INSIGHTS WITH EVALESCO
Using a tried and trusted guide to the eight simple steps for financial success Directors Jeff Thurecht and Marshall Brentnall spoke freely about why these strategies are important to always go back to.
What is it about these steps that are important and continue to be relevant?
Financial advisers, accountants and solicitors seem to have a habit of taking otherwise simple strategies and making them complex. Our team take a different approach, and do all that we can to ensure our messaging and advice is delivered in an easily digestible format.
Advice that is understood leads to better engagement, and in time, this translates to a greater likelihood of financial success.
The importance of this approach was highlighted to Jeff and I throughout the Global Financial Crisis, and has been reinforced throughout every subsequent crisis or period of economic instability.
Whilst all clients have different goals and objectives, the majority if not all of these can be achieved with the considered use of eight steps for financial success. Many of these steps are tenets that have been passed down through the generations, and several can even be found in the text by Richard S Clayson, The Richest Man in Babylon.
Step 1: Spending less than you earn
Whether you’re a business or individual if you are consistently spending more than you earn it is unlikely you will find financial success. That’s why all Evalesco advisers, and all of our financial plans, stress the importance of consistently spending less than you earn.
Once you are consistently spending less than you earn, it opens the door to the remaining seven steps for financial success. Some, but not all, of these include owning your own home, managing your borrowings wisely, making the most of superannuation, owning an investment portfolio and building a professionally managed share portfolio. The purpose of this blog is to provide you with a glimpse of these steps and over the coming month we will explore them in more detail and where possible reference some client stories as well.
Given what’s been going on in the world and the volatility and the challenges are these simple steps still holding their own?
This is what Marshall had to say:
“If we go back to when we first started our partnership, Jeff and I took on number of clients that (before they came to us) really hadn’t adhered to a number of these steps. These are investors that didn’t have a firm grasps of their spending patterns, had not prioritised home ownership, borrowings were entered into taxation outcomes in mind and personal anxiety levels were high. It took a considerable effort by all parties, however over a number of years, we supported those clients to make sure that they were adhering to the 8 steps for financial success.”
“Since the onset of COVID-19 we have dramatically increased the frequency that we communicate with our clients and expanded our touchpoints via messaging, newsletters and webinars. In all of these touchpoints we have been reinforcing the messaging we have delivered for twelve years, namely to put money aside for a tough times, consistently pay down your personal debts, own your own home, regularly invest in a professionally managed share portfolio with your money (not with a margin loan). By following these simple steps, and others, our clients have had much less, if any, ‘financial’ anxiety and instead have been able to focus on their own personal health and happiness.”
It may seem boring sticking to these simple strategies but Jeff says “they have stood the test of time and from the GFC our learnings were to stick to the simple things and that’s been fantastic over the last 10-12 years.”
If you’d like to hear the full conversation that Jeff Thurecht had with Marshall Brentnall click here
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We believe the true value of financial advice isn’t found in dollars and cents (although this is important too!) but in the peace of mind a financial plan can provide. It’s knowing where you want to go and how to get there, with a dedicated team behind you every step of the way.
We know the impact of good holistic financial advice can make and we have the life experience, technical capability and quality support team that can make that difference for you. We’ve empowered over 1000 families through the delivery of great financial advice, to be healthy, wealthy and happy.
The amount of super you’ll need when you retire depends on your big costs in retirement and the lifestyle you want. The Associate of Superannuation Funds of Australia (ASFA) estimates for a single $44,224 a year and for couples $62,562 a year is how much you may need. This is only an indicator and our advisers assess everyone’s individual circumstances.
The fees we charge for financial advice is only a fraction of the value we derive for our clients, meaning our clients are always better off after seeing us. Rarely do we encounter a new client invested appropriately for their needs, with adequate risk protection, structuring and estate planning provisions in place. Even small tweaks to a financial plan over a long period of time can result in drastically better outcomes for our clients which eclipses the fees of the financial advice. Additionally, you can opt-out of an ongoing fee arrangement at any time.
In our discovery meeting with you our advisers discuss the initial advice fee and the ongoing fees associated with our services.
After our initial phone call to discuss why you are seeking a financial adviser, we arrange a discovery meeting that outlines what is important to you, your current position, our areas of advice, our approach. We then present a Statement of Advice (SoA) to discuss your goals and our recommendations and go through the steps of how to proceed to the implementation stage. After signing the SoA, we discuss your questions, get you to sign the authority to proceed and complete any application forms before implementing the recommendations detailed in the SoA.
One thing to consider is the interest rate on your home loan in comparison to the rate of return on your super fund. Before making a decision, it’s also important to weigh up your stage in life, particularly your age and your appetite for risk. Whatever strategy you choose you’ll need to regularly review your options if you’re making regular voluntary super contributions or extra mortgage repayments. As bank interest rates move and markets fluctuate, the strategy you choose today may be different from the one that is right for you in the future
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