Territory Stories

The Northern Territory news Tue 6 May 2014



The Northern Territory news Tue 6 May 2014

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NT news


The Northern Territory news; NewspaperNT




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Community newspapers -- Northern Territory -- Darwin; Australian newspapers -- Northern Territory -- Darwin

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News Corp Australia

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Copyright. Made available by the publisher under licence.

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News Corp Australia



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TUESDAY MAY 6 2014 BUSINESS 25 V1 - NTNE01Z01MA AS THE Federal Government continues to soften us up for a tough Federal Budget next week, the balance between good fiscal management and crunching the economy is a very fine line. Its a line that the Reserve Bank of Australia will be watching very carefully. If Treasurer Joe Hockey overdoes the tough love and causes a contraction in the economy, the RBA will have no option to cut official interest rates to cushion the blow. The Government is overplaying its hand in painting a gloomy picture and risks spooking business and consumers. Yes, changes have to made to the welfare system to stop the budget being bled by and ageing population and costly health care. All welfare should be means tested and only go to those in need. But the overall economy is better than it was a year ago, were still one of a handful of nations with a Triple-A credit rating and we havent had a recession in 23 years. Look at it that way, and were the envy of the economic world. Compare interest rates LOG ON NOW moneysaverHQ.com.au How to make your kids rich Here are four easy ways to help your children be financially secure for life SOME of the greatest gifts you can pass on to your children are lifes key financial lessons. Along with reading, respect and healthy eating, good money habits can set your kids up for life and possibly make them rich. So here are four financial lessons to teach your young or not so young kids to pave the way for a wealthy future. 1 HOW TO SET GOALSTeaching kids about the benefits of goal setting and delayed gratification through budgeting and pocket money is a classic but often misused financial lesson. While the general idea of pocket money is they have to make do with the amount theyre allocated each week, parents often muddy the message by showering kids with gifts or extra payments with no rhyme or reason. Young minds are highly impressionable, and theyll quickly realise they dont need to put anything off as they can just rely on their parents to make up any shortfalls. Not the best lesson for later life, youll probably agree. The key here is to remain strict and to get involved. For example, if they simply cant live without the latest computer game, doll house or iPod, offer to keep a bit of their pocket money aside for them each week or buy them a lock-up piggy bank. And when they finally get there, celebrate with them because theyve earned it. Rest assured theyll remember that lesson when that computer game becomes a car or house for their own family down the track. 2 VALUE OF HARD WORKHolding a part-time job, whatever it happens to be, is an essential part of growing up. It teaches children about responsibility, honouring commitments and the value of money. All our kids started working at McDonalds as soon as they were old enough and we reckon that was crucial in developing the work ethic they have today. One of the most memorable lessons for a child whos just started work is to show them your weekly grocery bill and compare each item to their hourly wage. Theyll soon realise the value those dollars actually represent. And dont forget the housework. Setting kids chores at home, whether laundry, cleaning or making their own lunches, is another great way to show that nothing in this life comes for free. The sooner kids learn how to work diligently and effectively, the better off theyll be later on. 3 INVEST FOR THE FUTUREThe magic of compounding is arguably the greatest financial gift you can pass on. Putting a little away, on a regular basis, over an extended period is one of the wonders of wealth creation. With time very much on their side, its never too early to start teaching them about investing. There are so many ways to go about this. Many parents like to start an investment or savings account to pay for their childrens education, so why not bring them on this journey to teach them about investing for the long term? As they get older, start to explain to them how shares work with practical examples. If theyre having a soft drink, or going with you to the bank or supermarket, let them know that they can buy shares in the business that runs the company. Why not suggest they participate in the ASX share market game? They can even compete against you to fuel a bit of family rivalry. Armed with a great financial education around saving, working and investing, your kids will be in the best possible position to succeed on their own when they grow up. 4 RISK VERSUS REWARDThey need to understand that when something is too good to be true, it normally is, because the risks are generally higher. Assessing risks, matching them with the rewards is the key not only to investing but also general life decisions. Passing that on can be life changing. F E D E R A L B U D G E T TREASURER IN BALANCING ACT David & Libby withdrawal requirement from/to my pension fund? Will the ATO accept this? You cannot contribute to a fund in pension mode but if you have a self-managed superannuation fund the fund can have an accumulation component and a pension component. Contributions made to that fund will be credited to the accumulation component, and an actuarial certificate will be required each year to ensure that the profits are split equitably between the two components. Noel Whittaker is the author of Making Money Made Simple and other finance books. His advice is general in nature and readers should seek their own professional advice before making any financial decisions. To ask a question, email: noelwhit@gmail.com. investments or other alternatives for my savings? Your best options will depend on your goals. For example, if you are considering buying a house within five years, you should think about the benefits of a First Home Saver Account. If this is not on the horizon, you could take advice about investing in quality share trusts, but you would need to have at least a five-year time frame in view and be prepared to ride out the normal ups and downs of the share market. IM 70 years old and recently read that contributions can be made to a super pension fund without opening another fund. If this is true, can I reinvest 75 per cent of 5 per cent of my compulsory before becoming eligible to pay tax? There is no gift tax in Australia, so you can gift away as much as you wish. Of course, if you have to cash in assets to find the cash for the gifts, you could be liable for capital gains tax. I AM 23 and earn $52,000 a year. I live at home but Im planning to move into a unit soon. I have $17,000 in savings at 4 per cent interest, a reliable car and no plans for any big holidays or purchases in the near future. Should I be looking at shares, property the vendor has the property on the market. This will enable you to couch an offer that is tailored to the vendors circumstances. For example, if they were having financial problems, you could ask for a hefty discount for a quick sale. If they needed time to buy elsewhere, you could offer a long-term settlement in exchange for a reduced price. IM a self-funded retiree. I do not receive any benefits from Centrelink and I would like to help my family by giving a money gift to them. How much can I gift to a person IS THIS a good time to be borrowing to buy a home to live in? There is an old saying that it is never a bad time to make a good investment. Falling interest rates mean that mortgages are getting cheaper, but take the time to research the market so you will know a bargain when you come across it. Make sure you find out why GEN Y JUSTINE DAVIES THE most recent JB Were Australian Giving Trends report says giving to charities improves with age, both in terms of the size of donation and the proportion of those who give. According to the report, about 35 per cent of Gen Y and Gen X donate money to a cause, at about $200 a person, on average. This rises to about 45 per cent of Boomers donating about $500 each, on average. Both the proportion of and dollar value given by retirees is greater again, so in monetary terms it would seem that retirees are far and away the most generous. Money is only one form of giving, of course. The donation of time and energy can be also be valuable to charities. A Galaxy Research survey of 1004 Gen Ys, commissioned by Optus, found Gen Y donate more than 16 million volunteer hours a month. Interestingly though, the donation of time is more likely to be made to a community group, educational institution or environmental organisation than it is to a traditional charity. Whether a traditional charity or not, the ultimate aim of any of the organisations mentioned above is to provide goods or services to a particular sector. Generally that requires money, volunteers and public awareness. It might be donating time to your local meals-on-wheels service, or putting aside some of your tax refund each year for a cause. Either way, if its a few hours or a few hundred dollars, any resources that you can contribute are likely to be gratefully received. Justine Davies is finance editor and commentator with financial research and ratings firm Canstar. GEN X BRUCE BRAMMALL TO BE honest, I wouldnt have said Gen Xers. So many Xers have kiddliwinks our donation to society is to try to raise them right. Kids leach all our money, most of which does not qualify as a charitable tax deduction. They soak up all our time. Cute and mostly fun, but time and money hoovers. Any spare cash, after the kids have carved out their 17 pounds of flesh, largely gets sunk into our mortgages. Xers getting the gold medal for donations? Thpppt! Not so fast. While Australia topped the donations list in 2012, an earlier survey said those aged 45-54 were the most generous, which includes older Xers. (Look hard enough and you can find a survey to back anything!) Honestly, the wealthiest generations probably top the list thats Boomers and retirees. Xers will get there one day. Being generous can be done with either your money or your time. Between kids and careers, finding either can be tough. Find your cause. Something that tugs your heart. No time? Open your wallet. If your wallet is drained, donate some butt-on-thecouch time. Dont forget that donating to many charities qualifies as a tax deduction. That means, if you make a $100 donation, you pay $66 and the government coughs up $34 (for average earners). And charities are always looking for volunteers. Your time might be more valuable to them and will make you feel better for the activity. Bruce Brammall is the author of Debt Man Walking and principal adviser with Castellan Financial Consulting. BOOMERS MARK BOURIS ACCORDING to LiveTribe research, the most generous group is the 68-plus generation, 54 per cent of whom participate in a charitable activity at least once a month. The Boomers come in second, on 29 per cent. Of course, people who are retired or financially secure with an empty-nest are more able to contribute their time and money. So the fact that the LiveTribe research from 2012 says 15 per cent of Gen Xer and Gen Y said theyd contributed to a charity at least once a month is not a real comparison. You give when you can. I think my generation tends to support charitable activities that give people practical help, or help to help themselves. So we are probably more inclined to give to Salvation Army, St Vincent de Paul, Youth off the Streets and things like that. The research bears this out. It found that Boomers are most inclined to give to general welfare charities whereas the 68 and overs are inclined to cancer/disease/health charities, the Gen Ys contribute to environmental causes and Gen X are into child-related charities. However, there shouldnt be a hierarchy of charitable giving. The best way to give is to select two or three of the charities you believe in and plan to make one substantial donation each year to each of them. In the end, charity is about what someone needs from you, not what you want to give. Mark Bouris is executive chairman of wealth management and advice firm Yellow Brick Road. RETIREES KERRIN FALCONER I AM not sure that any one generation as a whole is any better or worse, than any other in the stakes of being the most generous. It is more of an individual thing. But how do you donate? Let me count the ways. Donating time. It is probably retirees who romp it in is as far as giving in this area. After all, they are the ones who have the time to deliver library books, meals, company and care to those on their own. Sponsoring others usually those from the younger generations, to get on bikes, into water and around the tracks to raise money for very worthwhile causes. Attending functions in support of charities. Many retirees attend movie afternoons and evenings, lunches, fashion parades, quiz nights and black ties affairs for charities of all sorts. Belonging to a service club. Lions and Rotary clubs provide support not only for overseas causes but also for grassroots community concerns. Often these groups receive no government assistance. Investing in companies that are socially responsible. Many publicly listed companies that retirees invest in have set up charitable trusts. Westpac has set up a foundation that will provide 100 scholarships a year. Donating blood. Many fit and healthy retirees donate whole blood, platelets and plasma on a regular basis. How much and whatever is donated is up to you but anything contributed is valuable. Kerrin Falconer is a finance writer with 15 years of financial planning experience. Falling interest rates mean that mortgages are getting cheaper, but take the time to research the market ITS ALWAYS THE RIGHT TIME FOR A GOOD INVESTMENT NOEL WHITTAKER Which generation is the most generous when it comes to giving to charities. How do you donate? YOUR ADVICE Compare home loans LOG ON NOW moneysaverHQ.com.au

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