Personal insurance concepts

New To Getting Personal Insurance?

These 3 articles explain the different Personal insurance concepts:

  1. types of Insurance and potential uses
  2. how much cover do you need?
  3. ways to make life and TPD insurance more affordable

Did you know?

In a recent survey, 46% of Australians admit that they live ‘pay cheque to pay cheque’ including:

  • 1 in 4 households earning over $150,000 pa, and
  • 1 in 5 households earning over $200,000 pa.1

Seek advice. A financial adviser can help ensure you have the right insurances in place to help protect your family’s lifestyle. The first step is having the conversation. Contact Dev Sarker at 1300 717 136 today!


1 Research conducted by IPSOS on behalf of MLC in August 2015 and published in February 2016 in ‘Australia today – Part 1: A look at lifestyle, financial security and retirement in Australia’.

InReview: Perspectives on the future of the global economy (video)

Hamish Douglass, Magellan’s Chairman and Chief Investment Officer, spoke with Janet Yellen, the most recent former chair of the Federal Reserve, and an adviser to Magellan, about the covid-19 health and economic crisis.

The pair discuss the response of the Federal Reserve and how the crisis of 2008-09 has given guidance to the response. They talk about the economic impact and Janet explains why a Nike swoosh-like recovery is more likely than a V-shaped bounce back. They discuss the struggles of emerging markets, the risk of inflation and end on what they find to be optimistic about.

Watch the 46 minutes video here.


Managing the COVID-19 crisis–an update on Government policies that might affect you

The ongoing Coronavirus crisis is all over the news and while the reports from Victoria are concerning, it’s good to remember that in absolute and global terms Australia is still managing the medical crisis exceptionally well. That said, the lockdowns, border closures and general loss of consumer and business confidence have affected the economy and so the Government has stepped in with massive support measures.

The massive cost of those measures—and better data about the crisis—means the government has recently proposed some changes to the conditions of some of their main measures.

Here’s a summary.

1. JobKeeper Payment

Under the JobKeeper payment, businesses that meet certain criteria can get a subsidy from the Government to continue paying their employees. Eligible employers need to apply to the ATO for the payment on behalf of their employees.

By keeping employees ‘tied’ to their jobs, JobKeeper is designed to maintain employment. Typically getting people back into the workforce is one of the most difficult economic problems caused by recessions.

JobKeeper was due to cease on 27 September.

The Government has proposed to extend the JobKeeper program with the payment to be reduced over time and paid at two rates. The two rates relate to whether you’re considered to be a full-time or part-time worker for this purpose, and is intended to be determined based on the hours you worked in the applicable test period. Depending on your circumstances, this test period will be either February or June 2020. Full-time workers are those who have worked more than 20 hours in the applicable test period.

From 28 September 2020 to 3 January 2021:

  • the payment rate will fall to $1,200 each fortnight for full-time employees, and
  • $750 each fortnight for part-time employees.

From 4 January 2021 to 28 March 2021, the JobKeeper payment rate will be:

  • $1,000 each fortnight for full-time employees.
  • The rate for part-time employees will fall to $650 each fortnight over this period.

To find out more, including whether you’re an eligible employee, visit the Federal Government’s JobKeeper payment web page

2. Income support for individuals

The Government has implemented some temporary measures to enable more people to access some social security benefits and concessions. This includes temporarily relaxing some of the eligibility criteria for certain payments.

The Coronavirus supplement also temporarily increases the total payments available to eligible social security recipients.

  • Payment of the Coronavirus supplement of $550 per fortnight for those already receiving a qualifying income support payment continues until 24 September 2020.
  • The Government has proposed to extend payment of the supplement to 31 December 2020 at a reduced rate of $250.

The supplement is taxable and is paid automatically to people receiving an eligible payment or benefit. The list of qualifying income payments is available here.

If you’re receiving JobKeeper payment from your employer, this must be declared as income if you’re applying for or receiving any payments or benefits.

You can register online via MyGov or by phone for social security payments and other concessions.

3. Economic support payments for pensioners

Two payments of $750 each were made to people receiving certain social security payments and eligible concession card holders. The first payment was made from 31 March 2020 and the second payment was paid around 10 July 2020.

Importantly, these payments are not taxable and don’t count as income for the purposes of social security, Farm Household Allowance and veteran payments.

Contact Services Australia at to discuss the full range of benefits and concessions that may apply to you.

4. Access to your super

Whilst your super is designed to provide for a better lifestyle in retirement (via long-term investment), the Government is allowing temporary early access to super for certain people who are in financial difficulty as a result of COVID-19’s impact on your finances.

Eligibility rules apply to determine whether you’re able to make a withdrawal under this temporary measure.

From 1 July 2020, you can submit one request for an early release of up to $10,000 of your super—this is the second stage of the Government’s early release of super program, with an amount up to $10,000 also being available for release up to 30 June 2020.

Originally, applications for an additional lump sum in the current financial year needed to be submitted by 24 September but the Government has proposed to extend this date to 31 December 2020.

To apply for a release of your super under this temporary measure, applications need to be made online via MyGov. The ATO will then contact your fund to process the release.

It’s important to remember that any money you take out of super now leaves you less money invested for retirement. While it may make sense to draw on your super now if you are in financial need, a chat to a financial adviser may help you balance your current cashflow worries with your long-term lifestyle needs.

We are here to help you navigate your finances during COVID-19. Contact Dev Sarker at 1300 717 136 today!

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Four tips to get your super back on track

Like many Australians, you may have dipped into your super early as part of the government’s Coronavirus financial hardship scheme. While the extra funds can come in handy right now, it’s important to keep sight of the bigger picture.

If you lost your job or had your hours reduced due to the impact of the Coronavirus, you may have taken advantage of the government’s early release of super scheme and dipped into your super to help with your living expenses.

Once you’re in a more comfortable financial position, it may be time to think about how you will rebuild your super balance to minimise the long-term impact on your retirement savings. This is especially important when you’re young because of the power of compounding returns over time. You can use the government’s moneysmart super withdrawal estimator to see how much of an impact the withdrawal may have on your retirement, so you can work out how much you need to rebuild.

Here are four simple suggestions for how to get your super back on track again.


If you didn’t need to use all the money you withdrew from your super, you can add it back to your super account as a one-off contribution. As well as boosting your balance, this might allow you to reduce your income tax (if you’re eligible to claim your contribution as a tax deduction).

Keep in mind, however, that the ATO is imposing penalties for anyone they determine has taken money out of super and then recontributed it for the sole purpose of obtaining a tax deduction. You can read more about it on the ATO website.


If you’re back at work now and earning a wage, check whether your employer supports salary sacrificing. This is using part of your before-tax salary to contribute to your super, on top of the 9.5% Super Guarantee contributions your employer already makes for you. It will also reduce your taxable income, which means you could potentially pay less income tax.

Regularly putting in extra money to top up your super can make a big difference to your balance over time. For example, this chart shows the difference contributing a small amount each pay could potentially make to your super balance at retirement.1

Salary sacrifice per week Super balance at age 65 Difference
$0 $168,605
$10 $180,260 $11,655
$20 $191,915 $23,309
$30 $203,569 $34,964


1. Assumptions: This example assumes an initial super balance of $0, a salary of $65,000 p.a. and a weekly salary sacrifice of $10, $20 or $30 per week over 25 years. Current age is 40, and retirement age is 65 years old. Results are in today’s dollars, adjusted for annual inflation of 3% CPI and 3% of rising community living standards. The balanced investment option assumes an investment return of 3.46% p.a. after fees and tax. Source: CFS First Tech Team.


If you’re lucky enough to come across a lump sum, it could make sense to put all or some of this money into your super. For example:

  • a redundancy payout
  • a tax refund
  • an inheritance
  • the proceeds from a sale, such as a car or your house.

Just remember that there are limits around how much you can contribute to super each year. Currently, you can make up to $25,000 in before-tax (concessional) contributions and $100,000 in after-tax (non-concessional) contributions each financial year.2 If you go over these caps, you may have to pay additional tax.


How your super is invested may make a difference to how long it takes your balance to recover. Typically, growth assets like property and shares have higher returns than defensive assets like cash and fixed interest. Most investment options in super funds have a mix of both growth and defensive assets.

Check your latest statement, log on to FirstNet or download the Colonial First State app to see if your investment strategy is appropriate for you. If you’re not sure, get in touch with a financial adviser. Contact Dev Sarker at 1300 717 136 today!


Industry Insight by Bob Cunneen

Bob Cunneen, senior economist and portfolio specialist, MLC Asset Management

This content is produced by The Australian Financial Review in commercial partnership with MLC.

History is scarred with dramatic events that can shatter economies and political systems. Just over a century ago, the terrible suffering of World War I and the Spanish flu pandemic marked the start of a tumultuous period for the global economy. Communism and fascism came to the fore as capitalism and democracy descended towards the abyss with the Great Depression in the 1930s.

Does the coronavirus pandemic in 2020 mark the starting line of another “low dishonest decade” that the poet WH Auden lamented of those times? Alas, we do not know what the long-term future holds.

So, is there any reason to hope of better times ahead? No-one can be sure.

There are promising signs this virus can be contained by effective public health advice, testing and tracing processes. Conversely, without a widely available vaccine, a return to our pre-coronavirus lives seems very distant.

Where business and consumers can draw some solace is central banks and government have recognised this health and economic crisis as a pervasive threat. The policy responses in terms of central banks expanding their balance sheets to support credit availability has been bold. The US Federal Reserve has expanded their balance sheet by an extra US$2.8 trillion or 14 per cent of Nominal GDP by buying government and corporate bonds as well as mortgage securities.

The Reserve Bank of Australia (RBA) has crossed the Rubicon by providing a “funding for lending” program to the banks to support business lending as well as buying government bonds to keep yields lows. While it’s only a modest 7 per cent of Australian GDP, the RBA is playing a constructive role.

Governments have also opened up their spending taps. Australia’s $214 billion in fiscal stimulus measures is at the modest end of the spectrum at 10 per cent of GDP compared to the US at 14 per cent and Germany at 28 per cent.

However, there is likely to be criticism from some on the effectiveness and scope of these stimulus measures.

The recent discovery of a $60 billion shortfall in Australia’s JobKeeper payment for example could be used to suggest the federal government could have been more generous in providing benefits to those employees of small businesses who did not meet the -30 per cent decline in revenue threshold.

As the pandemic continues there is likely to be persistent requests for the government to extend support benefits to those in the gig economy and recognise the dramatic loss of income for those in the arts and higher education sectors.

We also need to take into account that the coronavirus may have dramatically changed our behaviour for a very long time. The RBA’s May policy statement noted the “current economic disruption … could also affect mindsets and the behaviours of consumers and businesses”.

For example, will people continue to catch crowded buses and trains, or catch flights for business or holidays given the recent trauma? Arguably, business models for many industries have changed dramatically with this virus.

Global politics may also have been transformed by the pandemic. The peak in globalisation may have passed and an age of protectionism been initiated. Nations will look to become more self-sufficient in key areas such as food and health equipment.

President Trump’s “America first” rhetoric could potentially be echoed across the world as nationalistic voices try to rally voters with promises of keeping jobs at home. China’s status as the “factory to the world” is likely to diminish. Global corporations are likely to diversify their manufacturing bases to places like India, Indonesia and Vietnam to manage political risk.

Australia’s challenge is we are a very small economy heavily reliant on commodity exports, education and tourism. We try to “punch above our weight” but regrettably we do not have the reach and reflexes to mitigate all the blows of dramatic global economic and political changes. So the key advice to investors in these troubling times is to remain flexible and nimble to avoid being put on the canvas by this virus.

Find out how BlueRocke financial adviser can help you through these difficult times and reach out if you need any assistance. Contact Dev Sarker at 1300 717 136 today!

Source: MLC