Roger Montgomery’s insights into what 2017 holds for the investing world. An update on the state of residential property and finding value in shares that have recently suffered price falls. If you are concerned about your returns, you should brace for an end of the residential construction boom. You should also be very cautious about the excessive prices of high-yielding stocks (those paying dividends that are unlikely to grow), and you should be most enthusiastic about high-quality mid cap and small cap stocks that have been punished recently with share price declines of up to 50%. Let’s start with property… Courtesy of UBS and the RLB Crane Index, we recently learned that the residential crane count in Australia skyrocketed by 313% between September 2013 and September 2016. There were more residential construction cranes along the east coast of Australia than across New York, Boston, Chicago, San Francisco, Los Angeles, Toronto and Calgary combined. Property doyens are selli...

A Case Study by Melanie Dunn answering some important questions surrounding the changes being made to Australia’s superannuation system. Our recent article set the scene for how SMSFs will need to re-assess their pensions under the $1.6 million pension cap. The comments and questions received highlight the complexity of this reform for SMSF trustees. To further decode the changes, we found there are four key questions regarding these reforms: How will member accounts be tracked from 1 July 2017? Can the fund employ a segregated assets strategy?  Is the fund eligible to preserve capital gains on some or all fund assets? How is the capital gains tax relief applied?  To demonstrate the key points, we have developed the following case study: Case study – Fred and Wilma’s SMSF Fred, aged 68, and Wilma, aged 69, are both fully retired and, as at 7 December 2016, have: An account-based pension in the SMSF in Fred’s name valued at $1.2 million. An account-based ...

Jonathan Hoyle and Diana Chan view Morrison’s super changes as a gift for financial planners – they highlight the critical issues. “Contrariwise,” continued Tweedledee, “if it was so, it might be; and if it were so, it would be; but as it isn’t, it ain’t. That’s logic.” Treasurer Scott Morrison has delivered the Christmas present to the financial planning industry that it had glimpsed six months ago but was too excited to actually believe – massive new complexity to the superannuation system. The body of Simpler Super has been incinerated, buried and interred. RIP Simple Super In its place is a labyrinth of new rules that would make Alice wish she had never gone down the rabbit hole. Long live complexity, bureaucracy and tinkering governments. Quite what we have done to deserve this exhilarating Christmas present is a mystery, but we’ll take it. The need for superannuation and wealth planning advice just became essential. Whatever next? Taxpayer subsidised advice (as th...

Noel Whittaker takes a comprehensive look at how the tax deductibility of super contributions works . The new superannuation rules have been passed, but judging by the emails I am receiving, many of you are more confused than ever. One reader says, “It has been widely reported that from July 2017, superannuation contributions will be tax deductible to the limit of the concessional amount of $25,000. Does that mean then the salary sacrifice will no longer apply? Can you please explain how the salary sacrifice and the tax-deductible contributions fit in with each other? Does one exclude the other?” It’s a great question, particularly as it gives me the opportunity to highlight the opportunities that will be available for employees after 30 June 2017. Every eligible person can claim a tax deduction  Superannuation contributions fall into two categories, concessional, and non-concessional. The former were once called deductible contributions because they came from pre-tax doll...