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Hobart, Australia
The core objective of the firm is to assist advisers with the computational aspects of managing retirement income uncertainty.
Interests: Pension Risk Management, Age Pension Maximisation, Transition to Retirement, Investment Property
Recent Activity
The SMSF Association/Accurium checkup for SMSF financial health as at 30th June 2016 has just been published. It shows that many SMSF members are further away from achieving their retirement goals than previously. I am not surprised at that because the paper showed a median investment return of 1% for... Continue reading
Posted 3 days ago at NetActuary
Here is the ATO announcement that industry practice needs to change from 2017-18. Many funds will find this view produces a better outcome in 2016-17. CONFIRMATION OF ATO VIEW: SMSFs AND TAX-EXEMPTION ON PENSION ASSETS Self-managed super funds (SMSFs) will be required to use the segregated method to claim exempt... Continue reading
Posted Sep 11, 2017 at NetActuary
There is a certain irony in the fact that many people overseas are struggling to come to terms with account based pensions but the opposite is true in Australia. Admittedly, SMSFs have not been allowed to offer formula based defined pensions since 01/01/2006. This is partially the reason why many... Continue reading
Posted Aug 30, 2017 at NetActuary
The ATO’s view that where an SMSF is 100% in pension mode for any period during the financial year it must use the segregated method to claim ECPI, would lead (in most cases) to less tax being paid. I think there is an advantage to asking your SMSF actuary to... Continue reading
Posted Aug 23, 2017 at NetActuary
The latest Sunsuper report which surveyed over 1,000 Australians is interesting. It found that 73% plan to use the Age Pension when they retire. One is tempted to jump to the conclusion that this is either apathy or lack of financial skills. However, I wonder if this is true? Look... Continue reading
Posted Aug 22, 2017 at NetActuary
A defined benefit entitlement needs to be valued for matrimonial property settlement purposes. As the PSS doesn’t provide this value, NetActuary undertakes a considerable number of these valuations. Under the Family Law Legislation, the Attorney-General has approved special methods and factors for this fund. NetActuary is required to use these... Continue reading
Posted Aug 20, 2017 at NetActuary
If your client has more than $1.6m in an Account Based Pension and this is the only account in the fund, then there is an awkward 2016-17 ECPI decision. The ATO treats the fund as fully segregated as all of its assets are earmarked to pay pension benefits. Previously, it... Continue reading
Posted Aug 15, 2017 at NetActuary
There is an urgent need to tidy up Legacy Pensions. I had hoped the government would facilitate this, but since they show no sign of that we need to help clients tidy them up. It’s been more than 10 years since a SMSF could implement a S1.06(2) Lifetime, 1.06(6) Flexi... Continue reading
Posted Aug 14, 2017 at NetActuary
With matrimonial property settlements, our main task is to calculate the current value of defined benefit superannuation entitlements. The use of prescribed methods and factors makes this an objective and consistent task. However, some individuals want to take this a step further and calculate what accrued in that value from... Continue reading
Posted Aug 3, 2017 at NetActuary
Since we are getting a number of requests for reports on the present value of funds management costs for intellectually impaired plaintiffs on the Gray vs Richard [2014] HCA basis, the NetActuary website now has a standard form ... click here. Actuaries and Lawyers think differently. An actuary would model... Continue reading
Posted Aug 2, 2017 at NetActuary
This blog sets out the current issues with Exempt Current Pension Income calculations. If you are in a hurry, skip to the last sentence about simply avoiding the issue. Industry practice has been that it is possible to get an ECPI actuarial certificate for the whole year covering all assets... Continue reading
Posted Aug 1, 2017 at NetActuary
I am putting a bit of effort into trying to understand and assemble the more esoteric aspects of Legacy Pensions and the Transfer Balance Cap. While not claiming to be fully conversant with all aspects, this blog reports progress. It is an update and correction of earlier blogs. Flexi Pensions... Continue reading
Posted Jul 22, 2017 at NetActuary
Soon trustees will be reviewing their investment strategies as part of the fund end of year tasks. I hope this year a greater emphasis and thought will be devoted to the outcomes, risks and objectives before setting the investment strategy. As a trustee, you are required to review your investment... Continue reading
Posted Jul 17, 2017 at NetActuary
I came across the following dot point in Jordan George’s (Head of Policy – SMSF Association) presentation for next week’s Technical Day conference. “Market Linked Pensions (MLPs) ….. A “debit” arising from the commutation of a MLP to commence a new MLP is based on the “special value” at the... Continue reading
Posted Jul 13, 2017 at NetActuary
For someone who has many years of experience in the superannuation field, the Transfer Balance Cap has a degree of déjà vu. It feels like a watered-down version of RBLs. Common to the two eras is the need to place a value on income streams. I understand that for Section... Continue reading
Posted Jul 9, 2017 at NetActuary
Happy New Financial Year! Today, market-linked pensions have stopped being “capped defined benefit income streams”. This blog looks at whether this can be used to your client’s advantage. I emphasize at outset that we are short on detail and precedent of the ATO’s attitude. I certainly will not be implementing... Continue reading
Posted Jun 30, 2017 at NetActuary
The asset and income threshold to be used in the 2017-18 financial year are now available. These are: Allowable Assets – Homeowners Date Single Couple – Both Eligible Couple – One Eligible Couple – Illness Separated 01/07/2017 $253,750 $380,500 $380,500 $380,500 01/01/2017 $250,000 $375,000 $375,000 $375,000 01/07/2016 $209,000 $296,500 $296,500... Continue reading
Posted Jun 27, 2017 at NetActuary
The end of the financial year always seems to crop up faster than it should. Given the impending July 2017 superannuation changes, being on top of your end of financial year planning is as important as it has ever been. This year it is essential that you consider maximising the... Continue reading
Posted Jun 18, 2017 at NetActuary
Many defined benefit funds such as PSS, CSS, Military Super, UniSuper etc. are required to provide information for matrimonial property settlements, but don’t offer a valuation service. QSuper will provide the value for a standard defined benefit member, but present it in such a manner that the lawyer is left... Continue reading
Posted May 21, 2017 at NetActuary
The more I read the Law Companion Guidelines etc about the Transfer Balance Cap, the greater the feeling that the drafts people don’t have much SMSF experience. So the comments below are in the context of “don’t panic – let’s try and be logical”, rather than being able to point... Continue reading
Posted May 17, 2017 at NetActuary
The 1st July 2017 changes have increased tax for wealthy pensioners. Non-commutable legacy pensions such as Sec 1.06(2) lifetime, Sec 1.06(7) life expectancy and Sec 1.06(8) market linked often have quite decent assets backing them. This is because many were set up to access higher Reasonable Benefit Limits. While RBLs... Continue reading
Posted May 15, 2017 at NetActuary
Older pensioners with monies caught in non-commutable legacy pensions are treated far more harshly and inequitably compared to a person with the same amount of money in an Account Based Pension. Adding 50% of drawings (which often can’t be modified) into personal assessable income is often a lot more tax... Continue reading
Posted May 9, 2017 at NetActuary
The good news coming out of the 2017-18 Federal Budget is that superannuation has been left largely untouched. With SMSF members still working through the wide-reaching and complex superannuation changes of the last Budget which take effect from 1 July 2017, this Budget’s minimal changes will result in a period... Continue reading
Posted May 9, 2017 at NetActuary
This blog considers some actions that may need to be taken before 30th June, 2017 CONTRIBUTIONS BEFORE JUNE 2017 The Concessional contribution cap in 2016/17 is $30,000 for people aged under 49 and $35,000 for those 49 and over. From 1 July, 2017 this will reduce to $25,000 p.a. for... Continue reading
Posted May 4, 2017 at NetActuary
In some ways, not having the option to commute old legacy and market linked pensions above the $1.6m transfer balance cap has made the review task easier. One would think all that is needed is to work out the capped defined benefit income stream and reduce down an ABP. The... Continue reading
Posted Apr 2, 2017 at NetActuary