DelphiNews September 2014

I’m pleased to enclose the latest edition of DelphiNews.

Market Update

The update below notes that global growth remains resilient in the face of heightened geopolitical tensions in the Ukraine and the Middle East. In the US, an upwards revision in its Q2 GDP has reinforced its continued trend of recovery. The Chinese economy proved somewhat sluggish following a slowdown in manufacturing growth and a weakening property sector.

The Eurozone remains weak, largely impacted by economic sanctions resulting from geopolitical tensions. In particular, weak manufacturing data, falling confidence and low inflation have raised expectations for further stimulus in the region. France however, showed signs of improvement.

In Asia, the Japanese economy emitted mixed signals. It continued its slow move forward but growth data for Q2 showed its biggest slump since the economy was impacted by natural disasters in 2011.

Back home, there has been an improvement in consumer and business confidence. In its September meeting, the RBA has once again left the cash rate unchanged at 2.5%, with interest rates anticipated to remain at this level well into 2015.

Economic Update

In the Economic Update, Brian Parker, Head of Portfolio Specialists Group at MLC, reviews events in Australian and Overseas markets during July. Brian notes that the Australian market had a positive month, but it didn't fare as well as global markets. And that as long as the non-mining economy continues to improve, the Reserve Bank of Australian seems likely to keep interest rates unchanged.

Adviser Education Standards

MLC will increase education and qualification standards for financial planners to continue to build trust and professionalism across the industry.

NAB Wealth Group Executive and MLC CEO, Andrew Hagger said MLC strongly supported moves across the industry to lift education standards and boost transparency.

“We have recently set new education standards for our financial planners to further build the professionalism of the industry and ensure our clients continue to receive quality advice,” he said.

“With an ageing population that is living longer and facing a significant shortfall in retirement savings, the provision of affordable and trusted financial advice to help consumers secure their future is more important than ever.

“We are committed to making cost-effective financial advice accessible to all Australians.”

The new MLC education standards include:

New financial planners recruited will be required to hold a relevant degree qualification and an Advanced Diploma in Financial Planning, or be working towards one to be completed within three years;

All senior planners are required to hold a Certified Financial Planner designation from the FPA or if working towards one, complete it within three years of commencement;

Existing financial planners will be required to obtain the Certified Financial Planner designation by 2017, or a Masters designation and Certified Financial Planner designation by 2019; and

All financial planners will continue to hold membership for a recognised professional association.

Mr Hagger said MLC also supports an enhanced national register of financial advisers, and consumers having open access to information about the ownership and independence of their financial adviser and licensee.

Delphi's Director Vince Dore has met the new standards and in addition is a Senior Fellow of the Finsia, the leading organisation for Australasia’s financial services industry. Please contact us if you have any concerns or questions regarding the new standards.

Changes to the Deeming of Account Based Pension

Legislation has passed which means that from 1 January 2015 the assessment of income from some account based pensions for social security purposes will change. For some people, there will be no change to their assessment. For others, the changes may impact the amount of benefits received now, or in the future. We examine in the article below the change in more detail to help you understand whether or not you may be impacted.

If you or a family member would like discuss any of the issues raised above or if you wish to review your current investment strategy please contact us.

Regards

Vince Dore CFP
Director

Vince Dore and Delphi Financial Management Pty. Ltd are Authorised Representatives of GWM Adviser Services Limited ABN 96 002 071 749, trading as Garvan Financial Planning/MLC Financial Planning an Australian Financial Services Licensee, Registered office at 105 –153 Miller St North Sydney NSW 2060 and a member of the National Australia group of companies.

This advice may not be suitable to you because it contains general advice that has not been tailored to your personal circumstances. Please seek personal financial and tax and/or legal advice prior to acting on this information. The material contained in this newsletter is based on information received in good faith from sources within the market, and on our understanding of legislation and Government press releases at the date of publication, which are believed to be reliable and accurate. Opinions constitute our judgement at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this email.

Level 7, 60 Carrington Street, Sydney, NSW 2000
1300 167 826

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DelphiNews September 2014

Highlights