2011 -12 Budget Briefing

1. 2011 -12 Budget Briefing Superannuation • Refund of excess concessional contributions. • One off • Max $10,000 concessional • From July 1, 2011 Issues • Doesn’t address previous concessional contributions • Errors not picked up for years (ATO way behind) • Fails to address impact on large non-concessional contributions • Minimum payment draw down relief extended in 2011/12. • Extension of reduced amounts for 2011/12 at 75%, rather than 50% currently available. • Back to normal levels from 01/07/2012. Issues • Review with your adviser, we can easily adjust levels for you.

2. Example Jackie, age 60 has an Account Based Pension to the value of $400,000 and has elected to take the minimum pension draw down. Required draw down 2010/11 = $8,000 (50%) 2011/12 = $12,000 (75%) 2012/13 = $16,000 (Regular)

3. Concessional contributions cap • Continuation of $50,000 concessional cap for those over 50 from 2012, iftheir account is less than $500,000. Issues • How and when will the $500,000 be counted? • Will pensions, withdrawals etc be added back? • This has got “Stuff Up” written all over it! • Those still working with balances close to $500,000 could consider various strategies to stay under the $500,000 level and therefore potentially extend their ability to heavily salary sacrifice. • Review with your adviser

4. 2011 Budget Briefing Taxation • Limitation of the ability of minors (children under age 18) to access the low income tax offset (LITO) from 1 July 2011. • Tax rates unchanged however a temporary flood and reconstruction levy introduced from 1 July 2011 for individuals earning more than $50,000. • Car Fringe Benefits Tax – Current valuation factors using the statutory method will be replaced by a single valuation factor of 20% by 1 April 2014.

5. Active Asset Management Service CORE SATELLITE

6. Your current portfolio $ • Specialist Fund Managers • Large (ish) • Active (Alpha) • Blend of Styles in portfolio • Value • Growth 4 Australian Shares

7. Why Change ? • Times have changed • Markets are more volatile • Proven 94% return generated by asset allocation • More efficient portfolios • Reduce costs • Potentially increase returns

8. Active Management Approach Tactical Asset Allocation Enables us to monitor Asset Classes for Overselling and Overbuying • More indepth Research – Farrelly’s • Long term outlook – 5 to 10 years • Repeatable - works right through the cycle • Objective – based on fact… not emotion • Timely • Updated monthly • LAMA – LIMITED authority to change profile • CFS = T+1

9. Core of your new profile • Market (Beta) • Index Funds • Enhanced Index Funds • Low cost • No surprises

10. Satellite / Active Alpha Management • - Low correlated, complement core component • Active Managers • Brain Power • Non-correlated • Small (ish) • Can move quickly

11. New Core Satellite Approach Satellite Platinum Huge in Australia but small in world • Efficient / responsive •  investment costs •  potential returns • CORE • Market returns •  Costs Satellite Fidelity Huge in the world, 1% in Aust Market

12. FFA Service • 10 Actively managed portfolios • Monitored monthly • Portfolios updated as necessary • Client portfolio updates implemented immediately • Record of advice provided • Plus all usual services – Client functions, Seminars, Monthly Newsletters

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