2023-24 saw strong investment returns again – but can it continue?
SRS Advice Blog
by Strategic Retirement Solutions
1w ago
Key points – 2023-24 provided another year of strong returns for investors as shares were boosted by falling inflation, central banks pivoting towards rate cuts (although the RBA is lagging) and economic conditions were better than feared. – More central banks moving to cut rates, including the RBA early next year, should provide support for investment returns. – However, balanced growth super fund returns over the year ahead are likely to be more constrained at around 6-7% (compared to 9% over the last year) and more volatile with a high risk of a correction in the months ahead as valuations ..read more
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Will cash remain king?
SRS Advice
by Strategic Retirement Solutions
2M ago
Cash has been one of the best performing defensive assets over the past three years. When compared with global bonds (a riskier asset class), a typical portfolio of term deposits would have returned a cumulative 12.6% in comparison to -8.5% for global bonds over the three years to December 2023. With interest rates expected to stay higher for longer, cautious investors would be right to question whether other asset classes are worth the risk. But are the tides changing? On paper cash still appears to be king; however, these healthy returns are attributed to accelerated inflation and rising int ..read more
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Why it’s time to consider currency hedging your portfolio
SRS Advice
by Strategic Retirement Solutions
2M ago
With the Australian dollar trading below long-term averages and expected to rise as the US dollar peaks, it’s time to think about protecting overseas investments with hedging. The following are the reasons why: Hedging can offset currency movements Rising AUD could crimp returns on overseas assets. The Aussie dollar is below its long-term average against the US dollar, indicating it might be time for investors to consider adding currency hedging to global equities portfolios. Hedging can protect a portfolio against foreign-exchange fluctuations by offsetting currency movement effects on the ..read more
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What is risk appetite?
SRS Advice
by Strategic Retirement Solutions
2M ago
Risk is about tolerating the potential for losses. Understanding your risk appetite allows you to make well informed decisions about your money. For some people, risk means excitement and opportunity. For others, it invokes feelings of fear and discomfort. We all experience a degree of risk in our everyday lives – whether it’s simply walking down the street or having investments in the share market. Everyone has a risk profile that defines their willingness to accept risk. It’s usually shaped by age, lifestyle and goals and is likely to change over time. Risk is about tolerating the potential ..read more
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The First Home Super Saver Scheme (FHSSS): a handy guide for homebuyers
SRS Advice
by Strategic Retirement Solutions
2M ago
The First Home Super Saver Scheme is a valuable initiative to help first time buyers overcome the challenges of entering the property market. Purchasing a home is a significant financial milestone, but the ever increasing property prices make it challenging for first time buyers in Australia to enter the market. To help ease this burden, the Australian government created the FHSSS. The FHSSS is an initiative aimed at helping first time buyers save for their first property purchase. It enables eligible individuals to make voluntary contributions into their super fund, which can later be withdra ..read more
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Seven lasting impacts from the COVID pandemic
SRS Advice
by Strategic Retirement Solutions
2M ago
Key points Seven key lasting impacts from the Coronavirus pandemic are: “bigger” government; tighter labour markets; reduced globalisation and increased geopolitical tensions; higher inflation; worse housing affordability; working from home; and a faster embrace of technology. On balance these make for a more fragmented and volatile world for investment returns. But it’s not all negative.   Introduction It’s four years since the COVID lockdowns started. The pandemic ended when it morphed into the less deadly Omicron variant in late 2021, but just as a sound can reverberate around a room ..read more
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Millions to get more Age Pension starting from 20 March 2024
SRS Advice
by Strategic Retirement Solutions
2M ago
Millions to get more Age Pension starting from 20 March 2024 Government Age Pension payments increased on 20 March, so if you’re one of the millions of eligible Australians, you’ll have a little more to spend. The increases are designed to help address inflation and cost of living increases. Here’s what happened.   Age Pension payments increase in March 2024 due to indexation Here are the maximum Age Pension payment rates that came into effect from 20 March, which are paid fortnightly, along with their respective annual equivalents. Single payments rose by $19.60 per fortnight, while comb ..read more
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Economic and market overview – May 2024
SRS Advice
by Strategic Retirement Solutions
2M ago
Encouragingly the International Monetary Fund (IMF) raised its global growth forecast for 2024, following ‘surprisingly resilient’ economic conditions. IMF officials now expect global GDP growth of 3.2% this year. Despite this positive news, major share markets lost ground in April following five months of unbroken gains. Ongoing geopolitical uncertainty, particularly in the Middle East, was unsettling and prompted some investors to lock in profits from the recent strong rally. Inflation also remains above central bank targets in most key regions, prompting investors to reassess their outlook ..read more
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Are bonds a good investment?
SRS Advice
by Strategic Retirement Solutions
2M ago
Let’s look at why you might consider including bonds in your investment portfolio and how interest rates affect their value.   Key takeaways Bonds can provide a stable source of income and can protect the money you invest. They can generally be considered less risky than growth assets like shares and property in normal market conditions and can help to diversify your investment portfolio. Bond prices and interest rates move in opposite directions. When it comes to investing, bonds can provide a reliable source income, capital appreciation and relatively low volatility. But like all type ..read more
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Australian household wealth
SRS Advice
by Strategic Retirement Solutions
5M ago
Is high Australian household wealth a source of support for consumers? Key points Australia ranked as having one of the lowest rates of disposable income growth per capita amongst OECD countries in mid 2023. An increasing income tax burden and mortgage repayments have weighed on income growth, despite solid wages and salaries. But, household balance sheets in Australia look stronger compared to incomes. Household wealth increased in 2023, as home prices rose. However, growth in household wealth will decline in 2024 as home prices are expected to fall. Household incomes will also be under pres ..read more
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