Money Magazine December 2019

get in financial shape for 2020

Welcome to our year-end special issue. The Best of the Best features 114 reasons to be jolly (page 52). We’ve done the groundwork so you can get started on those pesky finance-related decisions that you may have been putting off for a while. The trick is to start small. We don’t expect you to read this magazine front-to-back in one sitting, but we do hope that you’ll keep referring to the relevant pages when you’re ready to tackle those subjects, whether it’s buying your next car, switching mobile plans or home loans, or investing in a managed fund. With the introduction of the “Protecting Your Super” reforms, we’ve taken extra care in covering the superannuation-related categories. If you can only tick one item off your checklist, make it your super. Your choices…

letter of the month

Retired couple get an electric shock I really enjoy reading your magazine. However, there is one thing I have never heard you mention. When one retires, one also needs to revise the home electricity budget! I remember that it was quite a shock to me and my husband to discover just how much our power bill increased when we were both at home full time. Heating/air-conditioning, TV, radio, computer, kettles and so on being used all day adds up. Virginia Bank comes to the party on interest rates I have been an avid reader of, and subscriber to, Money magazine for many years. I loved Paul Clitheroe “In your interest” article about interest in the August 2019 edition. I made an appointment with my bank manager (one of the big four) to look at options…

what’s the gift you’d like to give this festive season?

DAVID THORNTON David is our staff writer at Money. He says: “I’ll be making a donation to the bushfire relief effort. It’s just heartbreaking to see this kind of loss of property and life, so whatever small contribution I can make to ease the pain is money well spent.” SHARYN MCCOWEN Sharyn, our online content producer at Money and says: “The only gift my beautiful mum will ever request is ‘a book and time to read it’. I’d love to give her all the R&R she needs as a thank-you for everything she does for us.” ANN LOVEDAY Money’s art director Ann says: “A little party in the back garden with friends is my idea of a fullfilling festive time. Sharing delicious homemade food and sunshine with new friends and old. There will be bubbles!” DARREN…

we’ll get a few shocks, but there is no reason to be pessimistic

Can you believe it? Another year goes by. While it was a bumpy ride in the early months, the year panned out closely to my forecasts, and those of other commentators. The key factors were low interest rates, a growing number of jobs, stable levels of unemployment and a growing population. Australian shares, as measured by the All Ordinaries Index, went from 5700 to around 6800 at the time of writing. That is a nice return for the first 11 months of the calendar year. The big east coast cities had their first decent fall in home values in a long time in 2017 and 2018. With these factors in mind, one of my consistent opinions has been to buy property while the downturn lasted. But I was surprised by the price…

check insurance policies for ‘junk’ tpd cover

Consumers would do well to double-check their life insurance policies, including those held inside super funds, to make certain they’re not paying for what is essentially junk insurance. Regulator ASIC says about 500,000 Australians, including many who work in casual roles or high-risk occupations, are currently covered by a total and permanent disability (TPD) policy that is too narrow in definition. The policy only pays out in the most catastrophic circumstances, whereby claimants “are unable to perform several activities of daily living (ADL cover) such as feeding, dressing or washing themselves”. It’s one example where ASIC believes there are design flaws in TPD insurance and the claims-handling process, meaning “consumers can’t rely on this cover when they need it most”. The regulator goes on to say that 60% of claims assessed under this…

banks need to win back trust

This time every year I get asked what was the biggest issue in financial services for the past 12 months. For me the answer is customer remediation. Financial institutions (not just the big four) are attempting to right past wrongs by paying hundreds of millions of dollars back to consumers, and it’s hitting these institutions where it hurts. While this is certainly a good outcome for consumers, I’d suggest they see it as a token gesture and not much else. In our October issue you would have read that, depending on the circumstances, you can be taxed on your remediation payment. What another kick in the guts to those who had previously been ripped off through no fault of their own! The financial services industry could have played its remediation hand much better. It’s…