Budget 2019

2019 Budget

Below is a quick summary of the main announcements of this year’s budget, more detail will come out over time. For working Australia this Budget has a number of incentives and positive outcomes in real time. Other measure will take sometime to filter through.

Time may not be in the Governments side to get these measures through, with the election now on. As expected this budget is all about getting the votes. The power is now in our hands; we the voters now have the ability to decide where our country is going in the next 10 years.

Individual Tax Cuts  

Increase to low and middle income rebates (LMITO) will move up to $1080 from $530.

Tax Brackets will be adjusted of the next 5 years.

o   2019 year you will save between $400 to $1200 in tax.

o   2023 year you will save between $400 and $2500 in tax

o   2024 all adjustments will have come through delivering tax cuts between $500 and $12,000 depending on your income

This will benefit more than 10 million people earning up to A$126,000 a year.

From July 2024, the government will cut the 32.5 per cent marginal tax rate to 30 per cent, applying to all taxpayers earning between A$45,000 and A$200,000.

The top 5 per cent of taxpayers will pay one third of all income tax collected.

Business – instant write off extended, Apprenticeships, Infrastructure and increase in Fees.

The instant asset write-off will be extended to June 2020 and increased from A$25,000 to A$30,000. The write-off allows small business with a turnover of less than A$10 million to claim an immediate deduction for a purchase below that amount. It will also be expanded to businesses with turnover of up to A$50 million, or another 22,000 businesses. 

Businesses will also be able to claim the deduction every time they make a purchase under the cap.

The government announced increased investment in infrastructure spending, to improve rail links and address road black spots, Queensland is the big winner here. These large future looking infrastructure spend will stimulate jobs and local economies and prove employment in both private and public sector.

A $525 million skills package would create 80,000 new apprenticeships in industries with skills shortages and double to $8,000 the incentive payments to employers per apprenticeship placement.

There were also announcements to create new training hubs, give new apprentices an A$2000 incentive payment, and invest in science, technology and research.

There is always a down side and for business it is that they will pay more fees to regulators, through the industry funding model for the Australian Securities and Investments Commission (ASIC) and higher levies to the Australian Prudential Regulation Authority (APRA).

As part of a response to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, there will be extra funding to ASIC of A$38.5 million in 2019/20 and A$118 million in 2020/21, possibly funded by extra fees to business.

Age Care and Pensioners  

Frydenberg announced A$725 million for aged care, with 10,000 new home care packages and capital works focused on regional Australia.

Single pensioners will get an A$75 one-off cash payment for their energy bills, while couple pensioners will get A$125.

Superannuation – work test for Non-Concessional contribution extended

People approaching retirement will be able to boost their superannuation balances, with those aged 65 and 66 years able to make voluntary contributions without satisfying the work test, from July 1 2020. Currently, people aged 65 and older must work a minimum 40 hours over a 30-day period.

People aged 65 and 66 will also be able to access the “bring forward arrangements” to make three years’ worth of non-concessional contributions(capped at A$100,000) to their super in a single year. This currently stops at 65 years.


This is only a quick look at some of the highlights in the budget, there will always be ongoing debate on the budget depending where you sit and how it affects you. The key take away is that average working person will get some tax relief to assist with the ever increasing cost of living in Australia.

With a large forward looking infrastructure spend we will not only see jobs created but also the moving to a more sustainable way to live into the future. The catch is will LNP be around to implement this budget?

That is up to you!

Tips and Education

April 3, 2019

Don’t miss these stories:

Read this before investing in the stock market.

Read this before investing in the stock market.

Companies also make profits and losses. When a company makes excess money, they have two choices:
1. Invest the money into growing the business by acquisitions or improve internal efficiencies to reduce costs.
2. Pay some of the surplus cash back to shareholders through dividends. Dividends may also come with franking credits as well.
Types of shares
Growth stocks are those companies that are considered to have the potential to outperform the overall market over time because of their future potential.
Value stocks are classified as companies that are currently trading below what they are really worth and will thus provide a superior return.
Diversification is a risk management strategy that mixes a wide variety of investments within a portfolio. A diversified portfolio contains a mix of distinct asset types and investment vehicles in an attempt at limiting exposure to any single asset or risk.
It is important to ensure that you do not under or over diversify your portfolio. The general rule of thumb is 20 shares in the portfolio however you would hold more for a large portfolio.
Risk Profile
Your risk profile sets out how much exposure you should have in each sector of the market such as Australian shares, International Shares, Property, Fixed interest and cash. How much weighting you have in each sector will increase or decrease depending on your risk profile.
There are five basic risk profiles:
1. Conservative
2. Moderately conservative
3. Balanced
4. Assertive
5. Aggressive
Before investing you should complete a risk profile to make sure you are investing at a risk level you are comfortable with. Getting this wrong will lead to bad financial decisions.
Most common mistakes made when investing in the stock market.
1. Getting stock tips from friends or family.
2. Not understanding the company, or investment you are buying.
3. Trying to time the market.
4. Panic when the market pulls back.
5. Lack of diversification
Make sure you understand the company you are looking to buy. There is a lot of information on the internet but not all of it is there to help you. We recommend that you get professional advice. Professionals who work in the industry have access to research houses with daily updates on different shares and latest news on each company.
Accept that there is no free advice. Free advice is normally a sale pitch. There are a number of good research houses, but you will have to pay for them.
When starting, you will be best off having a stockbroker, it will cost more but a good stockbroker will save you more money than what they charge.
Market Fluctuations
The stock market is forward focused. It is looking at what is going to happen in the future and how this will affect the different companies which make up the stock market. Bad news may see the market in general fall, this does not mean that your shares are worthless it is the market building in a buffer. Same goes for good news when share prices are trading above their fair value.
Market fluctuations are an opportunity to either add to your holding at a discounted price or sell out part of your holding to take some profits. This call rebalancing, when to rebalance back to your risk profile.
Investing in direct equities provides you more control over your investments, which will generally lead to a better overall outcome for you the investor. But it is important to make sure you understand how it works before you start investing.

Investing is about, not losing money.

Investing is about, not losing money.

If you fail to plan, then you plan will fail. The first step in any endeavour is to understand what it is you want to achieve. You then need to plan out how you will achieve this goal. The big lie is that everyone can be a winner.  This is not the case the world...

How the 1% Invest

How the 1% Invest

For those aspiring to grow their wealth, there is a simple lesson. The top 1%, invest 61% of their wealth in one asset. Click for article