Educate. Empower. Enable.
Across the board, employees are reporting overwhelming financial pressures regardless of status within an organisation. Increasingly, the standard pay cheque and super contribution aren’t cutting it for those in the workforce. Even the traditional lure of bonus schemes has lost lustre, as growing consensus indicates that clarity on guaranteed income is perceived as more desirable.
As employee expectations increase in line with modern financial pressures, it’s becoming more and more critical for employers to show active interest in the financial wellbeing of their people.
A well-rounded benefits package with long-term investment strategies can be the difference between productivity and active staff disengagement. Additionally, the results stemming from a disgruntled workforce can be disastrous.
Alarming Statistics
Statistics from 2014 indicate that more than 75% of the Australian workforce was disengaged with their role and their employer, costing the economy $79 billion in absenteeism and presenteeism (showing up to work but putting in as little effort as possible).
A Sticky Solution
Learning from this, economists and organisational psychologists agree that putting effort into creating an employee benefits package not only positions an organisation as a responsible corporate citizen, it also delivers the benefits of protecting profits and intellectual property, increased staff retention and attracting desirable talent.
But where does a business start? What do employees even want? And how do you manage it all?
Corporate Services Division – Investing in People
In order for any person to be able to secure the future they desire and deserve, they firstly need access to knowledge, tools and guidance.
This was the driving force behind Financial Decisions establishing its Corporate Services division, and remains the philosophy that guides this successful initiative today.
For your Business
The mandate of our Corporate Services division is to maximise employee engagement, optimise the benefit that individual employees derive and finally, enhance the value you add to your people’s lives.
To achieve this, we will partner with businesses to provide:
- Seminars: To communicate plan specifics, mechanics and opportunities to employees.
- Policy Committees: Working directly with your business to ensure procedural compliance.
- Legislative Updates: Superannuation is constantly evolving and we keep you up-to-date on all the changes, how they affect you and how to take advantage of them.
- Account Management: A dedicated point of contact who knows your business, considers your people and understands the unique needs of your business.
- Employee Contact: Ongoing support for your people to ensure they are getting the most out of their fund.
- Independent Industry Expert: To provide clarity across suppliers and help you evaluate the market and your programme’s place within it without stakeholder bias.
For your Employees
Loyalty is bred from demonstrated value, and we all want the benefits of employment to extend beyond a pay cheque. Employers of choice care about your long-term wellbeing and invest in helping you make informed decisions about wealth creation and management. We want to help make the most of your employment, and start capitalising on what’s on offer.
Corporate Services will assist you with:
- Employee Share Purchase Plans (ESPP): Gaining equity in a company you understand and trust can be a solid step towards achieving your financial goals.
- Life Insurance: Guidance on what plans will address your needs as well as assistance with claims and ongoing management.
- Investment Advice: More than just speculation, we offer guidance on trends and advice on how to develop or maintain your financial health.
- Salary Sacrifice: Super, HECS or car lease – whatever it is, we make it easier to understand and easier to achieve.
- Estate Planning: To assist in ensuring your family will be looked after and strengthen your strategy.
Knowledge is Power
Knowing what to do with super and managing an investment strategy can be a full-time job in itself. In order to maximise the efficiency of the time you spend on your wealth management plan, we aim to educate through targeted mechanisms facilitated by our Corporate Services programmes.
We invest in your future by offering:
- Seminars/Webinars: To communicate changes and advise on principles of wealth management and how to make the most of your superannuation fund.
- Employee Benefits: How to set up, run or reap the rewards of your programme.
- Online Tools: Access to our comprehensive suite of resources as well as reminder emails relevant to your individual fund and regular newsletters to keep you informed.
- Adviser Helpline: If you have questions, our experts will be at your service.
- Adviser Meetings: Sometimes you have a number of questions or inquiries that require deep consideration. We will arrange one-on-one adviser meetings to provide personalised support.
- Financial Plan Preparation: Wealth management requires more than an intelligent approach to superannuation and we can help you build and maintain a comprehensive plan to achieve your goals.
Making it Easy
While the creation, administration, reconciliation and ongoing management of employee benefits programmes can be overwhelmingly complex, it is precisely what our Corporate Services division at Financial Decisions is designed to do.
Talk to Damien Cooper, Margaret Channell or Tim Collins today and start leveraging your employment for optimum long-term benefits.
Super Smart
We all know that the government has a cap on the amount of money you can contribute to your super accounts every year but what many don’t know is how to maximise these contributions in order to optimise long-term wealth creation prospects and reduce tax exposure. That’s why adopting a considered approach that explores multiple tax-effective avenues is an intelligent way to go about managing your super.
Sacrifice and Gain
Sacrificing a portion of your income to super in addition to the contributions made by your employer is a great way to enhance your fund while minimising the amount of tax you have to pay. Under salary sacrifice agreements, contributions are made prior to income tax being applied – plus the tax on those contributions (15%) is significantly less than the marginal tax rate (at least 32.5%). Further, it reduces your assessable income and potentially your tax bill as well.
As an example, if you earn $65,000 a year and sacrifice $5,000 to your super, your assessable income becomes $60,000 and your yearly income tax is reduced by over $1,500.
There are limits to the amount you can sacrifice annually but it is definitely a smart way to save money while saving money.
Become a Power Couple
Spouse contributions are a powerful tool when used effectively. Putting money into super on your spouse’s behalf is classified as a non-concessional (after tax) contribution, and therefore not subject to any further tax.
As a bonus, you might also be able to lower your annual tax bill. If your partner’s income is $10,800 or less per annum and you make contributions to their super account, you are potentially eligible for an 18% tax offset for those contributions.
Once again, there are limits around how much you can contribute and how much of a tax offset you receive but it is certainly an avenue worth exploring, especially considering it is so easy to set up.
A Painless Split with your Partner
Contribution splitting is a murky area that can be confusing, which deters many people from pursuing it. However when you do, there are multiple benefits for both you and your partner.
You are able to split up to 85% of concessional contributions received in a financial year with your spouse. Further, if you are a member of a public sector super scheme, you can transfer 100% of the untaxed splittable contributions made by your employer if that amount is less than the concessional contributions cap for that financial year.
The advantages you can obtain from this practice include:
- Access to the low rate threshold for each member aged 60 or younger
- Providing superannuation to a non-working or low income spouse
- Allocation to insurance premiums for a non-working or low-income spouse
- Obtaining the benefits of super earlier by splitting contributions to the older spouse (note that contributions cannot be split where the older member is over 65 years of age or retired)
- Intelligently navigating around government practices that may adversely affect a super account as a result of changing legislation
How Do I Do All This?
Surprisingly, not everyone finds the ins and outs of super funds and tax law stimulating!
As we enter a new financial year, we can help identify effective methods of increasing your super whilst simultaneously reducing your tax for 2016-2017. Please contact a member of our team on (02) 9997 4647 for a review of your financial plan and sound advice on maximising your wealth creation and management strategies.
Disclaimer: This publication has been compiled by Financial Decisions (AFSL/ACL Number 341678). Past performance is not a reliable indicator of future performance. While every effort has been taken to ensure that the assumptions on which the outlooks given in this publication are based on reasonable data, the outlooks may be based on incorrect assumptions or may not take into account known or unknown risk and uncertainties. Material contained in this publication is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The information and any advice in this publication do not take into account your personal objectives, financial situation or needs. Therefore you should consider its appropriateness having regard to these factors before acting on it. While the information contained in this publication is based on information obtained from sources believed to be reliable, it has not been independently verified. To the maximum extent permitted by law: (a) no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up-to-date or fit for any purpose; and (b) Financial Decisions nor its employees are in any way liable to you (including for negligence) in respect of any reliance upon such information or advice. July 2016
Contact: Financial Decisions PO Box 484 Mona Vale NSW 1660, T 02 9997 4647, F 02 9997 7407