WEBVTT - Finance with Blake Wendt | June 4th, 2025

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<v Speaker 1>Now on afternoons.

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<v Speaker 2>All things finance with Blake were from Pretzel Wealth. Organize

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<v Speaker 2>your free consultation at Pretzelwealth dot com dot au twenty.

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<v Speaker 1>Two to two.

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<v Speaker 2>Yes, money, money, money, indeed, let's talk about our money

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<v Speaker 2>with Blake went of course from Pretzel Wealth. You can

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<v Speaker 2>answer your questions on home loans, superannuation, investments, other general

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<v Speaker 2>financial advices you might need a bit of a hand on.

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<v Speaker 1>Already had a couple of emails and texts come.

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<v Speaker 2>Through, so if you've got a question calls always do

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<v Speaker 2>take priority one three one eight seven three. Take advantage

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<v Speaker 2>of the free advice Blake. Good afternoon.

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<v Speaker 1>Look at a Michael.

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<v Speaker 2>Now we've just had the inflation and not inflation, we've

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<v Speaker 2>had the GDP numbers come out.

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<v Speaker 1>Really it's it's looking pretty weak. Yeah, lower than expected.

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<v Speaker 3>So quarter on quarter growth was sitting at point two

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<v Speaker 3>percent where the market was expecting point four. Year on

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<v Speaker 3>year one point three percent was the outcome, whereas the

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<v Speaker 3>market was expecting one and a half percent, so lower

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<v Speaker 3>than expected. The market's performed quite well, the stock market

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<v Speaker 3>because what that means in rate just rate cuts, which

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<v Speaker 3>is great for businesses and economic activity. So well, that

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<v Speaker 3>number will be welcomed by those with a home loan,

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<v Speaker 3>less welcome with those with cash in the bank.

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<v Speaker 2>Okay, so we're barely growing. If it weren't for population increases,

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<v Speaker 2>we'd be going backwards. We are going backwards per person.

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<v Speaker 2>But you also made the point to be during the

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<v Speaker 2>ad break that there was some number in all of

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<v Speaker 2>this sowing that government spending is a percentage of the

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<v Speaker 2>economies the lower since twenty seventeen.

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<v Speaker 1>Is that right, That's right.

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<v Speaker 3>It's government spending pulled back, which obviously has an impact

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<v Speaker 3>on economic growth. So their spending level has reduced this

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<v Speaker 3>last quarter. So it's interesting to see and so that

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<v Speaker 3>does play into economic activity.

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<v Speaker 2>Well, that fact seems to uncountered all of the rhetoric,

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<v Speaker 2>the numbers I've seen for well for at least the

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<v Speaker 2>last six months.

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<v Speaker 3>Well, yeah, certainly, and that's what sort of the shocking

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<v Speaker 3>sort of message out of it all that what's happened

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<v Speaker 3>to spaning. So I haven't dived into that and see

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<v Speaker 3>where what's benefit to there, but just interesting to see

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<v Speaker 3>that government spending is down. That can have an impact

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<v Speaker 3>on GDP figures if they're not spending or maybe people

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<v Speaker 3>are out of work. Okay, what is that, what's the

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<v Speaker 3>flow on effect to all that? And so Yeah, interesting

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<v Speaker 3>to see that the market was expecting higher figures come

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<v Speaker 3>in lower, expect more rate cuts to come.

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<v Speaker 2>Okay, fine, Now if people have the question of course

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<v Speaker 2>one three, one eight seven three, we are approaching the

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<v Speaker 2>beginning of the new financial year, or if you want

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<v Speaker 2>to look at the other way, we're coming to the

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<v Speaker 2>end of this one mirror accounts talk to me about these.

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<v Speaker 3>Yes, So often often we have clients who first priority,

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<v Speaker 3>of course, is to build Super. Get money into SUPER.

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<v Speaker 3>It's great, you get to retirement, it's tax free. So

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<v Speaker 3>that's sort of the first priority that we want to do.

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<v Speaker 3>But often we're seeing people who have cash they want

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<v Speaker 3>to allocate it into Super, but for whatever reason, they

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<v Speaker 3>can't get it in. Maybe they're over seventy five years

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<v Speaker 3>of age. You cut it out from adding moneys into Super.

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<v Speaker 3>Maybe you've already maximized your contributions into SUPER and there's

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<v Speaker 3>funds flying around. You could have received an inheritance, you

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<v Speaker 3>may have sold a property. There's cash that needs to

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<v Speaker 3>be allocated somewhere. Now, the last couple of years has

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<v Speaker 3>been great. We've had interest rates at higher levels and

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<v Speaker 3>so your cash is generating enough of an income for

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<v Speaker 3>you to say, well, I'll keep it out of the

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<v Speaker 3>stock market, or I won't invest the funds, I'll just

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<v Speaker 3>get my cash. Now that's changing. There's now concern that

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<v Speaker 3>interest rates are coming down, cash is not producing as much,

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<v Speaker 3>and so we have to do something else with the money.

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<v Speaker 3>Hence a mirror account. Now, a mirror account is simply

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<v Speaker 3>personal investments that mirror your superannuation. So you could have

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<v Speaker 3>your SUPER fund invested in ETFs, BHP shares, common Wealth Bank,

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<v Speaker 3>whatever you want. Inside of Super. We can do the

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<v Speaker 3>same thing outside of Super. Different tax arrangement. There was

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<v Speaker 3>different tax arrangement, yeah, personally taxed. Now the mirror account

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<v Speaker 3>can provide a vehicle for you to invest the money

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<v Speaker 3>is get similar returns to what you're getting in Super,

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<v Speaker 3>and then once Super opens up again, maybe you allocate

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<v Speaker 3>those funds back in. So it's a way to try

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<v Speaker 3>to generate a better return than just simply holding moneys

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<v Speaker 3>in the bank or in cash. And what we want

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<v Speaker 3>to do is make sure that you know, if we

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<v Speaker 3>are impacted by further rate cards. You know, we're currently

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<v Speaker 3>getting about four percent on cash at the moment. If

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<v Speaker 3>that goes down to three or two and a half.

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<v Speaker 3>Unlikely in the short term, but may end up being

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<v Speaker 3>the case. Well, at least we're getting that money working

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<v Speaker 3>and we're getting a higher rate of return for our funds.

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<v Speaker 3>So mirror accounts are great. I'd encourage everyone. If you've

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<v Speaker 3>got cash floating around and you want to allocate that,

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<v Speaker 3>speak to your financial advisor. Remember you are taking on

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<v Speaker 3>risk when you are investing, and so just be mindful

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<v Speaker 3>of what you're getting yourself into before taking that plunge.

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<v Speaker 2>Okay, let's get to questions. That's what this is all about.

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<v Speaker 2>Of course, it's about you. And if you've got a

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<v Speaker 2>question one three one eight seven three a grame road.

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<v Speaker 2>Earlier on the email, he says, I'm fifty two, may

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<v Speaker 2>have in excess to three million by retirement. This obviously

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<v Speaker 2>super if this new tax on super fund's over three

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<v Speaker 2>million comes in. If I have, say three point three million,

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<v Speaker 2>is a balance? Is the text calculated on the full

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<v Speaker 2>return on three point three million or the return on

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<v Speaker 2>the three hundred thousand above the threshold.

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<v Speaker 3>Yeah, so it's it's a percentage. So there's a formula

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<v Speaker 3>that gets applied and they work out the percentage of

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<v Speaker 3>growth in excess of three million based on your account balance,

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<v Speaker 3>so good example, in Graham's case, he starts with three

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<v Speaker 3>point three, has a good year, ends up with three

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<v Speaker 3>and a half million, so two hundred thousand gain. Irrespective

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<v Speaker 3>of selling the asset or not, there is tax on

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<v Speaker 3>that gain. On a two hundred thousand dollars gain, in

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<v Speaker 3>Graham's case, there would be tax of about four three

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<v Speaker 3>hundred dollars, which if you look at that as a

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<v Speaker 3>percentage of the gain, it's a two hundred thousand works

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<v Speaker 3>out to be about two point one percent, So it's

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<v Speaker 3>not it's not a straight fifteen percent. It's a proportional

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<v Speaker 3>tax that applies, and so it's worthwhile keeping that in

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<v Speaker 3>mind because you know, there's a lot of people out

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<v Speaker 3>there making irrational decisions right now, selling properties, looking to

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<v Speaker 3>liquidate share portfolios, trying to get away from having as

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<v Speaker 3>much money in SUPO, and you know, my advice at

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<v Speaker 3>the moment is just to keep a level head, work

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<v Speaker 3>out what the implication looks like for yourself, and just

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<v Speaker 3>remember that it may not be as bad as I

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<v Speaker 3>originally thought. It's still a new tax, so it's not welcomed,

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<v Speaker 3>but it's certainly not as bad as what people may

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<v Speaker 3>believe it is.

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<v Speaker 2>I mean, as we discussed, and we've discussed this now

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<v Speaker 2>even before the election, you were raising this whole issue

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<v Speaker 2>with me. We were one of the first in radio

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<v Speaker 2>to be looking at this. The advice I think from

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<v Speaker 2>you was Okay, the principle here stinks, but in practice

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<v Speaker 2>many people may not be better off trying to dodge it. Yes,

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<v Speaker 2>because the tax arrangements outside correct me if I'm wrong,

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<v Speaker 2>but ure saying the tax arrangement outside of super could

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<v Speaker 2>be more punitive than if you just cop it whilst

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<v Speaker 2>remaining within Super.

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<v Speaker 3>Exactly a right. So you take that money out of SURPA,

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<v Speaker 3>you're investing in what we just spoke about, a mirror

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<v Speaker 3>account as an example, You're then subject to a personal

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<v Speaker 3>tax being applied. So you know, maybe it's not the

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<v Speaker 3>best move to be shifting money's outside of Super. Maybe

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<v Speaker 3>it's okay to accept the tax that's going to be

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<v Speaker 3>on there. Again, it's not welcomed, but maybe it's better

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<v Speaker 3>than investing personally.

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<v Speaker 1>Okay, Dan's got a question.

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<v Speaker 4>Hi, Dan, just on a mirrored accounts you it's walking

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<v Speaker 4>to about is it possible to have a strategy like

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<v Speaker 4>that with a linked offset, So you're putting all your

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<v Speaker 4>money in, for example, to share the investments with etms,

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<v Speaker 4>but you're also that's also against you, that you will

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<v Speaker 4>between you say, not interested?

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<v Speaker 1>Good, good question, Daniel.

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<v Speaker 3>The simple answer that is, it's not possible to have

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<v Speaker 3>shares or an investment account that's attached to the home

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<v Speaker 3>loan because the bank wants to use that cash. So

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<v Speaker 3>they want you to come in get your home loan

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<v Speaker 3>with them, and then have a cash account that's linked

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<v Speaker 3>to the home loan as an offset account. And so

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<v Speaker 3>what the bank can then do is take that cash

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<v Speaker 3>and go and lend it out again. So they don't

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<v Speaker 3>want you investing in shares to offset debts. So unfortunate.

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<v Speaker 3>That would be a great a great vehicle for the

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<v Speaker 3>banks to have if they if they could, but they're

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<v Speaker 3>wanting to use that money to make more money, to

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<v Speaker 3>make them more profits, I suppose. So now, unfortunately, not

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<v Speaker 3>Daniel can't have an investment count.

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<v Speaker 2>What a pity that same logic doesn't apply to government

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<v Speaker 2>super and text, so that we've actually got to have

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<v Speaker 2>the cash before they can taxt it.

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<v Speaker 3>Well, exactly, you can't just print money, Diane, good afternoon, Good.

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<v Speaker 5>After the name Blake. My question, I'm sixty four, hobby

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<v Speaker 5>is eighty two, so we may have the season last

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<v Speaker 5>year for me to retire. And I have two allocated pensions.

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<v Speaker 5>One is a thousand a month and the other one

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<v Speaker 5>is five hundred or fortnight. Now, we did a twenty

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<v Speaker 5>thousand redraw, Chris, the can't blew up in this current

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<v Speaker 5>financial year, but we're thinking we're going to need to

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<v Speaker 5>do another redraw? Are there tax implications because I'm only

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<v Speaker 5>sixty four? Are their tax implications on our recourse?

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<v Speaker 3>When you say redraw, Diane, are you referring to pulling

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<v Speaker 3>funds out of that allocated pension and withdrawing No, they.

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<v Speaker 5>Came out as the accumulation super.

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<v Speaker 3>Okay, yes, so if you withdraw money out of SUPER

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<v Speaker 3>over the age of sixty, there's no tax implications. However,

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<v Speaker 3>if you've got an accumulation account where the money isn't

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<v Speaker 3>providing you with a pension, it's just simply there invested.

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<v Speaker 3>There are potential tax consequences for selling investments in accumulation phase,

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<v Speaker 3>and so there could be capital gains tax to consider

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<v Speaker 3>if you are liquidating investments from the accumulation account. If

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<v Speaker 3>you were to take it out of an allocated pension

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<v Speaker 3>or an account based pension, there's no tax in that environment.

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<v Speaker 3>So consider potentially taking it out from the account based

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<v Speaker 3>pension as a priority to the accumulation account first and foremost, though, Diane,

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<v Speaker 3>I'd encourage you just to get some advice around making

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<v Speaker 3>the withdrawal, just to understand whether or not there are

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<v Speaker 3>tax consequences on the accumulation side if you are wanting

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<v Speaker 3>to withdrawal from that account. But certainly over the age

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<v Speaker 3>of sixty, if you pull money out of supun there's

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<v Speaker 3>no tax on that withdrawal. It's just behind the scenes,

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<v Speaker 3>maybe there's some tax involved.

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<v Speaker 2>All right, good question, Diane, Thank you for that. One

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<v Speaker 2>three one eight seven three. We'll get to some more

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<v Speaker 2>questions in just a moment. I was speaking earlier, as

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<v Speaker 2>you would have heard to a dancing experts, thinking to

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<v Speaker 2>Georgia Freeman, that is, she's going to be part of

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<v Speaker 2>Burn the Floor, and you'll be there on it because

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<v Speaker 2>you'll be dancing. Man, you're a student of history. Perhaps

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<v Speaker 2>you can help me out here. This just came through

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<v Speaker 2>from Darryl, he said, Michael. In the eighteenth century, not

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<v Speaker 2>everyone was happy with dancing. In fact, the Methodist Church

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<v Speaker 2>banned six in case it led to dancing. Oh jeez,

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<v Speaker 2>I suspect it's meant to be the other way around.

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<v Speaker 2>They banned dancing in case it led to six.

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<v Speaker 3>Maybe they didn't like dancing as.

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<v Speaker 1>Because I'm just thinking. I mean, I don't know, but

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<v Speaker 1>I'm just thinking.

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<v Speaker 2>Most religious institutions like to have repeat customers, you know,

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<v Speaker 2>and the next generation come through to maintain the buildings.

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<v Speaker 2>And what if you ban sex unless you've found Methodists

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<v Speaker 2>among the Catholics, for example, you'd run out of parishioners

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<v Speaker 2>pretty quick, wouldn't you.

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<v Speaker 1>But it's a number of questions for you.

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<v Speaker 3>Right, Well, I don't know how this is a numbers question,

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<v Speaker 3>but okay, well, well we've.

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<v Speaker 2>Got one plus one equals two. They get together and

0:11:18.679 --> 0:11:21.480
<v Speaker 2>make three. But if they can't add the course, you.

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<v Speaker 1>Track the population growth and more dancers adds a sign

0:11:25.880 --> 0:11:28.679
<v Speaker 1>curve to the Yes, that's that's right. Yeah, they carry

0:11:28.720 --> 0:11:31.040
<v Speaker 1>the four. Yeah, all right. John on the text says

0:11:31.040 --> 0:11:32.920
<v Speaker 1>perhaps there was Methodist in the madness.

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<v Speaker 2>Nice one, John, one of your best. Jerry says, no,

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<v Speaker 2>I won't read that one.

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<v Speaker 3>Thank you.

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<v Speaker 1>Jerry.

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<v Speaker 2>By the way, Blake Waders hear from Pretzel. We're talking finance,

0:11:40.080 --> 0:11:43.000
<v Speaker 2>among other things. You can book that complimentary consultation with

0:11:43.040 --> 0:11:43.440
<v Speaker 2>Blake today.

0:11:43.440 --> 0:11:44.040
<v Speaker 1>You should do it.

0:11:44.200 --> 0:11:47.720
<v Speaker 2>Visit pretzelwealth dot com dot au. Back to calls Peter

0:11:47.800 --> 0:11:48.960
<v Speaker 2>good afternoon.

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<v Speaker 6>Yeah, good a, Michael good A, Blake. Just a quick

0:11:54.440 --> 0:11:56.920
<v Speaker 6>question for you, Blake, just following up on what you

0:11:56.920 --> 0:12:00.920
<v Speaker 6>were saying about the mirrored accounts. Yes, you would then

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<v Speaker 6>obviously you would pay personal income tax on the on

0:12:04.600 --> 0:12:08.120
<v Speaker 6>the income derived from those. But wouldn't you, on the

0:12:08.160 --> 0:12:11.520
<v Speaker 6>other hand, have franking credits as an offset.

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<v Speaker 3>Exactly right, Yeah, franking credits would come in to that equation.

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<v Speaker 3>If we're investing in Australian shares that provide a franking

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<v Speaker 3>credit to help offset some of that, so you could

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<v Speaker 3>expect to get a decent amount of income from that

0:12:24.440 --> 0:12:27.760
<v Speaker 3>that is quite tax efficient. It's just sort of a

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<v Speaker 3>general point of call because if we compare investing personally

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<v Speaker 3>with investing through super, especially in retirement phase, it is

0:12:36.200 --> 0:12:40.599
<v Speaker 3>quite tax effective investing through superinnuation. So we want to

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<v Speaker 3>try to focus there first.

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<v Speaker 1>But there are.

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<v Speaker 3>Cases where we can't get can't get the money's into

0:12:47.120 --> 0:12:49.920
<v Speaker 3>super and so you know, as a good example, over

0:12:49.960 --> 0:12:53.360
<v Speaker 3>seventy five years of age, or you've used up or

0:12:53.400 --> 0:12:57.440
<v Speaker 3>your contribution capacity, and so you know, a mirror account

0:12:57.559 --> 0:13:00.520
<v Speaker 3>could be a good solution to still get some good

0:13:00.520 --> 0:13:03.120
<v Speaker 3>returns on the investment, subject to what the markets are

0:13:03.120 --> 0:13:05.000
<v Speaker 3>doing and subjects are taking on a little bit of risk.

0:13:05.679 --> 0:13:10.600
<v Speaker 3>But you know, these accounts or account types are quite

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<v Speaker 3>effective at making sure that you know you're trying to

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<v Speaker 3>build wealth. I suppose I have the long term and

0:13:16.760 --> 0:13:20.120
<v Speaker 3>it also comes into playoffs. Suppose down the track, if

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<v Speaker 3>you're thinking about passing on wealth to kids, if you've

0:13:24.400 --> 0:13:26.360
<v Speaker 3>got money sitting in the bank and it's going you

0:13:26.440 --> 0:13:31.120
<v Speaker 3>know it's getting eroded by the effects of inflation, investing

0:13:31.160 --> 0:13:33.160
<v Speaker 3>the funds can be a good solution to try to

0:13:33.200 --> 0:13:36.520
<v Speaker 3>preserve the wealth that gets passed onto the kids. But

0:13:36.760 --> 0:13:38.840
<v Speaker 3>great observation the Peter. There there could be some franking

0:13:38.880 --> 0:13:42.280
<v Speaker 3>credits for investing in austrange shares.

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<v Speaker 2>Okay, good question, Well done, Peter, Thank you for that.

0:13:45.320 --> 0:13:48.680
<v Speaker 2>Now back to this situation with the super text. I

0:13:48.679 --> 0:13:50.439
<v Speaker 2>was saying to you earlier, I think the government of

0:13:50.480 --> 0:13:53.720
<v Speaker 2>trying to weage the coalition here, and I've got a

0:13:53.760 --> 0:13:55.160
<v Speaker 2>bit of a fear that the coalition are going to

0:13:55.160 --> 0:13:57.960
<v Speaker 2>tumble for it. I'll say some more about this after too.

0:13:58.040 --> 0:14:01.080
<v Speaker 2>But the Prime ministers, according to many reports today, open

0:14:01.200 --> 0:14:05.960
<v Speaker 2>the door to rewriting the proposed superannuation tax hikes. Now

0:14:06.040 --> 0:14:10.319
<v Speaker 2>I can only imagine that would involve a slightly different

0:14:10.559 --> 0:14:12.080
<v Speaker 2>threshold or something like that.

0:14:13.080 --> 0:14:18.120
<v Speaker 3>Perhaps perhaps indexation, perhaps, yeah, hopefully a higher threshold. You know,

0:14:18.679 --> 0:14:19.240
<v Speaker 3>we yet to see.

0:14:19.280 --> 0:14:21.120
<v Speaker 2>I suppose the guess the question for you, Blake, is

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<v Speaker 2>in your opinion, is there a way to actually make

0:14:23.040 --> 0:14:29.800
<v Speaker 2>this a worthwhile reform? Is there anything reform aligned with

0:14:29.960 --> 0:14:31.240
<v Speaker 2>this at all?

0:14:31.760 --> 0:14:35.120
<v Speaker 3>I suppose increasing the threshold would be a start getting

0:14:35.200 --> 0:14:37.480
<v Speaker 3>rid of it is also probably a good idea. It

0:14:37.520 --> 0:14:40.880
<v Speaker 3>goes against really the nature of our taxation system here.

0:14:40.920 --> 0:14:44.600
<v Speaker 3>You know, we don't tax unrealized gains, and so that

0:14:44.720 --> 0:14:46.760
<v Speaker 3>that's really what's behind it all. This is why so

0:14:46.800 --> 0:14:50.080
<v Speaker 3>many people are upset. People who don't have three million

0:14:50.120 --> 0:14:53.200
<v Speaker 3>dollars in super are upset as well, mind je, because

0:14:53.200 --> 0:14:56.280
<v Speaker 3>it goes against the nature or what the intent has

0:14:56.320 --> 0:14:59.080
<v Speaker 3>always been. Now, if they're opening the doors up to

0:14:59.360 --> 0:15:02.640
<v Speaker 3>tax unrealife gains, and I get it, they're taxing people

0:15:02.680 --> 0:15:04.920
<v Speaker 3>with large super innovation balance and not all of us

0:15:05.240 --> 0:15:08.920
<v Speaker 3>are impacted by this. But you know, if they're going

0:15:08.960 --> 0:15:11.800
<v Speaker 3>through that process, well then what's to say that they

0:15:11.840 --> 0:15:15.440
<v Speaker 3>don't open the doors up further elsewhere unlikely not being

0:15:15.440 --> 0:15:18.600
<v Speaker 3>talked about at the moment and not being considered, I'm sure,

0:15:18.640 --> 0:15:22.200
<v Speaker 3>but you know it does open the doors potentially to say, well,

0:15:22.240 --> 0:15:24.680
<v Speaker 3>we've done it on super Maybe we look at family trusts,

0:15:24.720 --> 0:15:26.200
<v Speaker 3>maybe we look at businesses.

0:15:26.320 --> 0:15:29.320
<v Speaker 2>Whatever that's the concern. All right, we'll speak again next week.

0:15:29.360 --> 0:15:29.840
<v Speaker 2>Thank you, Blake.

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<v Speaker 1>Seeing that Blake went there from Pretzel, Will