Christmas is coming – are you prepared?
The festive season is almost upon us and many Kiwi’s will be travelling to see loved ones over the christmas – new year break.
There are simple things to remember and we should always take every opportunity to make sure that our houses are left secure, the mail is going to be collected and that we don’t leave valuables for all to see in our vehicles. Vehicles with GPS units or even the holder sitting on the dash or windscreen are becoming prime targets.
Why not quickly make sure that the items you are taking on holiday are insured, that the home alarm is working and that you have pictures of your valuables safely stored away just incase you are in the unfortunate posiotion of making a claim. Nothing beats showing the insurer a video of your contents in the case of a large burglary.
Thorners are established award winning insurance brokers servicing clients New Zealand wide so contact us if you need to review your current policies. We look forward to hearing from you.
Click here to email Thorners or Call Us on (04) 528 8088
Australian super transfer update November 2009
Legislation allowing New Zealanders returning home from Australia to bring their retirement savings with them will be introduced to Parliament in about two weeks, Finance Minister Bill English says.
Providing the necessary law changes are made in Australia, it is envisaged the new arrangements will take effect in the second half of next year.
“This is an important step forward for our wider Single Economic Market programme with Australia, particularly in helping the free movement of labour between the two countries,” Mr English says.
“In particular, it will allow New Zealanders and Australians to consolidate their financial affairs in the country in which they live.”
Currently, Kiwis who work in Australia must contribute to an Australian complying superannuation fund. However, the savings are locked into the Australian scheme until the saver reaches retirement age.
Mr English signed an agreement with Australian Treasurer Wayne Swan in July, which paved the way for the new super portability scheme.
It will allow retirement savings from certain Australian superannuation funds to be transferred into New Zealand KiwSaver funds – and vice versa. New Zealanders bringing their savings home must put them into a KiwiSaver fund.
Australia’s Tax Office has estimated that it holds about A$13 billion (NZ$16.6 billion) in “lost accounts” in the Australian superannuation system.
“We expect that much of this money could belong to New Zealanders who have returned home and these new rules will allow these funds to be brought back to New Zealand,” Mr English says.
Participation in the super portability scheme will be voluntary.
The Government will include the changes in the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver and Remedial Matters) Bill, expected to be introduced to Parliament in mid November. Key facts about the Super portability changes
The transfer of retirement savings between the two countries will be exempt from entry and exit taxes. Under current tax laws, transferring savings from Australia to New Zealand may be regarded as a taxable dividend. The proposed legislation will ensure this does not happen.
KiwiSaver members moving from New Zealand to Australia will be able to retain any member tax credits if they transfer to an Australian scheme.
KiwiSaver members will not be able to withdraw money transferred from Australia to help them buy their first home, but they can use the interest earned on those savings for this purpose.
Retirement savings transferred from Australia into a New Zealand KiwiSaver scheme can be withdrawn when members reach the age of 60 as long as they have retired – as set out under Australian scheme rules. KiwiSaver savings transferred to Australian schemes can be withdrawn when members reach 65 – as per New Zealand KiwiSaver rules.
Contact Thorners if you have questions or require advice on this exciting financial development – we service clients NZ wide.
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Rising medical insurance payouts vs premiums is unsustainable
The health insurance industry is warning the growth in the rate of its claim costs compared to premiums is unsustainable.
Publishing the industry’s quarterly statistics today, the Health Funds Association identified rising health costs as its key challenge.
Executive director Roger Styles said claim costs had grown at double the rate of premiums during the past two years, which was not sustainable.
Premium income for the year to the end of September of $859 million, was up 5 percent or $41m on a year earlier. Claims paid were up 9.9 percent or $67m to $743m.
The two main reasons behind recent cost pressures were that more people were claiming on their health insurance, and the average value of each claim was rising, Mr Styles said.
In the past year additional services became available, such as private radiotherapy in Auckland, which was not previously an option for people with health insurance.
Cost-shifting was continuing from the public sector, with a rise in the number of claims for surgery knocked back by ACC, he said.
Also from this month, ACC would require co-payments from patients for physiotherapy, which would have an impact on insurers who covered top-ups for ACC in their policies.
Contact Thorners if you require any Health Insurance cover as they have access to several providers and understand the market.
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Cautionary advice on under-insurance – SME’s and Trustees
- Directors, officers, trustees and others could be fined for not arranging and maintaining adequate insurance cover;
- The levels of under-insurance in New Zealand in both the domestic and commercial sectors are alarmingly high;
- Being under insured is nearly as bad as being uninsured;
- Critical failures include not insuring your business and its assets for the correct replacement value and failing to anticipate how long it will take to get your business back up and running;
- Be realistic about potential recovery costs so that you don’t end up paying the cost of being under-insured;
- Allow for incidental costs such as architect’s or engineers fees. Also include an allowance for the cost of demolishing the remains of damaged buildings or plant and clearing the site of debris: the expense involved in clearing up can exceed demolition costs;
- There is anecdotal evidence of an increase in the incidence of fraud and theft. Liability is also a critical area to regularly review;
- Few businesses have internet liability cover – do you know what your employees are emailing?
Think ahead, not short term.
Thorners have vast experience in all insurance matters and provide advice New Zealand – contact us today to discuss your situation.
Thorners October 2009 Newsletter
Mortgage interest Rates:
Interest rates continue to fluctuate and the gap is widening between the short term fixed and floating rates and the longer term fixed rates. Overseas pressure remains on long term funding and whilst short term rates are expected to remain stable over the next few months, predictions are that the floating rate could be back at 8% within 18 months.
It is also timely to remind you that it’s better to have consumer debt e.g. credit card balances & HP’s transferred to your home loan to make considerable interest savings.
Funding for rental properties and over 80% borrowing is tightening and you are encouraged to approach me to discuss any home lending you or your family may be considering.
KiwiSaver:
Have you and your family got your slice of the KiwiSaver cake yet? Membership continues to grow rapidly with total membership now close to 1.2 million people. The demographics are interesting with 17% of members under 18 years of age and 18% aged 55 plus.
KiwiSaver is a tremendous opportunity for every New Zealander whether you are a child or under the age of 65, even if already retired or not working.
If you or your family members are not a member or are in an IRD default scheme we should discuss how KiwiSaver could work for you. The benefits including the $1,000 kick start and Government contribution matching to $1,042 p.a. are hard to beat.
Life Insurance Premiums:
Everybody dislikes paying premiums and I am constantly told that clients are over insured but the widow or widower always says the cover could have been higher.
Options are now available to make premiums affordable over the longer term and are known as level premiums. There are considerable long term premium savings to be made utilising level premiums and I should also note that the premium is guaranteed for the term of the contract so will not be subject to any changes following the introduction of new Life Industry tax changes being implemented from July 2010.
Why would you not transfer to this? This is the question I am asking everybody. Let me provide you with some level life premium options to show you the premium savings that can be made over the life of the policy.
Competitions:
Sovereign have a great offer to clients where they can enter to win an $8,000 holiday plus $2,000 spending money. Just visit www.sovereign.co.nz and follow the home page link.
I am available to discuss your insurance and investment needs in what is a difficult time for many of us at the moment so please feel free to contact me if you have any questions. My personal email is denis@thorner.co.nz or ph 04 528 8088.
I look forward to hearing from you soon.
Kind regards
Denis
Looking for an investment that has an AA credit rating?
At Thorners we have access to a myriad of investment options and we are always guided by the Standard & Poors rating list.
Non bank deposit takers have been in the limelight over recent years as many have got into financial difficulty and only two remain with an AA S&P credit rating which is the equivalent rating held by the the big Trading Banks.
If you are looking to invest wisely, contact us to discuss your options.
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Click here to email Thorners or Call Us on (04) 528 8088
