Page 93 - Smart Money

Smart Money

and that is something else you should ask. If you are addressing your
insurance needs, a financial planner should have the capacity to address
your other needs as well.

In our business as mortgage brokers, we also talk about your
superannuation and your cash flow management, budgeting and other
strategic things. If you just want to address your insurance, then an
insurance broker is good for that, but that person might not necessarily
be thinking of the other implications of their advice. They might not be
thinking about the effect the premiums might have on your super balance
or other estate planning issues.

Superannuation
Most people’s thoughts on superannuation goes like this – “I can’t touch
it until I’m 65 years of age, so I don’t care about it now. I’ll just let it be.
It is mandatory that a certain amount of my wage goes there, but I just
get the statement once a year, I look at the numbers, and then I file it.”

Our argument is that you should get your super headed in the right
direction as soon as you possibly can. The biggest asset with investments
is time, giving your investments time to run through market cycles and
generate growth over longer periods. People in their 30s and 40s have the
time, prior to standard retirement age, to get their super moving. It is just
that sometimes they don’t have the inclination.

Key Point

We always say review it; make sure it is invested in a way that you are
comfortable with. We call it the ‘sleep at night’ factor. We don’t want
people lying awake at night, looking at the ceiling, wondering if the
market is doing nasty things. It has got to be an investment portfolio
that you are comfortable with, but once you know that, you can aff ord
to selectively ignore it, knowing that at least it is doing the right thing
for you, and it is growing over time.

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