InvestSMART

Ask Noel

I'M 52, having been born in 1959. I recall reading that for my birth date, the pension entitlement age is 67. I'm living as an expat in the Philippines but was born in Australia and lived there continuously till 2008. If I remain out of Australia for the next 15 years, would I be entitled to apply for the age pension?

I'M 52, having been born in 1959. I recall reading that for my birth date, the pension entitlement age is 67. I'm living as an expat in the Philippines but was born in Australia and lived there continuously till 2008. If I remain out of Australia for the next 15 years, would I be entitled to apply for the age pension?

As you were born in 1959 you will not be eligible for the age pension until 67. To qualify you must have resided in Australia for a continuous period of at least 10 years so, on the information provided, it appears you would be eligible when you reach 67. Bear in mind you will be assessed under both an income test and an assets test and the numbers for these will change within the next 15 years.

We are in our 40s and over the past 15 years have focused on paying off the mortgage and now own our home, worth $1 million. We also have $100,000 combined in super. We have young children, so expect major expenses such as school fees and holidays in the next three to four years. We can save $5000 a month and would like to invest it for later use. What are our options?

If you can save $5000 a month you must be on a high income, which makes salary sacrifice to super the perfect strategy. At your age you can contribute $25,000 a year as a concessional contribution and if you are a working couple you can salary sacrifice $25,000 each. Keep in mind that this includes deductible contributions from all sources, which include those made by your employer. As this money comes from pre-tax dollars, there will still be money left from your $50,000-a-month surplus. You could also consider conservative borrowing for investment against the equity in your home but you would need to take advice on this to ensure you stay within your comfort level. Another option is to invest in insurance bonds where the tax rate within the fund is just 30 per cent.

I'm considering paying off $15,000 of my HECS debt and receiving 10 per cent extra from the government. Is this a better investment than a high-interest savings account? I plan to use these savings to buy my first home in a couple of years.

It's difficult because your best option may be to deposit $5000 a year into a home saver's account where you will get a guaranteed 17 per cent after tax. You will need to keep the money in there for four financial years but if you made a deposit now and the final one on July 1, 2014, the effective lack of access time is less than three years.

I'm 15 years old and studying commerce. I'm interested in the stockmarket and have been researching and playing the ASX school sharemarket games. I work at Woolworths and I've saved $5000, which is in a Youth Saver Account. I was wondering if there is any way of investing that money with full control of my assets?

Unfortunately it is extremely difficult for a minor to buy shares or managed funds in their own name. A simple way out may be to ask one of your parents to buy the shares in your name with them as trustee. You could arrange things so that you would have full control provided the money comes from your funds and is kept separate from your parents' other money, the asset may be able to be transferred to you free of capital gains tax when you reach 18.

Advice is general and readers should seek their own professional advice.Contact noel.whittaker@whittaker macnaught.com.au.

Questions to: Ask Noel, Money, GPO Box 2571, Qld, 4000, or see moneymanager.com.au

/ask-an-expert.


Join the Conversation...

There are comments posted so far.

If you'd like to join this conversation, please login or sign up here

Related Articles