Welcome to the December issue of Financial Insights and Updates.
Our feature chart and article this month, ‘Impossibly Unaffordable Cities, The World’s least affordable housing markets in 2024‘, looks at housing markets across the world, comparing the median house price to median household income ratio, with Sydney being ranked 2nd least affordable city in the world.
Some other interesting articles this month include ‘5 Psychological Traps Hurting Your Investments’ which discusses behavioural biases that can significantly impact your investment portfolio and how we can overcome those biases, and ‘How a Super Recontribution Strategy Could Improve Your Tax Position’ which details how withdrawing part of your superannuation fund balance then paying it back into the account, known as a recontribution strategy, may sound a little strange but it could deliver a number of benefits including reducing tax and helping to manage super balances between you and your spouse.
As always, feel free to forward any articles to friends and/or family that you feel may benefit from the information.
In signing off, please remember that we are always available to answer any questions or queries you may have and to come speak with us before making any major investment decisions.
Warm regards,
The K Point Wealth Team
Feature Article:
5 Psychological Traps Hurting Your Investments
Market trends aren’t the only factors affecting your investment portfolio—behavioural biases can significantly impact your returns.
These psychological tendencies, like confirmation bias and herd mentality, often lead to poor investment decisions.
Behavioural biases are mental shortcuts or blind spots that can mislead us, even when our choices seem rational.
Understanding the most common biases and their impact on our investment decision-making is crucial for achieving the best possible returns.
Caregiving can have a retirement sting
Around 3 million Australians are unpaid caregivers. Most face a super risk.
In many ways, caregivers are unsung heroes. Their work is invaluable, but they are typically forced to forego paid employment and also miss out on precious compulsory superannuation payments that would otherwise have been paid by an employer.
As research by Vanguard shows, the financial cost of caregiving can be very costly over time and can have a significant impact on retirement savings balances.
How a Super Recontribution Strategy Could Improve Your Tax Position
Withdrawing part of your superannuation fund balance then paying it back into the account, known as a recontribution strategy, may sound a little strange but it could deliver a number of benefits including reducing tax and helping to manage super balances between you and your spouse.
Health Spotlight – What is lung cancer
What is lung cancer? Lung cancer is one of the leading causes of cancer-related deaths in Australia.
In 2023, about 14,782 Australians were diagnosed with lung cancer.
Lung cancer is the leading cause of cancer deaths with a reported 8,691 deaths in 2023.
It is the fifth most common cancer in Australia and accounts for 9% of all cancers diagnosed.
How to Ensure Your Savings Benefit Your Loved Ones
Most of us work hard to save for our retirement, and thanks to tax concessions and compulsory contributions, superannuation often forms a large part of retirement savings. But it’s essential to understand who controls where your super goes if you pass away and how to ensure your loved ones receive the inheritance you want them to have in the most effective way.
It’s a common misconception that you can include your superannuation as part of your Will. However, this is not the case, and you need to take action before you pass away to make it possible.
Why the cash rate is being kept on hold
The RBA is unlikely to start easing interest rates until the second quarter of 2025.
“The board needs to be confident that inflation is moving sustainably towards the target and we need to see more progress on underlying inflation coming down.”
That was the bottom line from Reserve Bank of Australia (RBA) Governor, Michele Bullock, last week in justifying the central bank’s decision to keep its policy cash rate on hold at 4.35%.
