Assets just left in the bank don’t tend to grow much
NOEL WHITTAKER
YOUR ADVICE
I AM 64, receive a Centrelink disability pension, and have $111,000 in an allocated pension account; plus $230,000 in a superannuation account. My husband is 73, on the age pension, and has $126,000 in an allocated pension account. We own our home, have no other investments, and no debts. If we withdraw our allocated pensions and transfer them into a bank account to cut down on management fees, would our pensions be affected?
It would appear your pension is assets-tested, so there should be no adverse effect on your Centrelink benefits by withdrawing the money from pension accounts.
Moving your super account to bank accounts outside super will see a short-term reduction in your pension as it’s not counted as an asset until you reach pensionable age.
You are relatively young, and may well have 30 years of living ahead of you – this would make me extremely wary about moving all your assets to bank deposits. Over the long term, they are usually the worst performers of all.
Take advice, but perhaps a better plan is to consider changing super funds to reduce the fees. WHEN my father died he bequeathed CBA shares to his six children, including myself. Can we distribute them evenly or do they have to be sold – they were bought after CBA listed. How do we find out about shares in companies that have changed ownership?
Death does not trigger capital gains tax, it merely transfers the liability to the beneficiaries. It may well be that some beneficiaries may want to sell them and pay the CGT, and others will not.
Therefore I strongly suggest you sit down together and work out a win/win situation.
The relative share registries should be able to help you trace shares, and your accountant will have access to other resources if necessary. I AM 21 years old and have a dream to own a property. I want to start thinking about investing my money somehow.
I’ve worked out on my salary that I could probably afford repayments of around $800 a month. I have looked at home loans, but with what I am earning, I can’t borrow enough money to afford anything.
I have got $26,000 sitting in a high interest account but I am not sure what to do from here.
What would be your advice for an investment that would give me the best return on my money?
If you are prepared to take a long-term view, and won’t panic when the stock market has one of its normal bad days, you could consider a margin loan for a quality share trust. Your money will be spread over a range of blue chip companies and you can start small.
Also, you will get a tax advantage as part of the income stream will be franked and you can add to your investment on a regular basis by reinvesting dividends or by making further contributions.
If you seek advice and adopt a conservative loan to valuation ratio, you should do well.
I have a dream of owning my own property
Noel Whittaker is the author of Making Money Made Simple and other finance books. His advice is general in nature and readers should seek their own professional advice before making any financial decisions. Email: noel@noelwhittaker.com.au