Staying ahead of the game is an Authorised Representative of RI Advice Group Pty Ltd

Staying ahead of the game is an Authorised Representative of RI Advice Group Pty Ltd

Staying ahead of the game is an Authorised Representative of RI Advice Group Pty Ltd

Staying ahead of the game is an Authorised Representative of RI Advice Group Pty Ltd My Name Financial

Staying ahead of the game is an Authorised Representative of RI Advice Group Pty Ltd JV logo

5 Disclaimer Important Notice RI Advice Group Pty Ltd, ABN , holds Australian Financial Services Licence Number and is licensed to provide financial product advice and deal in financial products such as: deposit and payment products, derivatives, life products, managed investment schemes including investor directed portfolio services, securities, superannuation, Retirement Savings Accounts. The information presented in this seminar is of a general nature only and neither represents nor is intended to be specific advice on any particular matter. RI Advice Group strongly suggests that no person should act specifically on the basis of the information contained herein but should obtain appropriate professional advice based on their own circumstances.

6 Our credentials Experienced 30 years’ experience Over 80,000 clients Over $10b under advice Professional personal financial planning advice Backed by quality research and technical teams Over 110 offices nationwide

7 Staying ahead of the game There are five keys rules for retirees to remember during a market downturn: 1.Keep a long-term view 2.Don’t avoid growth assets 3.Aim to avoid turning paper losses into real losses 4.Check-in with Centrelink 5.Consider leaving a legacy

8 1. Keep a long-term view Source: S&P/ASX 300 ACC Index as at 31/03/2010

9 … and stay diversified Data: Australian Shares - S&P/ASX 300 Accum. Index, International Shares - MSCI World (ex Aus) in $A - unhedged, Property Securities - S&P/ASX 200 Prop Trust, Australian Fixed Interest: Commonwealth Bank Bond Index (Pre Sept 89) / UBSA Composite Bond All Maturities Index (Post Sept 89), International Fixed Interest: Citigroup WGBI Ex AUD Hedged, Cash: UBSA Bank Bill Index Source: IRESS, Mercer, RBA Note: Returns based on March rolling annual returns.

10 2. Don’t avoid growth assets During volatile times it can be tempting to turn to conservative assets such as cash or term- deposits Remember –You need sufficient growth to stay ahead of inflation –Shares can provide capital growth and income

11 $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35, Income $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 Capital Value All Ordinaries Index - Dividends (LHS)Term Deposits - Interest (LHS) All Ordinaries Index - Value (RHS)Term Deposits - Value (RHS) Source: IRESS, S&P ASX All Ordinaries Index. Reserve Bank of Australia, ‘Bank Deposits $5,000-$100,000 1 year rates’. Past performance is no indication of future performance. Data to 31 December Which income stream would you prefer? Return on investment of $100,000 in shares vs term deposits Shares can provide capital growth and income

12 You need sufficient growth to stay ahead of inflation Source: Reserve Bank of Australia, Colonial First State. Data to 31 December $100 in 1970 $10.78 in 2008

13 Still finding it hard to sit tight? Consider capital protection products – Help protect investments against market ‘ups and downs’ – Lock in returns during strong growth and limit downside when markets are volatile Speak to a financial adviser to see if capital protection is appropriate for your situation

14 3. Aim to avoid turning paper losses into real losses Wherever possible you should avoid crystallising unnecessary losses in a depressed market This includes: Selling investments Switching from one investment to another Switching your super Drawing an income from super

15 Sitting tight - Catherine and Steven’s story *Source: This graph has been prepared by ING Australia Limited ABN It is based on an initial investment of $100,000. Upfront fee of 4% is deducted. Investment is in a balanced fund made up of Cash 7%, Australian Fixed Interest 17%, International Fixed Interest 5%, Australian Shares 37%, Listed Property 9% and International Shares 25%, rebalanced monthly. The fund is assumed to earn index returns for each sector after ongoing charges. All income is reinvested. No other fees are taken into account. Past performance is not an indication of future performance. Staying in a Balanced fund was a better strategy than switching to cash*

16 Pensions from super Wherever possible: Draw from non-growth assets Reduce payments –Take advantage of the 50% reduction in the minimum pension drawdown (for 2010/11)

17 4. Check-in with Centrelink On the bright side it’s possible you may now be entitled to a pension or a pension increase due to: The reduced value of your assets Reduced deeming rates under the income test

18 Social security – assets test Homeowners Single Couple (combined) For full pension up to $181,750 up to $258,000 For part pension less than $668,000 less than $991,000 Non-homeowners Single Couple (combined) For full pension up to $313,250 up to $389,500 For part pension less than $799,500 less than $1,122,500 * rates valid until 30 June 2011 Pension entitlement reduces by: $1.50 for every $1,000 over lower threshold (single and couple) Example: $10,000 over the lower threshold reduces pension by $15 per fortnight ($390 pa)

19 Social security – income test Family situation Single Couple (combined) For full pension (pf) up to $ up to $ For part pension (pf) less than $1, less than $2, Pension entitlement reduces 50 cents for each dollar over the limit (single) 25 cents for each dollar over the limit (couple – each) Example: $100 per fortnight over threshold reduces pension by $50 per fortnight ($1,300 pa) NOTE: those in receipt of age pension on 19 September 2009 may be assessed under the transitional rules. * rates valid until 30 June 2011

20 Centrelink benefits Receiving a Centrelink benefit will help out by: Providing an extra income Allowing you to decrease the income you draw from super Giving your access to other benefits through the Pension Concession Card

21 5. Consider leaving a legacy Points to consider: Family succession planning is an important part of any financial plan. Family succession planning is more than just a Will It extends to: – superannuation – life insurance – joint assets – Powers of Attorney – protecting assets – providing tax relief - and more

22 Consider leaving a legacy If your estate includes a share-based portfolio or super you may need to rebalance it to remain fair to different beneficiaries You can never be too careful, particularly if you are older or in poor health

23 Case study Estate Planning – Social Security John and Betty Assets... their home other assets $660,000 incl. $60,000 in jewellery Receive $ per fortnight in age pension (combined)

24 Case study cont’d Without estate planning, John receives No pension No Pensioner Concession Card With estate planning, John receives $88.73 age pension per fortnight Pensioner Concession Card

25 Seeking advice We can provide expert advice on: Retirement in a market downturn Superannuation and pensions Investment selection Tax effective investment Maximising Government benefits Family succession planning Aged care

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