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  • Investments

Types of Investments

Understanding the impact of taxation on your wealth is a powerful tool in the financial planning process. Ensuring your investments are structured in the most effective way to minimise your taxes whilst maximising your investment potential is our focus.
There are many options including various asset allocation strategies available for investors. We tailor the investment advice to suit you and gear it to achieve your dreams

Tax Effective Investments

Nobody likes to pay tax. You may be able to reduce tax by utilising the right type of investment.

Some examples of tax effective investments are:
  • Superannuation & Pensions
  • Investment Gearing (Property, Shares and Managed Funds)
  • Borrowing and investing into Capital Protected Investments
  • Investment Bonds
Strategies
  • Salary Sacrificing
  • Transition to Retirement (TTR)
  • Debt Recycling

You may be able to claim a tax deduction and increase future deductibility while acquiring an asset at the same time.
Introduce a long-term tax effective strategy that is beneficial and financially rewarding.
Each and every person has a different financial structure, building a future income stream is vital in today’s ageing population – who knows what complications will arise in the future for Australian retirees.
Provide for your future and that of your children by implementing a strategy sooner rather than later.

Exchange Traded Funds (ETFs)
  • Overview: Investment funds traded on ASX, typically passive (tracking indices like ASX200) or active (aiming to outperform market).
  • Operation: Value tracks index; incurs management and brokerage fees.
  • Benefits: Generally lower fees than traditional managed funds.
  • Risks: Brokerage fees on trades.
  • Unlisted index funds may be cheaper for regular small investments.
Manged Funds
  • Overview: Pooled investment scheme where funds are managed by a professional to invest in diversified assets (shares, property, fixed interest) or specific sectors.
  • Operation: Fund manager buys/sells assets; returns and taxes are apportioned to investors based on pooled performance. Income/ distributions paid periodically; value fluctuates with underlying assets.
  • Benefits:
  • Access to diverse assets with small investment.
  • Option for regular contributions.
  • Simplified tax reporting.
  • Risks:
  • Higher fees (varies; ETFs often lower).
  • Limited liquidity.
  • Reliance on manager’s expertise; no direct control.
Direct Shares
  • Overview: Equity in ASX-listed companies, offering dividends, voting rights, and potential capital growth.
  • Operation: Shares bought/sold daily; prices fluctuate based on company performance or market sentiment.
  • Benefits:
  • Potential for capital gains and dividend income
  • Lower tax on long-term gains.
  • Historically outperform other assets long-term.
  • Risks:
  • Share prices can drop significantly, even to zero.
  • Last in line for repayment if company fails.
  • Last in line for repayment if company fails.
Fixed Interest Investments
  • Overview: Investments like government bonds offering fixed income (coupon rate) and set term.
  • Benefits:
  • Low risk, regular income.
  • Enhances diversification, preserves capital, potential tax exemptions.
  • Risks:
  • Not specified, but typically include interest rate and credit risks.
Investment Bonds
  • Overview: Life insurance products with savings component, similar to managed funds.
  • Operation: Earnings taxed at company rate; tax-free after 10 years if no withdrawals.
  • Benefits: Tax-effective for high earners or minors’ savings.
  • Risks: Not specified, but may include limited liquidity and reliance on provider stability.
Separately Managed Accounts

A Separately Managed Account (SMA) is a customized share portfolio where the shares are owned by individual investors. Your investment in a SMA is allocated across one or more existing investment models. These investment models have been provided by investment specialists and vary in focus in much the same way that managed funds vary in their risk and return objectives.

Direct Property

Most Australians have some property investment – typically their own home or a house or unit which they have bought. If the property is the principle home, then the hope is that the property will rise in value over time (capital growth). For investment properties investors get the benefits of both income (rent) and hopefully capital growth.
Direct property has historically provided investors with attractive returns and low volatility when compared with other investment classes.

A-REITs (Listed Property)

An Australian Real Estate Investment Trust (A-REIT) is a unitised portfolio of property assets, listed on a stock exchange, usually the Australian Stock Exchange (ASX). A-REITs (Australian real estate investment trusts) give investors access to property assets.

A-REITs (Listed Property)

Actively Managed Funds

  • Overview: Fund managers actively trade securities to outperform the market.
  • Cost: Higher fees due to manager expertise.
  • Suitability: Ideal for investors targeting specific market sectors or seeking greater control.
  • Risk: Higher fees may offset potential profits.

Actively Managed Funds

  • Overview: Tracks an index (e.g., All Ordinaries, S&P200) to replicate its performance.
  • Cost: Lower fees, no payment for active management.
  • Options: Limited direct index fund choices in Australia; some ETFs function as index funds and trade on ASX.
  • Suitability: Cost-effective for broad market exposure.

Portfolio Management

  • Active: Frequent monitoring and rebalancing, often using model portfolios without paperwork.
  • Passive: Annual reviews with individual recommendations requiring your approval.
  • Advice: Consult your adviser to determine the best approach for your needs.