WELCOME TO THE AUTUMN EDITION OF

ASPIRA TIONS
The Wright Family Trust

Trading as Pivotal Planning
News and Information in this Edition YOUR PARTNER IN LENDING AND ALL
OF YOUR FINANCIAL PLANNING NEEDS

Anthony Wright
Authorised Representative of
AMP Financial Planning Pty Limited AFSL

Gut instinct is no match for expert advice

No. 232706
ABN 60 262 244 285

Level 1

Home equity - the $500 billion resource for seniors 47 Lower West Burleigh Road Burleigh Heads
QLD 4220

What's your debt age?

Office Number: 07 55200 698

Email: anthony@pivotalplanning.com.au

Give your career a health check Website: www.pivotalplanning.com.au

We can provide advice on:

1. Investment Strategies (strategic asset
How to cope with losing independence allocation and goals based investing)
2. Budgeting and cash flow management
3. Debt management (including
borrowing for personal and
How can I safeguard my ability to pay off my home loan? investment purposes
4. Salary packaging
5. Superannuation strategies and
The property market outlook for 2017 retirement planning
6. Personal Insurance
7. Estate Planning
8. Centrelink and other Government
What financial records do I need to keep? benefits
9. Ongoing advice and services, including
regular portfolio reviews
Gut instinct is no match for expert
advice
By Paul Clitheroe 30 January 2017

One of the marvelous aspects of living in the digital age is the ready availability of information. Its a far cry from the days when we often
made decisions based on a hunch, and thats just as well. Research by broking group Mortgage Choice confirms that one in three Australians
have regretted a financial decision based on gut instinct.

When it comes to money matters, the way we make choices is extremely important as there can be a lot riding on the outcome. Our financial
lives have grown more complex and we are constantly called on to make key decisions, anything from Should I pay more off my mortgage or
put more into super? through to Which blend of investments is ideal for my portfolio?

Its a complicated world, and behavioral science sheds a fascinating light on the way we approach financial decisions. Unfortunately, research
shows there is often a disconnect between what we know is the right thing to do, and the action we actually take.
The thing is, financial decisions are a part of everyday life whether its looking for ways to save, deciding which credit card offers the best
value, choosing a home loan, or planning for retirement.

Whatever the decision, being confident and informed can make a difference to your financial wellbeing and peace of mind. Research by the
Australian Investments and Securities Commission (ASIC) found one in three Australians find dealing with money stressful and overwhelming.
Yet the study also found one in ten people dont consult any source of information at all when making money-based choices.

So, whats the solution? An obvious step is to skip gut instinct and do some research.

There is a surprisingly large range of advice options available. A wealth of comparison sites show the latest deals for a vast range of financial
products, and the MoneySmart website is an excellent source of education on basic money management.

The downside of these sites is that the information they offer isnt tailored to your needs. And thats where forming a long term relationship
with a professional financial adviser, who understands your circumstances and goals, can make a valuable difference.
Interestingly, the Mortgage Choice study mentioned earlier found less than 10% of Australians have regretted a decision made after seeking
financial assistance.

The bottom line is that going with your gut instinct may be fine when it comes to selecting golf clubs for the back nine, but its no basis on
which to build financial security.

****************************************
EDITORS PLEASE NOTE
Paul Clitheroe's 'Making Money' is provided on the condition that the following sentence accompanies the published column:

Paul Clitheroe is a founding director of financial planning firm ipac, Chairman of the Australian Government Financial Literacy Board and chief
commentator for Money Magazine.
Home equity - the $500 billion
resource for seniors.
By Paul Clitheroe 6 February 2017

The latest round of figures showing rising home values in almost all our state capitals highlights how many Australian retirees could have a
valuable resource at their fingertips.

Older Australians, who may not have enjoyed the benefits of employer-paid super for their entire working life, can face the prospect of a
lean retirement. However, one area where over-50s often have an advantage over their younger counterparts is home ownership.

ABS data shows that among the under-35s, theres not much in it between the proportion of renters and those who own their home. Among
the over-65s, almost 85% of people are homeowners. This is important because for senior Australians home equity can be a source of
retirement income.

Its all thanks to the availability of reverse mortgages a financial product that allows homeowners, usually aged 60-plus, to draw on home
equity with loan funds secured by their home.

No repayments are necessary with a reverse mortgage, at least while you live in the place. Interest charges and fees are added to the loan
balance with the total to be repaid when the property is sold or the last borrower has passed away.

Its an option for asset-rich, cash-poor seniors to boost retirement cash. But reverse mortgages do have downsides.

In its January 2017 star-rating report on reverse mortgages, research group Canstar found the average interest rate applicable to these loans
is 6.25%. Thats around 2% more than you could pay on a standard home loan, and the mounting interest charge raises questions about
how a reverse mortgage can impact home equity over time.

Let me start by saying that anyone considering a reverse mortgage should look for a no negative equity guarantee. This means you will
never owe more on the loan than the value of your home. That said, Canstar found that after 20 years, a loan for $90,000 representing 15%
of a propertys value, could end up costing a total of $349,431 including the initial borrowing. Over 30 years, the loan cost including
principal, could blow out to $662,131.

These figures may seem alarming, and they are based on current interest rates, which are at record lows. On the plus side, its a reasonable
bet your property will rise in value over the next 20-30 years. The big unknown is whether the capital growth will outstrip the loans interest
rate.

The latest review of the reverse mortgage market by Deloitte estimates Australians over age 65 hold more than $500 billion of home equity,
yet only about 40,000 of the nations seniors have a reverse mortgage. So home equity is definitely an untapped resource. For retirees
finding it tough to meet the cost of living, a reverse mortgage may be worth considering. Nonetheless, it is an area where good legal and
financial advice is essential, especially if you plan to leave a reasonable estate.

****************************************
EDITORS PLEASE NOTE
Paul Clitheroe's 'Making Money' is provided on the condition that the following sentence accompanies the published column:

Paul Clitheroe is a founding director of financial planning firm ipac, Chairman of the Australian Government Financial Literacy Board and
chief commentator for Money Magazine.
What is your debt age?

Online source: Produced by AMP Life Limited and published on 23 January 2017. Original article.

Print source: By AMP Life Limited, originally published on 23 January 2017 on amp.com.au/insights

The types of debt we have largely depends on our age and stage in life.

For most of us, having debt in some form or another is an inescapable fact of life. And despite its reputation, debt is not necessarily a dirty
word.

If managed well, it can be a powerful tool to build wealth, and good debts, such as those used to invest in an asset which increases in
value - like property or shares - can do just that.

Borrowing to fund a lifestyle you cant really afford, for big ticket items such as new cars and holidays, is an example of bad debt. Its not
always possible to avoid bad debt, but you should try to minimise it.

Often the types of debt we have at 20 are very different to those we have at 50.

Read on to discover the most common types of debt held by your peers, from the AMP.NATSEM report Buy Now, Pay Later: Household
Debt in Australia, and see if your financial circumstances match your debt age.

Starting out under 30s

Younger people have the highest proportion of student debt as a percentage of their total household debt at 8.3%.

This is because many students defer the cost of uni fees by accessing the HECS-HELP or FEE-HELP loan schemes, which they only need to
begin to repay when their earnings meet the minimum repayment threshold.

This age group also has the highest proportion of personal loan debt - representing 5.4% of their household debt - with these higher
interest, short-term loans used to fund purchases such as cars, holidays and other consumer products.

Perhaps surprising is that home loan debt is the largest contributor to household debt in this age group, at 58.3%, signalling that many
young people are making it onto the property ladder.

Accumulators 30 to 50 year olds

Home loans dominate household debt amongst this group, accounting for 62.8%.

Investor debt also begins to increase among accumulators as a way to build wealth through taking out a loan to invest in shares or
property, representing 31.7% of all household debt; while student loans, credit cards and personal loans barely rate, all at less than 3%.

Pre-retirees 50 to 65 year olds

Investor debt (46.3%) overtakes home loan debt (45.9%) as the biggest contributor to household debt in the pre-retiree group, who are
paying down their home loans and looking to grow their wealth as they approach retirement, through investments in property or in shares.

Retirees over 65s

Many retirees own their own home outright, reflected in the fact that home loan debt comprises only 28.2% of total household debt for
this age group.

Compared to the other age groups, retirees have had a longer time to pay off their home loans, while some may have also used their
super to pay it off completely. But compared to the past, more retirees are carrying more home loan debt over into retirement, with this
figure up from 19.6% in 2004.

Investor debt represents 59.7% of household debt for people aged over 65, while retirees are also among the biggest carriers of credit
card and personal loan debt, at 5% and 5.1%, respectively, perhaps reflecting their propensity to travel or a need for additional cash to
fund their retirement.
 What is your debt age? -
Continued

Tools and resources to help you manage your debts

Regardless of what type of debt you have - or its size - managing it effectively is crucial. As a first step, its a good idea to have a budget to get
a clear picture of your financial situation.

Once your budget is in place, you can consider your financial goals.

If reducing your debts is one of these, the AMP debt reduction calculator could help, or seek financial advice to devise a strategy to keep your
repayments on track so you can be debt-free.

Important information

AMP Life Limited. This provides general information and hasnt taken your circumstances into account. Its important to consider your particular circumstances before deciding whats right for you. Although the
information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except
where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.

.
Give your career a health
check
How to cope with losing
independence

Online source: Produced by AMP Life Limited and published on 20 December 2016. Original article.
Print source: By AMP Life Limited, originally published on 20 December 2016 on amp.com.au/insights

If you or a loved one is experiencing a loss of independence, you may be able to maintain a sense of control.
Few, if any of us, look forward to losing independence. In fact, research reveals that 75% of older people feared losing independence while
only 29% feared dying1. It also revealed that 44% were worried about moving into an aged care facility.
Whether a physical, social or emotional reason prevents complete independence, it generally brings a sense of loss.

Understanding the cycle of loss

As people age, the loss of independence can stem from physical and mental changes, and social and emotional effects that dramatically
alter day-to-day life.
For example, physical changes like diminishing vision or a loss of hearing can interfere with the performance of simple tasks like driving,
walking long distances or communicating in general. Mental impairment can cause people to lose the ability to perform everyday tasks and
become forgetful.

Such changes increase the need for help from others and add to feelings of dependence and inadequacy, while lowering confidence and
stopping some people from participating in enjoyable activities. The overall impact can increase feelings of frustration, anger, guilt and
isolation.

Adding to the burden may be well-intentioned loved ones who place restrictions on the person losing independence out of concern for
their wellbeing. And the need to accept help often reinforces feelings of helplessness.

Increasing a sense of control

We all have a common need to retain some sense of independence and dignity while feeling we are making a valid contribution. Some
people facing a loss of independence may have previously been quite dependent on othersperhaps never holding a drivers licence and
relying on friends and relatives to drive them around.
But for many, a newfound dependence on others can be very difficult. The more capable and independent a person was in the past, the
greater the loss experienced.
There are things you and your loved ones can do to increase the sense of control:
1. Its your life, keep control
If you are experiencing a loss of independence yourself, make sure your loved ones know how you feel and what you need to live a life that
continues to have meaning for you.
For example, if you feel loved ones are micromanaging your every move, let them know how they can help you feel more independent and
how they can support you to exert your right to make choices.
If the loss of independence is getting you down there are also support services available like Beyond Blue (or calling 1300 22 4636) My
Aged Care (or calling 1800 200 422).
2. Loved ones, be reactive not too proactive
If your loved one is experiencing a loss of independence, its understandable for you to be concerned about them. It can be tempting to
take the initiative and provide help, but it may be more effective in the long run to first speak with them, if possible.
The two most important questions you can ask are whether they need help and how it would be best for you or others to provide it. Letting
your loved ones have a say in the help they receive can ease the emotional impact.
3. Facilitate
However you end up helpingand you may feel that youre walking on eggshells sometimestake care with how you go about it. If youre
able to facilitate a conversation so your loved one comes up with their own solutions and ideas, itd be a better outcome for them, and
possibly the most generous thing you can do.
4. Encourage
If possible, encourage your loved one to keep pursuing their passions or find new hobbies. Help them maintain their relationships with
family and friends too. Perhaps you can help by finding activities they may be interested in.
Seeking knowledge and assistance
If you or a loved one is experiencing a loss of independence, you may benefit from our education module Understanding aged care.
But before deciding on a solution, seek the advice of your health practitioner and seek financial advice to understand all of the
options available.
Important information
AMP Life Limited. This provides general information and hasnt taken your circumstances into account. Its important to consider your particular circumstances before deciding whats right for you. Although
the information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision.
Except where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.
How can I safeguard my ability to pay
off my home loan?

Online source: Produced by AMP Life Limited and originally published on 19 December 2016. Original article.
Print source: By AMP Life Limited, originally published on 19 December 2016 on amp.com.au/insights

Its not unusual that life can be smooth sailing one minute and throw you a curveball the next.
You might be hit with an injury or illness, a reduction in income or redundancy, a separation from your partner, or even a death in the family
all of which can be difficult, emotionally as well as financially.
If you happen to owe money on your home loan, having a financial backup plan, should such a situation arise, could go a long way.

What you can do today

Set up an emergency fund
An emergency fund can give you peace of mind by creating a pool of rainy-day savings that can be used to pay unexpected bills in the event
of a financial dilemma.
It also reduces the need to rely on high interest borrowing options, such as credit cards or applying for payday loans, which can often be an
expensive form of finance and create unwanted debt.
A decent-sized emergency savings pot wont be built overnight, but the good news is putting aside a little money on an ongoing basis could
really come in handy down the track.
Check out our six steps on how to set up an emergency fund.

Maintain your insurance

Depending on what life throws at you, having personal insurance may help you to still meet your financial commitments, which could include
making your home loan repayments.
After all, at least one in five Australians will be unable to work due to an unexpected accident, injury or illness at some point in their life.1
For this reason, checking you have the right type of cover and enough of it, particularly when your circumstances change, is important.
If you dont have insurance, now might be a good time to learn about the types of cover available, and whether you take it out through super
or via an insurance company, broker or adviser.
If things take a turn for the worse

Talk to your lender

If you run into tough times and you dont have an emergency fund, renegotiating your home loan might allow you to reduce your
repayments by switching to a different type of home loan or moving to interest-only payments.
You may also be able to seek assistance from your lender by claiming financial hardship.
All lenders must consider reasonable requests to alter the terms of a home loan in instances where someone suffers genuine financial
hardship and feels a change would enable them to meet ongoing repayments.
If youre not happy with your lenders response you can also contact the Financial Ombudsman Service or Credit and Investments
Ombudsman, both of which are free external dispute resolution schemes.

Sell your home and buy a cheaper property

It may not be ideal, but if you dont have other options, selling your home might be worth exploring to avoid having your property
repossessed and facing what could be an even bigger financial fallout.
It will take time to arrange things, whether selling your home outright or buying a property thats cheaper to maintain. So, speak to your
lender about how you can go about it and consider seeking advice as to whether this is the best path to take before making a decision.

Access your super to make your repayments

In some cases of severe hardship you may be granted early access to your retirement nest egg under strict conditions. However, this should
be a last resort.
If you want to know more about how you can access your super in special circumstances check out the early release of superannuation
section on the Centrelink website.
Being prepared
Life has its ups and downs so its best to be prepared. Remember, if you do run into tough times speak to your lender as soon as possible to
see what your options are.

1 www.lifeinsurancefinder.com.au/post/compare-life-insurance-australia/the-impacts-of-underinsurance-in-australia/
Important information
AMP Life Limited. Its important to consider your particular circumstances and read the relevant product disclosure statement before deciding whats right for you. This information hasnt taken your
circumstances into account. This information is provided by AMP Life Limited. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and
their representatives may receive in relation to products and services provided to you. All information on this website is subject to change without notice. Although the information in this article is from sources
considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decisions. Except where liability under any
statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.
The property market outlook for
2017

Online source: Produced by AMP Life Limited and published on 13 January 2017. Original article.

Print source: By AMP Life Limited, originally published on 13 January 2017 on amp.com.au/insights

Could apartments be the next big thing in Australian property?

In this article, we speak to Dr Shane Oliver, AMP Capitals Chief Economist and Head of Investment Strategy, to seek his insights on how the
Australian property market has performed over the last year and what opportunities lay ahead for 2017.

Review of 2016

Q: Its been a rollercoaster of a year for global investors with events like Brexit, Italy saying No to Senate reforms and the unexpected US
election outcome. How have these events impacted on the Australian property market in 2016? And what local factors have affected the
housing market?

A: Globally, events such as Brexit, have had a positive effect on the Australian property market to the extent that interest rates remained lower
than may otherwise have been the case, but the impact has been marginal. However, recently, fixed rates, some home loan interest-only rates
and investor loan rates have risen partly due to optimism that Donald Trumps election as President of the US will ultimately lead to a
stronger US, and global growth.

At a local level, the property market was affected in early 2016 by APRAs (Australian Prudential Regulatory Authority) 2015 tightening of
lending standards for banks, which resulted in the number of loans to property investors being reduced.

That was offset by the interest rate cuts in May and August that saw the property markets in Sydney and Melbourne heat up again supported
by relative economic strength in those two cities. People felt they could buy property because they had confidence that they would still have a
job due to lower unemployment figures.

However, in Perth and Darwin, the end of the mining investment boom continued to have an impact, weighing heavily on property
investment. Other cities were generally in between these extremes.

Outlook for 2017

Q: Youve recently stated there will be an oversupply of apartments in 2017-18 in certain areas, given apartment building approvals are
running at more than double normal rates. Could the next couple of years provide a good opportunity for savvy investors to scoop up a
bargain-priced apartment?

A: The potential is certainly there when those apartments do come onto the market. Were currently seeing price weakness in apartments in
Melbourne, which I expect will extend to Sydney, Brisbane and Perth over the next year or so. So there will be bargains to be had as the cranes
come down and the apartments come onto the market, especially in the inner city areas of Sydney and Melbourne.

Q: The housing market in Sydney and Melbourne has soared over the last few years with Sydney house prices now averaging over $1 million.
How long do you think these spiralling prices will continue and how will the other capital cities and regions fare in the property stakes this
year?

A: Sydney and Melbourne are at the greatest risk, once they start to come off the boil. Apartments in areas of high supply are most at risk and
could fall by around 15-20% into 2018. Price gains in houses are likely to slow in 2017 with falls of around 5-10% likely into 2018 in Sydney
and Melbourne.

These price drops need to be seen in the context of average price gains of around 60% in Sydney and 40% in Melbourne over the past four
years or so. Home prices in Perth and Darwin may start to bottom in 2017 and moderate house price gains are likely in other capital cities,
although apartment prices are also vulnerable in Perth and Brisbane.
The property market outlook for
2017 - Continued

Q: Home loan interest rates have been low for some time. If the property market starts to slow down in 2017, how do you think the
Reserve Bank of Australia (RBA) will respond?
A: I think its too early for the RBA to start thinking about increasing interest rates just yet, as growth is sub-par and inflation is way
below target. As such, its more likely that the RBA will cut the cash rate in the first half of 2017 rather than hike interest rates.
But given rising funding costs faced by the banks (owing to higher global bond yields) and if the RBA moves the cash rate down in the
first half, the banks may not reduce owner-occupier variable rates by the full amount. Any fall in investor rates may just offset recent
increases.

In short, we dont expect much change in the rates borrowers pay in 2017. By contrast, rates could start to rise more generally in 2018 as
global growth improves and inflationary pressures pick up and this flows through to Australia.

Q: What opportunities are there for home buyers and property investors in 2017?

A: Have patience as prices start to slow and in some cases fall, youre more likely to get a bargain. But this will also depend on whether,
and when, general interest rates increase. Youll need to weigh up all of these factors before you decide to buy into property whether
youre an owner-occupier or an investor.

People put too much stock in whether interest rates are going up or coming down. You are better off assuming some sort of average
over the term of the home loan and try to time your purchase when prices are low rather than high. Often the best opportunities are
found when interest rates are higher and rising.

Important information
AMP Life Limited. This provides general information and hasnt taken your circumstances into account. Its important to consider your particular circumstances before deciding whats right for you.
Although the information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any
investment decision. Except where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader
or any other person.
What financial records do I need
to keep?

Online source: Produced by AMP Life Limited and published on 11 January 2017. Original article.
Print source: By AMP Life Limited, originally published on 11 January 2016 on amp.com.au/insights

Ever feel like you're drowning in a sea of paper? Tame the paperwork today and reap the rewards tomorrow.
Life can be complicated enough without all the administrative paperwork that often accompanies it. This is particularly true when it comes to
your personal finances.
If stacks of old bank statements, utility bills, receipts, insurance and superannuation documents mean you cant see the trees for the paper,
de-clutter, simplify your finances and improve your quality of life today.
Why simplify?
There are many good reasons to pare back on your financial record-keeping, including:
Living in smaller dwellings means we have less space to store documents
Saves time by making it easier to find what you need
Helps your loved ones find relevant documents easily should something happen to you
In the event of a home emergency, you can quickly find important documents you may want to take
Makes your life easier at tax time.
What you need to keep
When it comes to identifying the documents you need to keep, considering your legal obligations is a good place to start.
The first of these is your annual tax return. In order to complete your tax return you'll need documentary evidence of:
all payments youve received, such as wages, interest, dividends and rental income
any expenses related to income received, such as work-related expenses or rental repairs
the sale or purchase of assets, such as property or shares
donations, contributions or gifts to charities
private health insurance cover
medical expenses, both your own and those of any dependents.
You need to keep these documents for five years after you lodge your tax return in case youre asked to substantiate your claims, and its
also a good idea to keep your notice of tax assessments for five years. However, if you run a small business, the document requirements and
timeframes differ find out more at the Australian Tax Office (ATO).
The second category of documents are those related to property such as:
property deeds
home loan documents
renovation approvals
warranties relating to work undertaken.
Other documents to keep include:
wills
tax file numbers
powers of attorney
birth certificates
death certificates
marriage certificates
immunisation records
passports
current insurance policies, such as your life, home and contents, and motor insurance
your most recent superannuation statement
any personal loan documents
vehicle registration
vehicle service history
business registrations
qualifications documents.
What you can throw away
There are some documents you can toss, and as a rule, once a document has been replaced by a newer version, its safe to dispose of the
older copy.
Theres also no need to hang onto credit card receipts once youve reconciled them against your bank statements, unless theyre needed for
warranties.
Credit card and bank statements should be retained for a year, while other household paperwork, such as utility bills, can be thrown away
once paid, unless you need a copy for rental applications or you want to keep them to compare your usage over time.
The exception to these rules is if the documents are required for tax purposes.
Important information
AMP Life Limited. This provides general information and hasnt taken your circumstances into account. Its important to consider your particular circumstances before deciding whats right for you. Although the
information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision.
Except where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.