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Services

Professional Investment Services is the financial planning Company of the Professional Investment Holdings Group. The Company operates under an Australian Financial Services licence and is a Principal Member of the FPA. The Company operates through over 1,500 branches Australia wide. It is owned by accountants and financial advisers.

The Management, Directors and Shareholders provide a wealth of experience and knowledge accumulated over many years in the accounting and financial planning areas.

Self Managed Superannuation Funds

Self Managed Superannuation Funds (SMSFs) are a very popular superannuation structure with some 395,000 SMSFs opereating within Australia (at September 2008). The money invested through SMSFs represents approximately 30% of all assets held in the Australian superannuation system.

SMSFs perform the same role as larger funds, by investing contributions and making them available to members on retirement. The main difference is that the members of a SMSF are also the trustees of the fund. They control the investment of their contributions and the payment of their benefits.

As individuals' superannuation assets have grown, many people have sought to gain greater control over the day-to-day management of their superannuation, leading to a rise in popularity of the SMSF.

A SMSF has a number of unique characteristics. Some of these include:

• A SMSF can have no more than four members;
• No member of the fund is an employee of another member of the fund, unless they are related;
• Each member of the fund must be a trustee of the fund, and each trustee must be a member. Where a company is appointed to act as the trustee of a SMSF, each member of the fund must be a director of the trustee company, and each director must be a member;
• No trustee of the fund receives any remuneration for their services as trustee;
• SMSFs are regulated by the Australian Taxation Office (ATO) whereas other types of superannuation funds are regulated by the Australian Prudential Regulatory Authority.

Whilst the trustees of a SMSF must act in accordance with the general laws governing all superannuation funds, a number of concessions apply including the ability of a SMSF to acquire certain assets (particularly listed securities and business real property) directly from members of the fund.

SMSFs offer some very real benefits to members, but at the same time, carry responsibilities and obligations.

A Professional Investment Services authorised representative with SMSF authorisation can assist people interested in taking greater control over their superannuation in determining the suitability of a SMSF for their particular circumstances.

Estate Planning

It's only natural that we prefer not to think about death and, as a result many put off planning for this situation.

However, it is vital to plan how you would like your assets to be divided in the event of your death to ensure they are distributed efficiently and according to your wishes. All sorts of problems can occur if you have not planned your affairs properly.

Planning can also ensure your assets are distributed in a tax effective way and can minimise the effect of capital gains tax. As part of the process you should also check your superannuation funds and life insurance policies to see who you have nominated as your beneficiary and seek to make changes if necessary and possible.

Property and investments which are held as 'joint tenants' cannot be distributed through your Will. Ownership passes automatically to the surviving owner. If owned as 'tenants in common' your share in the property is distributed through your Will.

Managed Funds

Managed funds pool the money of individual investors who share common investment goals. Professional fund managers use the pool money to buy investments, such as shares, property, fixed interest and cash that are consistent with the fund's financial objective.

One the biggest benefits of managed funds is they offer instant diversification of your investment with expert management.

When you invest in a managed fund, you purchase units in that fund.

There are managed funds for virtually every investment objective.

Click here for information about the different types of funds.

Investment Strategies

Figuring out which investments can best help you deliver your comfortable retirement requires an understanding of:

• What your investment options are;
• How different types of investments tend to perform over long periods of time; and
• Your financial goals, so you can pick an investment mix suited to your specific retirement investment objectives and risk tolerance.

Your primary investment choices can be broken into four general asset categories: shares, property, fixed interest/bonds and cash.

Though each may play a role in your long-term strategy, investing directly in shares, property, fixed interest and cash is not always easy for the individual investor.

Creating the ideal investment mix involves identifying your personal objectives and risk tolerance and diversifying your investments accordingly. That is, choosing what's appropriate for you and acquiring the appropriate investments.

Monitoring and modifying your investment mix over a long period of time can also be a daunting and time-consuming task.

Your Professional Investment Services adviser will determine your profile through a confidential client data collection form and advise you of your best options to achieve your goals.

Gearing Structures

Geared investments, or investments made with borrowed money are generally designed to increase the potential for tax deductible expenses such as interest costs.

The goal of this strategy is for the assets purchased with borrowed money to increase and create a profit when sold after repayment of borrowed funds plus expenses.

Normally geared investments are used to buy direct property or Australian listed shares.

The main risk associated with such a strategy is that the asset you purchase will actually fall in value, even to the point where selling the asset doesn't completely satisfy the underlying debt.

This will mean that, although you might receive extra tax deductions over time, you might actually lose capital (and carry over a debt) when you eventually sell the asset.

The potential to make a higher gain by borrowing exists only because of the added risk you take in using borrowed funds in the first place.

Insurance

Life Insurance

With life insurance, the life you're really insuring is everyone else's! Life insurance that pays out upon death is to all intents and purposes death cover. While you won't be around to enjoy any benefit, your family will and that's why it's important to have some kind of cover. As the major breadwinner, who would look after your family when you die? Do you really want to be beholden to someone else to look after your family? What if they need to go on welfare?

Income Protection Insurance

While life cover will look after your family when you die, what happens if you can't work because of illness or an accident and it's going to take months to recover? Or maybe you can never work again and you've got school fees to pay, food to buy and a mortgage hanging over your head.

This is when you need income protection insurance, otherwise known as disability insurance. It's estimated that you will earn something like $4 million dollars over your working life, so it would be fair to say that your income needs protecting a lot more than your home and your car. This is even more so given that at the age of 35 you are ten times more likely to be disabled than die.

Trauma Insurance

If you're diagnosed with a critical illness or crisis, trauma insurance can relieve your financial difficulties. Unlike income protection insurance, which is dependent on your inability to work, trauma cover is paid out on the diagnosis of a defined critical illness regardless of your working status.

Instead of receiving a monthly income stream, you are paid a lump sum that you can spend on whatever you like – medical bills, your mortgage, an overseas trip, even a new car. The insurance company makes no demands on how you spend the money. Trauma insurance is often an adjunct to term life policies.