Do you know what assume means

Do you know what assume means?

Do you know what assume means was a question a builder client asked us sometime ago?
We had to admit then that we didn’t know & so a brief translation was provided and starts off as ‘the mother of all’.

This has been the recurrent & comment mistake by government over recent times & something we never do with our spouse. I.e. we assume that all our taxx is well spent and the banks are as safe as houses & Kevin Flip flop is action what he spins a promise.

I.e. assume that property always goes up. Have we all forgotten all of that frozen funds in property trusts. Lets recall Centro which was the lead player before the GFC & was in fact in ‘the too big to fail’ category. Yes this is commercial property, such as retail office & offices. The banks are propping these funds up as otherwise the banks will need propping up. We have no expectations of residential prices doing other than a similar slide as elsewhere on the planet. Why else are we any different.

So we see from the Henry report the assumption that mining companies will pay a 40% super profits taxx RSPT as it will be good for your superannuation & infrastructure & whatever. That is a very big assumption as so far all super funds with any exposure to resources stocks have fallen 15%+. Thanks heaps. Ross Garnaut of Lihir & an economist was also questioning the treasury assumptions. One of them is China will continually grow & need our resources.

A big assumption is that this RSPT will kick in once companies earn over the risk free rate of 6 %. Risk free is benchmarked to government bond rate. We only need to read of ‘sovereign risk’ in Europe to be very aware that this risk has significantly increased. We attended a presentation by a fund manager recently that showed a slide of a Fosters bond being better priced i.e. less risk than that the Australian government bond in February this year.

We all assume that the health system which is a bottomless pit will look after us in our time of need. We are sorry but there are too many examples of a failing health system which takes a disproportionate share of everyone’s dollar. Yes there are some great emotional & success stories which we have commented on before such as road trauma & premature infants. In general there is a gap either in time or money that you have to find.

We only had this week an example with a client needing shoulder surgery. The estimated cost is 40k which Work Cover will pay. Work cover always needs serious convincing in such matters & it is even less likely for a major medical trauma. Hence you may need a solution for that & welcome to call us as we have two separate ideas on that. One of those is at a seminar in Brisbane on June 21st with a Collette Larsen who has an incredible health & income story. Welcome to call on 07 3848 1088 or email for free tickets.

As it is now June then it is time to act & do something on your taxx before June 30. We have made the above comments because you can safely assume that your taxx will be wasted. There is almost always something to be actioned before June 30.

If you find that more than too much of your money goes to Taxx you wouldn’t want the standard deduction the government wants to allow.

At some stage Australia could wake up & read what the new UK government read i.e. ‘sorry but no money left’.

At least A. Robb [an appropriate name] commented in the budget reply after Joe lopped 42B off that ‘we can’t afford it’. That’s a start with an attitude change although Tony the loose cannon could also be very loose with your taxx.



The other chunk of your after taxx income may go to your mortgage. Then of course it time to act as one client has this week.

“Hi John,

Jackie here......Mick and I would be keen to have you offer us advice on how to better structure our loans etc.

Firstly, we want to make sure our loans etc are working to the best of the ability, and secondly, we are not happy with our BOQ service. Our latest home loan is with CBA and we also have a mortgage with Macquarie.

It is difficult for us to get down to see you from Dalby for the hours / days we work. I thought it might be possible to get the ball rolling over email - if you could let me know if this is OK, and what you would need to look at (Mortgage statements, rates etc).

I could either email or mail a package of everything you need for you to review and then hopefully we can get down to see you personally to wrap up.

How does that sound?

Thanks in advance for your assistance,
Jackie”

So if you need to reduce your taxx before June 30 or that mortgage is so big it is stressing you or you want to protect the downside then call on 3848 1088 or email as we have 26 years of happy clients. We have an elegant & simple strategy to achieve your goals.

Assuming all is good means you will end up as you are or maybe ‘the mother of all’.

John McAuliffe