Financial Newsletter Sunshine Coast

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Trust in Me

Usually you don’t see it coming. With an apologetic smile, he says, “Mate, Margaret and I are updating our wills and we were wondering...”

There it is; you’re being asked to be the executor of someone’s estate.

Such a request is an honour; above anyone else, your friend trusts you to take care of their personal and private affairs in the event of their death. But it can also be a great burden.

The Collins English Dictionary (CED) defines an executor as, “A person appointed by a testator to carry out the wishes expressed in his will”. Simple enough, but what does that really mean?

Firstly, are there any particular instructions for the funeral or disposal of the body? Funerals must be paid for at the time they are arranged. They can be expensive. Is the money available?

When someone passes away, their assets and bank accounts are frozen, however, most banks will release funds from the deceased’s account to cover funeral costs prior to probate being proven.

Probate, according to the CED is, “The act or process of officially proving the authenticity and validity of a will”. Once the Registrar of Probate in the Supreme Court finds the will legally valid, you must consolidate the deceased’s assets, pay their debts and distribute the remainder in accordance with the will’s instructions.

Many turn to the quick and easy DIY will kit, and these, generally, can handle the job. Often, though, they’re poorly written or lacking enough detail to be truly helpful, and when executing final instructions, how do you clarify a contentious point? Does leaving the prized Ford GT to Dean mean brother Dean, or best-mate Dean? What does, take care of my dog mean?

Simply put, you can’t beat a professionally assembled will. Before accepting the task of executor, suggest your friend talk with their financial adviser for assistance with estate planning. Their planner will also recommend a solicitor for drafting the official document once the financials have been sorted through. If your friend doesn’t have a financial adviser, introduce him or her to yours.

Executor duties can drag on for years. Is there a beneficiary proving difficult to locate? Are there children; minors for whom investments must be made, trusts, charities, gifts, properties – all considerations. Should assets be liquidated, should they be held?

Again, the best advice will come from your Futuro adviser.

You will need to keep records of all money received and paid out and make everything, along with a copy of the will, available to any residual beneficiaries – those who inherit the remainder after any special bequests have been disbursed.

Meanwhile, you are entitled to reimbursement of expenses incurred in the execution of your duties and, if authorised by the will, you may apply to the Supreme Court for an executor’s commission.

Your friend’s faith should not be taken lightly, yet it can be a great weight to carry. Take your time, and always seek the advice of professionals trained to help you.

Trust them, as your friend trusts you.

Taking the Risk Out of Retirement Income

Are you close to retirement? Perhaps you’re already there. Either way, you’ve spent years accruing your savings so you might be thinking about reviewing your exposure to investment risk.

While equity and other volatile investment vehicles have their place, retirement is one of those stages of your life when you might prefer a more predictable and secure income.

What options are available?

• Traditional bank term deposits
• Cash management trusts
• Government bonds

Though comparatively secure, they’re not all the same so you should look at each one carefully. In today’s financial climate, interest rates can vary significantly across products, and are usually determined by how much and for how long you plan to invest.

Many income yielding investments provide ATM services for easy access to your money. Others, particularly term deposits, offer special promotions during which your money may attract a higher interest rate and varying conditions.

• Corporate bonds
• Stocks/Shares

These two provide dividends and are generally reliable but the amounts paid are not guaranteed so you may not generate the same income from one dividend period to the next. Unlike term deposits these types of investment also provide a hedge against inflation which will erode the buying power of term deposit investments.

Your Futuro adviser will have up to date information about the types of income yielding investments available and can even provide you with a realistic projection of the amount of income you could reasonably expect to earn from each product.

You’ve worked all your life to reach retirement. You’ve saved and contributed to your super portfolio. Now is your time to relax and enjoy the rewards.

If you’re concerned about your investments and they’re keeping you awake at night, be sure to talk to your Futuro adviser.

Can You Afford Your Bucket List?

Marion was 62 when she first tried skydiving. She was 65 when she rented a red Ferrari and cruised the Great Ocean Road, and at 72 did her first bungy jump.

Many of us have a bucket list; that list of things that simply must be experienced before we kick the bucket. Yet how many of us reach retirement, after working for years, only to find our self-funded pensions aren’t enough to allow us to engage in those dream pursuits?

The reality is, with living expenses constantly increasing, whether you’re an adrenalin-junkie like Marion, or prefer more relaxing activities, you may find you have time to meet your objectives, but lack the available cash.

Rewind 25 years. Marion’s position is no stroke of luck; it required strategic forward planning and the setting of retirement goals. With the help of her adviser, Marion has been able to maximise the returns on her investments to ensure she would be ticking off as many items on her bucket list as possible.

Next week Marion’s turning 75 and to celebrate she’s planning a quiet little shopping expedition with her grand-daughter – along Orchard Road, Singapore.

Speak to your Futuro adviser about your goals and have them work out the actions needed now to make your bucket list come true in retirement.

Disclaimer: This document was prepared by Futuro Financial Services Pty Ltd ABN 30 085 015 (AFSL number 238478) without taking into account any person’s particular objectives, financial situation or needs. It is not guaranteed as accurate or complete and should not be relied upon as such. Futuro Financial Services Pty Ltd does not accept any responsibility for the opinions, comments and analysis contained in this document, all of which are intended to be of a general nature. Accordingly, reliance should not be placed by anyone on this document as the basis for making any investment, financial or other decision. Investors should, before acting on this information, consider the appropriateness of this information having regard to their personal objectives, financial situation or needs. We recommend investors obtain financial advice specific to their situation before many any financial investment or insurance decision.

Disclaimer
All representations and information contained in Futuro in Focus are made in good faith and are believed to be correct at the time of preparation. Articles are of a general nature and they do not purport to be specific investment advice. Individual needs or other considerations have not been taken into account, thus information contained herein should not be relied upon as a substitute for detailed advice. Futuro Financial Services will receive fees or brokerage from the provision of advice or placement of investments. You may, by contacting our Privacy Officer on 07 3018 0400 or by writing to Futuro Financial Services Privacy Officer GPO Box 942 Brisbane QLD 4001, request not to receive further editions of Futuro in Focus.