 30-40yrs,

but it needs to be tax free for any contribution, get rid of the 15% contribution tax and allow full tax deduction for contribution,

the tax benefit vs. locking away is too close to call

thankyou

robots

 

[Julia]

I remember one poster here Kris who placed everything he could get his hands on into super.
I find this tragic---why.

To use Kris as an example in order to make your point is unreasonable.
We all discouraged him from sinking all his funds (small as they were) into Super at his young age.

Just because Kris didn't seem to comprehend how foolish it was to tie up everything he had does not mean that Super is of itself "a con" as you put it.

When used appropriately, it's a very tax effective vehicle

Others have made good points about how atypical you are, Tech.
A while ago you said retirement "terrified" you.

You seem to be almost obsessively focused on your business and making more and more money.

I'd suggest that this is simply not the aspiration of most people. Most of us want enough money to provide security, the means to live the sort of life we enjoy, and the capacity to perhaps help family and others we care for.
Beyond that, eternally working to make even more money simply seems unnecessary to many people

 

[awg]

I need to vent my violent rage about FPs!!

After paying management fees for some time, after I retired due to serious illness, I used a WRAP fund

now I have setup my own SMSF.

As I am now much better, I can manage my own affairs easier.

I was paying over $10,000pa for management fees + MERs on the managed investments within my portfolio.

for that, I got nothing but convenience of admin.

As I have become more financially astute, I have been selling down my share/min portfolio at the rate of about 10% per month since December, due to falling markets.

every time I did this, I was met with skepticism.

my story is a long and complicated one, but after getting my SMSF pension finalised, I decided to cash out my WRAP, against advice again, and rollover to my SMSF.

Shortly after I wound up the "safe" mortgage trusts" redemptions were frozen!!

The final indignity, I realized that the tax on the WRAP funds is not completed till February...when this happens, I get a Credit of about $7000.

I emailed the institution I have had my Wrap, with and said " what happens to my credits"...answer YOU LOSE THEM!!

Luckily, I kept a small amount in the wrap to pay my last monthly pension.
Now I am doing a bunch of admin stuffing about to change my pension from monthly to half yearly so I get my $7000 franking credit.

my suggestion!!!...they said there was nothing i could do to keep it!!

For F#cks sake, I am so sick of having to be my own financial advisor, but pay for bad/no advice.

I consider myself to be relatively financially sophisticated, compared to the average populace ( not ASFers)...most people are reliant on FP.

Sorry about the long ranting post, I am cranky as hell!!

example of question I could never get proper answer on!

If a Oz share managed Investment is held in a Wrap fund, how is the tax credit paid on a differential basis to each individual taxpayer to reflect their tax rate...ie 0% for super pension: 15% super or low income; 30% average tax: 45% high taxpayer.

In answer to this question, I got various conflicting answers.


ps.. I use low MER cost equities now to replicate Index funds such as STW and AFI, and make sure i get every cent of tax credit, as I have a super pension, this greatly improves the perfomance of my portfolio if utilised correctly

 

[Julia]

awg, when you say you're angry with FP's, do you mean that it was a FP who advised you to invest in the Wrap structure?

 

[white_goodman]

My mate in wisdom trusted all the money that was left by his late dad to a financial advisor... he got a margin call the other day and must front $7,000 to the financial adviser/planner....

"First time its ever happened in 20 years" says the planner