Frequently Asked Questions

Strategic Wealth Solutions Pty Limited (SWS)

AFSL:  273368

 

What Fees are payable?

We have four types of fees:Once only Plan Fee, which is charged for producing a tailored financial plan (based on time spent and level of complexity).Implementation Fee which covers the time taken to implement the recommendations in your financial plan. This fee is a flat fee based on time spent and is once only.

Ongoing Fees of which we have two types – Proactive Service and Reactive Service.

Proactive Service

Our Proactive Service is where SWS operate as a financial coach. We charge a determined annual percentage of funds under management.

This entitles you to ongoing advice throughout each year, formal reviews, new investment opportunities, investment seminars and our commitment to you that in the event of any changes that relate to your portfolio, (for example legislative, economic, or investment related) we will contact you to discuss and provide solutions/recommendations.

Our overall philosophy is to be proactive in the service we provide and do our best to keep you on track.

Reactive Service

Reactive Service is where we offer you a fee for service option. Under this service level SWS is not proactive in terms of offering new investment opportunities, investment seminars or proactive advice regarding changes in legislation, etc that may impact your strategies. We will only act when a client calls us, when they want service or advice and charge them accordingly, based on time spent.

SWS is essentially a financial confidant for the client.

Entry and Exit Fees

We do not generally recommend investments that charge these fees. However, there may be rare instances that we do and this would be disclosed to you in full detail.SWS normal practice is to utilise wholesale funds that do not charge entry/exit fees.

How long has SWS been in business?

The genesis of SWS commenced in 1986 and SWS obtained a Dealer Licence from ASIC in April 2004.ASIC set conditions on the Licence, such as ongoing training, financial and compliance obligations.

How safe is my money?

All investments are placed in the client's name with individual fund managers and there is no credit risk associated with either the Adviser or the Dealer. All cheques are paid directly to the Fund Manager or Trustee company. No investment cheques are made payable to SWS or the Adviser. Cash is not accepted as all investments are made by cheque only.The safety will depend entirely on the underlying investments and is not guaranteed by SWS or Fund Managers.The adviser represents the client's interests and makes recommendations based on the client's needs.

What is the role of SWS?

We regard our role as being similar to a financial coach. There is an abundance of information circulated in the media about superannuation, investments and taxation. The majority is counter productive to you meeting your lifestyle goals and is simply noise. We act as an information filter and provide advice that is tailored specifically to you. The majority of our time is therefore spent undertaking research and strategy consideration as well as client service where you receive a variety of information such as progress reports, update meetings, new opportunity seminars, phone calls and implementation of strategies.We look at ourselves as being a partner with you and assist you to achieve your lifestyle goals in a proactive manner.

What happens if my adviser dies or leaves?

All investments are in the client's name so there is no adverse affect on investments. We operate as a team and one of the team would provide ongoing advice. If the whole team was hit by the proverbial bus, SWS would appoint a new fully qualified adviser. Under no circumstances would any client be orphaned.

Who controls/monitors the Industry?

There are a number of key industry "watch dogs" or controllers. They are:

The Australian Securities and Investments Commission (ASIC).

• A government body with responsibility to monitor and control standards.
• The Australian Taxation Office (ATO).
• A government body with responsibility to monitor and control standards in the superannuation area.
• The Australian Stock Exchange (ASX).
• An organisation with a responsibility to monitor and control standards for share brokering transactions.
• The Financial Planning Association of Australia (FPA).
• An organisation with responsibility for monitoring and controlling standards of advisers and dealers.
• Australian Prudential Regulation Authority (APRA).
• A government body responsible for superannuation compliance.

Why do I need insurance?

The best financial plans / strategies can turn into financial ruin if they are not protected with the appropriate insurance policies to cover against various contingencies. Insurance provides you with peace of mind that your possessions and your retirement/wealth creation strategies are financially protected during times of unforseen circumstances.

Why do I need a financial Adviser?

When it comes to planning for the future, most people are missing the big picture with their money and ideally to get the optimal level of results for any person whether it be financial, spiritual, health or lifestyle orientated a Financial Coach is always the best option. That is where the need for a qualified Adviser to become a Financial Coach arises. Most people today have very limited time to properly plan and manage their financial affairs and when they do, their limited time often is wasted either trying to trade in different investments over the internet or have their savings stuck in bank term deposits where the value is eaten away by inflation. Then there are other types of people who are so caught up in trying to minimise their tax each year that they miss out on the long term growth opportunities that are available for all investors. They are not able to put their tax position into perspective and balance it with their short, medium and long term goals. If you are serious about reaching your long term lifestyle and financial goals, you need to make sure that you are looking at all of your options and that you are doing what is right for you. A Financial Adviser (Financial Coach) can do this for you, such that you have someone regularly monitoring, looking at things "from the outside in" to ensure that you are doing what is best for you to achieve these important lifestyle and financial goals. A Financial Adviser/Financial Coach provides more than just great investment advice, you also get access to excellent research and technical expertise that is personally related to your situation. You then have the ability to protect your assets, position your money to achieve maximum wealth at your desired risk, receive ongoing service, get advice at every stage of your life and have one less thing to worry about or manage as you are still then focused on other things in your life that are important to you.

What if I want to make my own decisions?

The media is in the business of selling news and stories, not necessarily the truth. Generally, media reports tend to be sensationalized and not a full reflection of the real situation. General advice provided by the media is not tailored to your personal situation and can lead to disastrous results.Making a mistake by not obtaining the best result, can have negative lifetime consequences.

Can I take your advice and not your fund management?

• Our advice is closely tied to the tools we provide to implement that advice. If you choose to take our advice and implement the strategy yourself, the end result could be severely compromised.
• If you join our proactive service package, you will become a member of our 'wealth club' which entitles you to a range of special services such as fund manager seminars, newsletters, etc.
• Your investments will be placed onto our ongoing monitoring system and reviewed regularly to ensure you are still on track to meeting your identified lifestyle goals.

What service does SWS provide?

Depending on individual clients needs, we can provide you with:

• Superannuation strategies and advice
• Tax Planning
• Wealth Accumulation Advice
• Retirement and Redundancy Planning
• Investment Management
• Estate Planning/Family Wealth Strategies
• Risk Management and Insurance
• Managing your cash flow
• Borrowing to buy a home/investment property
• Investing an inheritance

How do we provide advice?

Our first step is to meet with you to clearly define your lifestyle needs and objectives. You will need to provide us with adequate information to allow us to establish your present financial position, ongoing needs and longer term goals.Using a tested process we:

 

• Identify your needs, objectives and tolerance to taking on risk.
• Research and develop tailored strategies from which you can select your preferred option.
• Provide you with written recommendations, outlining the basis of the recommendations and the results of risk exposure.

We will then:

• Work with other professionals, including lawyers and accountants to ensure your strategic solutions are implemented.
• Oversee the implementation of the strategy you have chosen.
• Regularly review and update your progress with you to ensure the strategies remain appropriate and you remain on track to achieve your lifestyle goals.

What does our service cost?

As with our recommendations and risk assessment, all information regarding fees will be provided clearly in writing. Fees will be based on your requirements and the complexity of your situation.We look after a wide range of client occupations but mainly senior executives, university professors, company owners, accountants and lawyers.The majority of our clients are high income earners and/or high net worth individuals who need specialist advice in retirement planning, redundancy planning, wealth creation, wealth protection and other areas such as managing Reasonable Benefit Limits (RBL).

Why choose sws vs a Bank?

Typically there are a range of services that are required by our clients, such as investment advice on their Superannuation and investment portfolios along with mortgage and personal insurance advice when they are buying their first home or an investment property. However all our services are not a necessity in every instance. We will assess your financial situation to best identify what is required.

Strategic Wealth Solutions specialises in helping our clients identify and achieve what is important to them throughout their lifetime. Strategic Wealth Solutions is privately owned and is not controlled by any financial institution/s such as a fund manager, bank or insurance company.

None of these institutions has a vested interest in our business and are not, therefore, in a position to influence us in the provision of advice.

A bank can provide you with advice, but it may take a 'one size fits all' approach and may provide limited investment choice.

What is a trail commission and does SWS receive one?

Trailing commission is a payment made from a Fund Manager's revenue that is paid to a financial planning business. In some rare circumstances we will receive a trailing commission but if this relates to you it will be detailed in your Statement of Advice.

How does debt increase wealth (equity)?

Gearing (using borrowed funds) can be a successful wealth creation strategy for many individuals. Borrowing not only increases your exposure to investment markets but it also provides generous tax incentives. Gearing is not for everyone, as it increases the risk of your investment and so your adviser will help you to decide whether this strategy is right for you.

Why do loans need reviewing?

All borrowings should be reviewed regularly as not only do interest rates change but also the benefits available as loan providers improve their products and services.

Why do my investments need regular reviewing?

Your investment portfolio should be reviewed at least on an annual basis to ensure it continues to match your requirements. Other reasons for review include:

• Changes in Asset Allocation
• Changes in the economic environment
• Changes in legislation
• Changes to your situation (for example, increase in living expenses)

Can I legally reduce my tax?

Yes, there are numerous ways to legally reduce the amount of tax you pay.An SWS Adviser will be able to provide full information.Some examples of ways of reducing tax are:

• Superannuation
• Negative Gearing
• Investments with franking credits or tax deferred status.

Why is Superannuation so important?

Superannuation is a tax effective way of saving for your retirement. The amount you and your employer have contributed over your working life will be crucial in determining the amount of money you will have to live on in retirement. You can benefit from Superannuation through concessional tax rates on income and capital gains, rebates for spouse contributions and deductions for self-employed contributions and salary sacrificing arrangements. Recently the Government has announced co-contribution payments that provide yet another opportunity within Superannuation.

How accessible is my money?

You need to be aware that Federal Government rules are in place to prevent you from accessing your superannuation benefit until you retire from the workforce and have reached a certain age (your 'preservation age'). Your preservation age will vary between 55 and 60 years depending on when you were born (as shown in the table below).

Date of Birth Preservation	Age
Before 1 July 1960	55 years
1 July 1960 to 30 June 1961	56 years
1 July 1961 to 30 June 1962	57 years
1 July 1962 to 30 June 1963	58 years
1 July 1963 to 30 June 1964	59 years
After 30 June 1964	60 years

Apart from retirement, your retirement savings can only be accessed under any of the conditions outlined below:

• You leave gainful employment after age 55 – 60 (please refer to the above table).
• Upon death.
• You become totally and permanently disabled.
• You experience severe financial hardship and meet certain requirements.
• You have compassionate grounds for needing the money, as approved by the Australian Prudential Regulation Authority.
• If you are a temporary resident on a specified class of visa and you permanently depart Australia.

Finally, the law states that your benefit must be withdrawn from the fund when:

• You reach age 65 and are not gainfully employed for at least 240 hours during the previous financial year.
• You reach age 75, unless you receive contributions under an award agreement, or you were aged 75 as at 30 June 2004, and continue to work at least 30 hours per week.

What if Legislation changes - how will I know what to do?

Through our regular newsletters, 'Strategically Speaking' we will keep you informed of general changes in Legislation. However any changes that are specific to your situation will be discussed at your Review or alternatively we will be in contact with you to discuss the opportunity or threat to your strategy.

What is the difference between reactive vs proactive service?

• Level of pro-activity:
• Our clients receive:
  • A highly proactive service that offers new investment opportunities when they arise.
  • Proactive advice regarding changes in legislation that may impact strategies or that provide new opportunities.
    • Invitations to special investment seminars and briefings.
    • Priority access to investment opportunities that have limited access.
    • Pro-active monitoring of Asset Allocation.
• Investment changes

Proactive advice on the need for investment changes.

• Support Network

Assess to high quality professionals such as Solicitors and Accountants.

• Response times

Telephone calls and emails/faxes are responded to within 24 hours.Our first priority is to respond to our proactive clients. We aim to answer all proactive client calls as they are made, however if we are truly unavailable we always respond the same day. We will always respond to reactive client's queries, however we only offer a 72 hour turnaround time.Unlimited access to our advisers. Even when the activity level of our service is very high (e.g. during a time of significant investment market or legislative change) our proactive clients do not pay any additional fees.Quicker access to urgent fund withdrawals.We sit on the same side of the table as our proactive clients. In other words, we are strongly driven to ensure the long term success of their investment portfolio (driven by sound investment and strategic advice) so we share in this success. This is a win/win for our clients and ourselves.

What memberships does SWS have?

SWS is a principal member of the Financial Planning Association of Australia (FPA).

 

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