Do you want to get more from your tax return this financial year, but you’re not sure where to start? It could be as simple as knowing which tax deductions and offsets you’re eligible for
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The return of geopolitical risk? - what to watch over the remainder of 2021
The attached note takes a look at the importance of geopolitical risk for investment markets and key geopolitical risks to watch over the remainder of 2021.
The key points are as follows:
Geopolitical issues generate much interest, but don't necessarily have a significant impact on markets.
But geopolitical risks are higher than prior to the GFC reflecting three big themes: a populist backlash against economic rationalist policies; the falling relative power of the US; and the polarising impact of social media.
After a lull following the transition to President Biden, key geopolitical issues to watch this year are: US and Australian tensions with China; Iran/Israel tensions; Russia and Ukraine; the German election; US tax hikes; and a possible early Australian election.
Read more about the article here
Learning the lessons of an extraordinary year of 2020
With some distance now between us and the year that changed everything, we look back and consider what we’ve learned from 2020 and reasons for optimism for the rest of this year.
Read more here
How to invest for your children’s future
Every parent wants to give their child the best start in life. Fortunately, with good financial planning, you can set your kids up for a bright (and independent) financial future, in just a few simple steps.
To know more about financial planning for your children, click here.
Shares have had a very strong rebound since March last year so where are we in the investment cycle?
With shares coming up to the one year anniversary of their pandemic lockdown driven lows on 23rd March 2020, the attached note takes a look at where we are in the cyclical bull market in shares and the broader investment. The key points are as follows:
The history of cyclical bull markets in shares suggests that the rebound since last March still has a way to go.
But it’s normal for the second 12 months of a cyclical bull market to see slower returns from shares.
While shares are vulnerable to a further correction triggered by the spike in bond yields, we are not seeing the sort of unambiguous overvaluation, economic overheating, monetary tightening and investor euphoria normally seen at cyclical tops.
Read more here
Market outlook Q&A – global recovery, vaccines, inflation, the risk of a share crash, Aust house prices and other issues
The attached note takes a look at the main questions investors commonly have regarding the investment outlook in a simple Q&A format.
Some of the key points are as follows:
Global recovery is on track. Vaccines are working.
JobKeeper’s end won’t derail Australia’s recovery.
Inflation could become an issue in the medium term.
Shares are at risk of a correction but are supported by economic and earnings recovery.
Australian house prices are booming again but expect measures to slow it down in the months ahead.
Read full article here
How the gender pay gap is causing problems for Aussie women
Women are entering retirement with significantly less superannuation and personal savings than men. We explore how the gender pay gap is adding to this growing epidemic.
Click here to read more
An introduction to Exchange Traded Funds (ETF)
Exchange traded funds (ETFs) are a low-cost way to earn a return similar to an index or a commodity. They can also help to diversify your investments. You can buy and sell units in ETFs through a stockbroker, the same way you buy an sell shares.
Click here to read on how ETFs work, types of ETFs, pros and cons of investing in ETFs and how to trade ETFs.
What does it really cost to raise kids?
We often hear that raising kids is expensive, but just how much will it cost you over the first five, ten, or twenty years? Click here for a closer look at the costs of each stage of life.
Show your finances some self-love
Are you guilty of changing your spending habits when you’re in a relationship? Do you have a financial plan, or are you relying on a partner to take care of you in retirement? Whatever your situation, there’s never been a better time to step up and take charge of your finances.
The most important thing is to make sure your finances are sound for you. This is especially true for women, who face extra hurdles to financial freedom. On average, women retire with 47% less super than men, so it pays to have a clear retirement plan.
Click here to read more
The bond crash of 2021? Seven things for investors to consider
The attached note takes a look at the upswing now underway in the bond market.
The key points are as follows:
Higher bond yields are normal in economic recovery and should not be a major problem for shares if they are matched by rising earnings. But too rapid a rise in bond yields risks driving a deeper correction in shares.
Central banks want higher inflation but will look through any short-term spike.
The 40-year downtrend in inflation and bond yields is likely over.
But the fundamental backdrop of improving growth, rising profits and still low rates supports the case for solid 6-12 month returns from shares.
Top 5 tips to achieve your money goals in 2021
Work out your financial position
Start with a financial stocktake to work out what you own and what you owe.
Make a plan for your money
What are your money goals this year? Give yourself the best chance at achieving them.
Build a savings buffer
Having a financial safety net will give you peace of mind.
Tackle your debt
The good news is there are steps you can take to relieve the financial pressure.
Master the investing essentials
Planning is the key to successful investing. Creating a plan will help you find investments that fit your goals.
Nine common mistakes investors make
The attached note takes a look at the nine most common mistakes investors make.
The key points are as follows:
Many of the mistakes investors make are based on common sense rules of thumb that turn out to be wrong
As a result, it’s often wise for investors to turn common sense logic on its head.
The easiest way to avoid many of these mistakes is to have a long-term investment plan that aligns your financial goals with your risk tolerance
Click here know more.
Seven key charts for investors to watch regarding the global economy and investment markets this year
Seven key global charts worth keeping an eye on by investors this year are:
the trend in new coronavirus cases and deaths;
global business conditions PMIs;
unemployment;
global inflation;
bond yields
the gap between earnings yields and bond yields; and
the US dollar.
Click here to access these charts
2021 - A list of lists regarding the macro investment outlook
2020 turned out far better for diversified investors than had been feared when the pandemic hit, which triggered plunging market shares and deep recessions. The average balanced growth superannuation funds look like they have returned around 3%. This followed around 15% last year. Balanced growth funds returns have averaged about 7% per annum over the last five years, which is well above inflation and bank deposit returns.
The key points are:
2020 turned out far better for investors than was feared;
2021 is expected to provide solid returns and see a further rotation from pandemic winners to cyclical investments;
Watch: coronavirus and vaccines; US politics; China tensions; inflation; and the hit to immigration in Australia.
Click here to read Oliver’s Insights, and views on the investment outlook.
Busting post-Christmas debt
Feeling financially fragile after spending big during the festive season? Click here to learn about the pros and cons of different approaches to paying off credit card balances in Money & Life’s comprehensive debt-busting guide
What does a COVID-19 Christmas look like in Australia?
Christmas 2020 will look a little different for many people, but there are still plenty of ways to enjoy the holiday season with friends and family.
Click here to read the current guidelines for how many people you can have over, where you can travel, and how many people can attend at vanues.
The best financial advice we heard this year
Who have you been turning to for money advice in 2020?
Click here to read insights from six leading financial planning professionals who have been helping their clients feel more confident in their finances this year.
COVID-19 Vaccine Development
Pfizer has recently conducted their Phase III COVID-19 vaccine trial, resulting in 90% efficacy. This outcome, paired with continued progress on other COVID-19 vaccines, therapeutics, and treatments, generates hope for a faster return to normalcy. The second half of 2021 will be a ramp up period towards societal “normalcy”, with a return to normal life for most people occurring sometime in 2022.
Please click here to read a brief interview between healthcare analyst, Andrew Waight, and Altrinsic’s Head of Client Experience, Sara Sikes, regarding the vaccine development.
Thoughts on the Market
Vice President Biden appears set to be the 46th President of the United States, most likely with a divided Congress. A split Congress has two opposing effects on growth. On the positive side, it should mean that more centrist policies are likely to be pursued, all of which are constructive for growth. Conversely, a Republican controlled US senate is likely to pursue a material decline of the US fiscal deficit, which is set to underpin a large US fiscal drag in 2021.
Click here to read more on Perpetual Investments’ thoughts on the US economy amidst the change of Presidency and the surging pandemic.