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Edition: 106

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Edition 106

  • 24 April 2015

Australia's housing prices impact on other investments, Sydney's housing bubble, the reason for average returns from index funds, facts for bond investors, and thinking about retirement planning.

Impact of house price falls on other assets

Australians are heavily invested in residential property and the impact of a property crash is obvious for those assets. But the consequences for many other investments should be considered.

Sydney residential market – bust in the making?

Sydney house prices were up 14% in the year to March 2015. What's making the market so strong, how much longer can the growth persist and will it ultimately end in tears? Unfortunately, there are no simple answers.

Index funds invest in the bad and the good

The promise of diversification, low costs and access to overseas markets are boosting the popularity of all types of index funds, but broadly diversified cap-weighted equity index funds can only promise ‘average’ returns.

Income-seekers: these 'myths' could come back to haunt you

Low interest rates have left many income-oriented investors scrambling for yield. If interest rates rise, will individual bonds, dividend paying stocks or cash be safer than the core bond funds so often recommended?

Retirement catches most people unplanned

Despite the publicity about long life expectancy, research on Australian retirement highlights a lack of planning, and most people do not determine their own retirement date.

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Why spending more in early retirement can improve lifetime income

Conventional wisdom encourages retirees to preserve superannuation. But if those likely to qualify for the Age Pension later in life spend a little more today, it may deliver higher lifetime income and a more stable retirement.

Will you run out of money in retirement?

Fear of running out has become a defining retirement anxiety. Why do some retirees die with substantial wealth while others deplete their nest egg? Evidence suggests the answer is more complicated than we think. 

The investment that sidesteps the new tax traps

Tax rules have changed, but many investors are still using yesterday’s strategies. Insurance bonds may offer advantages for those seeking greater control, tax efficiency and certainty about their wealth.

Testamentary trusts have secured the CGT exemption

Treasury’s latest CGT reform draft delivers a win for testamentary trusts and deceased estates, exempting estate-derived gains from the 30% floor. However, questions on death and divorce rollovers remain unresolved.

Meg on SMSFs: What do we think about reversionary pensions these days?

Reversionary pensions have long been a staple of SMSF estate planning, but are they still the best option? Meg Heffron revisits a once-clear favourite and asks whether changing super rules have shifted the balance.

How does the 4% rule stack up?

The 4% rule has long been retirement's gold standard. But after a difficult period for investors, fresh analysis suggests a more conservative approach may significantly improve the chances of making savings last.

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