Reflection | Edgeworth Partners

Risk and How to Manage It

If you keep an ear out on the investment world, you will hear a lot said about risk. But many people do not really understand risk, so this week, as something of an antidote to the politics dominating the airwaves, we thought we would spend some time talking about it.

What’s the Drum on Capital Gains and Residential Property?

Did you know that there is a kind of tax that is great to pay? It’s called a capital gains tax and it’s great for one simple reason: you only pay it when you make a capital gain! A capital gain means you sold an asset for more than you bought it for. That is always better than the alternative, which is selling an asset for less than you paid yourself.

Rentvesting

Australians like to move home. Especially young Australians. According to the 2016 census data, young Australians aged 18-24 moved home at almost three times the rate of older people aged 55-64. But can people move home a lot and still buy a home as well?

Some Assorted Budget Tidbits

In our newsletter last week, we discussed the larger talking points from the Federal Budget. This week, we thought we take a look at some of the smaller changes to superannuation that will be of interest to many of our clients.

Bad News Can Be Good for the Economy

A driver has two routes to head home after work. Somehow, we know that if the driver takes Route A, he will be in a minor bingle in which two cars are damaged. If the driver takes route B, he will get home safe and sound. You are the Australian Treasurer. Which route do you want the driver to take?

Will Increasing Interest Rates ‘Fix’ Inflation?

Unless you are an avowed cyclist, you will probably have noticed what is happening to petrol prices at the moment. They are up. Way up. Prices in most parts of Australia are now over $2 per litre for standard motor vehicle go-go juice.

The Need for Insurance

Our heart has been breaking in recent weeks over the massive floods affecting so much of Queensland and NSW. If you or someone you know has been affected, please know our thoughts are very much with you at this time.

Why do we call it the ‘Reserve Bank?’

One of the most prominent players in the Australian economy is the Reserve Bank of Australia – or the RBA. The RBA is Australia’s Central Bank. This means that it is the banker for the Commonwealth Government and that it is responsible for management of Australia’s currency.

How to Find Yourself Singing in the Rain

Last week we discussed how the Governor of the Reserve Bank Phillip Lowe recently recommended that home borrowers ensure that they have a ‘buffer’ against the time when interest rates inevitably rise. Interest rate buffers are not the only type of buffer in good financial planning. Buffers are used in many areas, but the need for buffers always comes from the same source: understanding that the way things are now is not likely to be the way things are in the future.

How to Think Like an RBA Governor

Last week, the Governor of the Reserve Bank Phillip Lowe gave a speech at the National Press Club. As is the tradition, at the end of his set speech, he was asked questions from the floor. One question stood out among the many.