When did the coronavirus outbreak start?

The Chinese Government alerted the World Health Organisation (WHO) of several unusual pneumonia cases in Wuhan on 31 December 2019. In early January, the WHO announced that they had identified a new strain of coronavirus — 2019-nCoV. At the time of this article’s publication, there are over 80,000 confirmed cases and almost 3,000 deaths worldwide.

How do epidemics and pandemics affect industries?

The biggest impact on many industries in an epidemic or pandemic is supply chain delays. Industries rely on specific regions to source parts and products. Using the coronavirus outbreak and assembly lines for technology products, as an example, people in assembly lines typically work in close quarters. To contain the outbreak, factories in China have delayed restarting production after the Lunar New Year break. One smartphone factory, Foxconn, is expecting a 12% decrease in production as a result.

Tourism is another key industry effected by epidemics and pandemics. In Australia, measures to contain coronavirus, including halting incoming flights from China will have significant impacts on the tourism and education industries. An economist at ANZ expects Australia’s economic growth to decline by 0.5% in the first quarter due to fewer tourists visiting Australia and a delayed start to the academic year for international students.

How are individual businesses effected by epidemics and pandemics?

Businesses within the sectors most impacted by epidemics and pandemics experience the effects of an outbreak first. In Australia, for example, travel booking company Webjet experienced a 10% slump in its share price in late-January following the coronavirus outbreak. Other companies such as JB Hi-Fi and Harvey Norman have said their supply of electronics could be disrupted.

Small and medium businesses can often be the hardest hit. Businesses such as restaurants and retailers in tourist hotspots and tourism services companies will be among the hardest hit in Australia over the coming months.

How long does it take for markets to recover after an epidemic?

Market recovery following an epidemic is dependent on a range of factors. Following the SARS outbreak, for example, the Chinese Government deployed fiscal stimulus to aid in economic recovery. At the time of the SARS outbreak (first quarter of 2003), China’s economic growth was 11.1%. By the second quarter, the country’s economic growth fell to 9.1%. As the outbreak was contained, and fiscal stimulus was deployed, China’s economic growth recovered to 10% by the third quarter of 2003. Looking at other markets, the S&P500 posted a gain of 14.59% following the first confirmed case of SARS. The index posted a gain of 20.76% a year after the outbreak.

How will an epidemic or pandemic impact my investments?

The economy has changed since the SARS outbreak. China is now a much larger part of the global economy, accounting for around 17% of global GDP, compared to 4% in 2003, so the economic impacts of coronavirus may be more pronounced. The best thing investors can do right now is exercise caution and make sure their portfolios are defensively positioned.

To discuss how your investments may be impacted by coronavirus speak to your LT financial adviser. Your financial adviser can help you protect your wealth by implementing suitable  strategies to minimise the impacts of these events on your portfolio.

The post The true cost of an epidemic appeared first on Newcastle Financial Planners & Financial Advisors.

Many people go through enough pain and grief when dealing with their illness or injury, let alone the stress that comes along with not having an income to support their family. That’s why it is important to ensure you have the appropriate risk insurance or risk cover in place.

Risk Insurance A Claimant's Story

Geoff and his adviser David’s real names have not been used to protect their privacy.

Geoff thought the world was at his feet as he prepared himself for retirement, until he was diagnosed with a life threatening illness.

The following is an extract from a letter Geoff’s insurance provider received from him…

Six weeks ago I was diagnosed with bowel cancer and secondary liver cancer.

My initial diagnosis was three to six months and I was facing the possibility of a major operation to remove the cancer in my bowel. By the afternoon, after my second visit to the specialist, my life expectancy had been reduced to between six weeks and three months.

I phoned my insurance adviser David, who I had known for 19 years and who had originally assisted in putting my insurance cover in place. Within three days of submitting a claim, I received my first payment of $653,535 and then another payment which brought the total payment to over $1.2 million.

Although I have not met the people who have been involved, David kept me informed of everyone’s efforts to ensure that my claim was processed in the most efficient manner. I am sure this has a lot to do with the excellent relationship that he has with my insurer and the fact that the right advice was given in our situation.

I would like to express our thanks for relieving me of the financial burden and worry that I would have faced if I did not have this cover.

The payments from his insurance enabled Geoff to obtain an expensive medical treatment from Japan, only available to a few patients around the world. After taking this medication for over six months, Geoff was recently informed that his once-inoperable cancer is now operable.

This surgery will hopefully extend Geoff’s life expectancy significantly, enabling him to spend more time with his family.

Speak with your financial planner today to ensure you have adequate risk cover in place.

Source: AIA Australia Limited, June 2011

Our Newcastle Financial advisors are happy to help discuss your risk cover needs and risk insurance options.

Risk Insurance

The post Risk Insurance appeared first on Newcastle Financial Planners & Financial Advisors.

One scenario where a short-term loan may be allowed, arises when a fund is in trouble during the process of settling an investment purchase, such as shares. If some shares are sold and others bought, yet the cash for the first transaction has been slow in coming, then it is possible that a short term loan could be procured. The loan period should not exceed seven working days and the amount should be no more than 10 per cent of the all the assets of the fund.

Another possible scenario occurs where a trustee is required by law, or by the fund’s rules, to pay a benefit to a member or a tax liability for which the fund does not immediately have the cash. The fund can borrow so long as the period of the loan does not exceed 90 days and the total amount borrowed is no more than 10 per cent of the value of the total fund assets.

If any loan is made, it is essential that the fund take all means to ensure that money is freed up to pay off the loan. It is a breach of super fund rules for the fund’s account to be in deficit for longer than seven days. The rules indicate that loaning money to super funds can only occur in unexpected situations. It is important to get advice if a super fund is in the red, especially as the end of the year approaches.

Speak with one of our Newcastle financial advisors to gain professional financial advice.

This article is for guidance only, and professional advice should be obtained before acting on any advice herein. Neither the publisher Leenane Templeton The Self Managed Super Specialists nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication. See "Self managed super funds"  website for further information. This article relates to Australia, NSW and does not take into account any legislative or other changes made after 1 April 2011.

The post Quick Cash & DIY Super Funds at Year End appeared first on Newcastle Financial Planners & Financial Advisors.

Andrew was commenting on the SuperRatings study that unclaimed superannuation has reached a staggering $5.4 billion held in more than 6.1 million accounts in Eligible Retirement Funds at 30 June 2010.

Unfortunately, due to new regulations which came into effect in October 2010, if the money is not claimed it will eventually find its way into consolidated revenue, including windfalls for the ATO, which is reported as receiving more than $100 million in the first tranche of money transferred.

If you think you might be the owner of one or more of the 6.1 million accounts, search the online ATO Superseeker site https://superseeker.super.ato.gov.au.  Superseeker is quick and easy to use and is free.  It is a tool to assist you to look for your lost and unclaimed superannuation and it will also assist you to lodge a request to transfer the monies to the super fund of your choice.

To complete a search you must provide your

• Tax File Number (TFN)
• Family and Given Names
• Date of Birth

Andrew is imploring everyone to not be apathetic, to search now before it is lost to you forever, commenting "You have nothing to lose and a possibility to gain".
 

Visit our other websites for:

Self Managed Super Funds

Newcastle Accountant

Newcastle Financial Advisors

The post Why Give Away Your Money? appeared first on Newcastle Financial Planners & Financial Advisors.

One of the first things in controlling your money and your accumulation of wealth is to have a budget.  However, many of us do not have a budget, do not treat our money as if it was a business and wonder why we are not able to save satisfactorily.  Budgeting is a way or empowering yourself, to enable you to have control over your money. 

Many people draw up a budget that unfortunately has oversights and which can render the budget useless.  To ensure you create a realistic budget we hope the following points will assist you..

Run Your Life Like A Business

If you were a business you certainly wouldn't be happy to break-even or make a loss at the end of the year, and you shouldn't be happy doing this in life.  Aim to make a profit through proper budgeting, savings and investments.

Include Annual and Quarterly Expenses

Budget for your weekly and monthly expenses like rent or mortgage payments, food, fuel, telephone, electricity but don't forget to also include rates, house and other insurances, car registration that may be non-monthly expenses.

Unexpected and Irregular Costs

Many people forget to put money aside for unexpected costs such as car repairs or medical expenses and house repairs and maintenance.  These costs are more irregular than unexpected because we do know that our cars and houses require maintenance as do our bodies!  So put extra aside to cover irregular costs – earn interest on these savings until the money is needed.

Remember We Learn From The Past

History teaches us a lot, so ensure you look at past expenses.  Not only can you tell the costs of past car repairs and service costs, you can track when your electricity or water costs peaked perhaps with a hot summer and also medical expenses can be averaged out.

Positive Savings Plan

Rather than just saving what is left over, have a positive savings plan – decide how much you want to save and regularly put that amount aside and stick to it.  Then when you have the money you can buy what you need.  Some of our team at Leenane Templeton get the bank to take out 10% of their salary as it's deposited into their account and place this into an investment account, this accumulation of savings becomes unnoticed and if managed properly can become a significant investment through compounding.  Speak with a financial advisor in order to see what financial plan suits your particular circumstances.

Emergency Funds

Paying attention to your savings will help you build an emergency fund to see you through some unexpected times perhaps through job loss or severe illness.  Try and have at least three months worth of emergency savings.

Credit Card

Do pay your credit card off each month and not incur horrendous interest costs.  If you can't afford to pay it off you should not have purchased the goods.  Be careful with your spending and your saving and you will be amazed how much you can achieve.

It's Little Things That Add Up

That $4.00 coffee collected each morning on the way to work can cost you $80 a month, add any money you spent on take away lunch and the dollars really add up.  Consider having your own filter machine at work and bringing your lunch from home (even just for a few days a week) and you will be immediately benefitting from the savings for your budget.

Be Realistic

Be as accurate as you can be with what you know, but don't set unrealistic targets.  You will only become dissatisfied and then disillusioned with the whole process.  Having a budget is not to stop you spending, it is to ensure you have control, you can set your priorities and not feel guilty about spending.  It is to help you understand where your hard-earned money goes and when and how you spend or save.  Budgetting is about empowering you not about stopping you enjoying yourself.

Don't Overdo It

You don't have to account for every cent you spend every day.  Don't let your budgetting become a chore.  And don't be too hard on yourself, remember your earn money to enjoy yourself.  If you have not eaten out in a month and have that money set aside and would like to attend a concert with the money do so.  (As long as you aren't going to be cross with yourself!)

It's Not Set in Stone

Budgets are living documents and can be changed as circumstances change, your income may increase  and some new expenses come to light so amend your budget.  Be flexible and as accurate as possible.

Keep Written Records

Keeping numbers in our heads can lead to inaccuracy, so it is best to keep written records.  This adds discipline as well as accuracy.  This is your personal business.  Keeping a simple spreadsheet will assist.

Disclaimer

The information contained in this document is based on information believed to be accurate and reliable at the time of publication.  Any illustrations of past performance do not imply similar performance in the future.

To the extent permissible by law, neither we nor any of our related entities, employees, or directors gives any representation or warranty as to the reliability, accuracy or completeness of the information,  or accepts any responsibility for any person acting, or refraining from acting, on the basis of information contained in this communication.

This information is of a general nature only.  It is not intended as personal advice or as investment recommendation, and does not take into account the particular investment objectives, financial situation and needs of a particular investor.  Before making an investment decision you should read the product disclosure statement of any financial product referred to in this newsletter and speak with your financial planner to assess whether the advice is appropriate to your particular investment objectives. financial situation and needs.

For business advice go to www.newcastle-accountant.com.au

.

The post Budgeting For 2011 appeared first on Newcastle Financial Planners & Financial Advisors.

We have a professional team of Chartered Accountants, CPA qualified staff, taxation specialists, wealth management experts, financial planners, business accountants, business advisors and marketing expert in order to help you in all areas of your life whether you are just starting out or in retirement.

Our firm has regularly financial events including SMSF Trustee Seminars, Financial planning seminars and even Business bites a seminar designed for business owners to maximise chunks of information from guest speakers over a lunchtime.   Please feel free to call our team or subscribe to our Newcastle office financial updates through email.  We look forward to working with you 

For more details about our firm you can visit 

Business Accountants in Newcastle

SMSF Specialists

Financial Advisers in Newcastle

Chartered Accountants

We look forward to working with you over many generations. 

The post Financial Advisers in Newcastle – New Web Site appeared first on Newcastle Financial Planners & Financial Advisors.