| Strategy ID |
Section |
Strategy |
Description |
| 84 |
Wealth creation |
Insurance bond |
An insurance bond will generally be optimal under 1 of the following circumstances: |
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- Client/s pay tax at a higher marginal rate than the corporate tax rate.
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- The product is used to meet a specific goal (refer to goals).
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| 85 |
Wealth creation |
Contribute to an existing Insurance bond |
Recommendation will be optimal if this is the best allocation of resources taking into consideration other alternative strategies and competing objectives. The 125% rule is considered in determing the optimal amount. |
| 86 |
Wealth creation |
Gearing within an Insurance bond |
Recommendation will be optimal if the facility offers gearing and the risk profile lending constraints are meet (see advice group assumptions). |
| 87 |
Wealth creation |
Invest a lump sum |
Investing outside of a platform will generally be optimal under 1 of the following scenarios: |
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- There is no superannuation or partner accounts to link.
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- The required portfolio is direct, and access to wholesale managed funds and/or model portfolios is not required.
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| 88 |
Wealth creation |
Margin lending (instalment) |
Recommendation will be optimal if this is the best allocation of resources taking into consideration other alternative strategies and competing objectives. |
| 89 |
Wealth creation |
Gearing (instalment) |
Recommendation will be optimal if this is the best allocation of resources taking into consideration other alternative strategies and competing objectives. A client must have a non-margin lending gearing vehicle (e.g. split loan) for this strategy to occur. |
| 90 |
Wealth creation |
Education Bond |
This strategy will occur due to one of the following reasons: |
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- It meets a specific objective such as funding a child’s education and/or providing for dependents in the future.
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- The bond is tax effective after taking into consideration the clients tax rates and deductibility of education costs.
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- Client has indicated that child is likely to go to university.
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| 91 |
Wealth creation |
Child Savings Plan |
This is just an insurance bond with a specific purpose of saving for a child. The same logic as an insurance bond applies. |
| 92 |
Wealth creation |
Gearing (lump sum) |
Recommendation will be optimal if this is the best allocation of resources taking into consideration other alternative strategies and competing objectives. Lending capacity will be determined by servicability and risk profile constraints. |
| 93 |
Wealth creation |
Withdraw Investment from a platform |
This recommendation will typically occur for one of the following reasons: |
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- Monies are required to meet competing objectives such as debt reduction.
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- Fund are required to meet lifestyle requirements.
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- Monies would be best invested in a different tax environment such as superannuation.
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| 94 |
Wealth creation |
Regular Savings Plan |
Regular savings occurs under the following conditions: |
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- We have an upcoming objective that required cashflow and we don’t have the adequate time to invest in growth assets (see advice group settings).
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- We are saving for a house deposit. It may be optimal to save 20% to eliminate Lenders Mortgage Insurance.
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- We must save to meet an emergency fund requirement.
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| 95 |
Wealth creation |
Income Splitting |
This recommendation occurs when we transfer asset ownership between client and partner. The recommendation will generally be optimal under 1 of the following conditions: Optimality is tax driven. Key considerations will be CGT upon transfer of ownership, and ongoing tax impact upon transfer of ownership. |
| 96 |
Wealth creation |
Margin lending (lump sum) |
Recommendation will be optimal if this is the best allocation of resources taking into consideration other alternative strategies and competing objectives. Lending capacity will be determined by servicability and risk profile constraints. |
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