NAB look at the big picture for Wealth creation

1. NAB look at the big picture for Wealth creation • One hat does not fit all and nab looks to work closely with clients, their accountant and financial planner to look at tax effective wealth creation strategies. • Wealth can be created in many ways however what is common is that “you need good advice and a plan”.

2. Wealth Creation Strategies • Purchasing then selling at a profit after improving the business profitability. • Using surplus monies after loan repayments, living costs/tax to create wealth by purchasing “investment assets” outside of the business. • Repaying borrowed funds from business profits hence increasing financial net worth. • Transition to retirement (super) strategies. • Combinations of all of the above is most times, the reality.

3. Debt restructuring opportunities • Convert debt from principal & interest to interest only basis. • Terms of MLR agreements may have been extended or currently longer than current terms of business debt. Opportunity to change business debt term. • Equity held in the business may have increased enabling further borrowings. • Pay off non deductible debt first. Opportunity to restructure existing business deductible debt to interest only then accelerate repayment to non deductible debt. • ALL SUBJECT TO AFFORDABILITY & FORMAL CREDIT ASSESSMENT

4. Case Study 1 • Mark identified established client that had increased business profits substantially. • Suggested the client obtain revaluation and speak with accountant and financial planner. Business & Unit purchased $1.9m in 2004 and re-valued $2.9m in 2007. Clients had increased net income by approx $150k. • Client took advantage of part extra availability of further lending towards investment funds. Interest only loan of $700,000 was approved for 3 years. • Part equity has been used to diversify investments tax effectively and grow longer term wealth without selling the business.

5. It was identified at first meeting that client was aged 55+ and may be able to take advantage of transition to retirement strategies. Suggested they talk to accountant and financial planner to look at tax effectiveness. Business Debt was structured 3 years interest only to enable flexibility of pay down if desired and free up capital for alternative investment. The difference between principal and interest and interest only was approx $14,000 pa. These monies normally dedicated to debt reduction may have been taxed at up to 30%. Case Study 2

6. Revalue your business and utilise any additional equity for wealth creation purposes. Consider converting your debt repayments to interest only, freeing up income for wealth creation purposes such as salary sacrifice into superannuation. If you have available funds such as a cash lump sum, consider paying down non-deductible debt and recycling it into deductible debt for investment purposes. Utilise a ‘Transition to Retirement Strategy’ to maximise the tax effectiveness of your income. Summary of Wealth Creation Strategies

7. You can continue working whilst accessing an income stream from your superannuation without moving into full retirement phase. Contribute an amount of your income into superannuation using pre-tax (salary sacrifice) contributions. The resulting shortfall between your now reduced income and your ongoing expenses is met by commencing a (non commutable) income stream from superannuation. This income will be tax effective/ tax free dependant on whether you are >55 or >60. Transition To Retirement Strategy

8. Case Study

9. Example Case Study

10. The Total Package Business Insurance Equipment Finance and Leasing General Insurance Business Lending Credit Card and EFTPOS Merchant Facilities Your Business Electronic Banking Trust and General Accounts Personal/ Investment Lending Personal Insurances Super & Non-Super Investments

11. The Total Package • We strongly encourage that before accepting any finance that you contact the NAB to talk to one of our specialists. We will assist you through the whole process and become your longer term relationship manager. We pride ourselves on understanding our customers needs and are committed to helping you fulfil your aspirations.

12. The strategies outlined in this presentation have helped many of our clients achieve success from and in addition to their management rights businesses. Can they help you..? …speak to one of our NAB Business & Financial Planning Specialists.

13. General Advice • Any advice contained in this presentation has been prepared without taking into account your objectives, financial situation or needs. Before acting on any advice in this presentation, NAB recommends that you consider whether it is appropriate for your circumstances. • A Product Disclosure Statement (PDS) or Financial Services Guide (FSG) may be available for products discussed in this presentation. If a PDS or FSG is available, NAB recommends you consider the PDS or FSG before making any decisions regarding a product.

14. Contacts • Gold Coast Business Bank Specialists: • Gold Coast South Financial Services Centre • Level 1, 2 Classic Way, Burleigh Waters QLD 4220 • Mark Brady (07) 5522 3543 / 0404885748Mark.A.Brady@nab.com.au • Gold Coast North Financial Services Centre • Level 1, 27 Scarborough St, Southport QLD 4215 • Matthew Hay (07) 55812151 / 0414733824 Matthew.D.Hay@nab.com.au • Financial Planning Specialists • Gold Coast South Financial Services Centre • Level 1, 2 Classic Way, Burleigh Waters QLD 4220 • Kevin Redfearn (07) 5522 3574 / 0410 443542 Kevin.A.Redfearn@nab.com.au • Matthew Hempel (07) 5522 3546 / 0407 653249 Matt.J.Hempel@nab.com.au